I want to speak with you today about the selection of title insurance underwriters. For years the tradition has been for one or both of the Realtors involved in a sale to agree on a specific title company, office and escrow officer. The clients usually don't voice an opinion.
So while the title company wants to lay claim to the seller on whose behalf they are insuring to the buyer that the seller has indisputable ownership of the property he is selling, their real clients are the Realtors. And that's where their loyalty belongs.
In Texas, and probably throughout all or most all of America, the title insurance rates are regulated by the state. If you buy a $200,000 home in Texas, the title premium is the same at all Texas licensed title companies.
But what isn't regulated is what the title company passes off as additional charges for their services, frequently labeled as escrow fees, messenger service, document preparation, copies, wire transfers and on and on. And they are rarely the same among companies.
In fact, they are negotiable, yet I'll venture to say that most Realtors don't dial this into the equation when they are selecting the company where their sale/purchase will take place. (For the record, I always do.)
But how can it not be the Realtor's obligation to make certain that the client is not going to pay unnecessary fees so that your favorite closer can have their business? It can't be. It is the Realtor's obligation.
I keep a watchful eye on what title companies want to charge my clients, and I frequently call around to see what a sample of the companies are charging for the components of their services. If the charges to my clients are out of line, the title company either has to reconcile the matter or I threaten to move the file. I've only had to do this once, but I'll promise you I'll do it in a heart beat if the company that's opened escrow for my client is padding the bill.
DALLAS
214 503-8563
Our 43rd Year Selling Texas
Copyright 2008 - William S. Cherry
Bill, Thank you for your insight to dealing with the title companies. We are ready to close on an investment property and we are only requiring an Abstract Certificate and that has been provided but the sellers "attorney-title company owner" says we are required to buy title insurance, of course from him. We are paying cash and we should be able to do what we want to do. We are going to resell the property and at that time we will provide title insurance. Sometimes it is hard to deal with some title companies.
Good information, just as department stores charge different prices for the same product, it seems so do title companies/closing attorneys, in todays world we don't just walk into the store and buy something without questioning the price especially if we know next door the price is lower.
Have A Wonderful Day
Good post. You have to be careful. Some will try and slip those "extras" in and wont bat an eyelash about it.
Great advice Bill...I will definately keep my eyes open rom now on!
So many realtors don't know enough about their business..... and they need to read this article.
You, Bill, show professionalism by taking care of your clients where other realtors stop.
Thanks to each of you for adding your thoughts.
Real estate people learn the word fiduciary when they are studying for their licenses, and they frequently throw it around like it's some sort of pedigree when they say, "It's my fiduciary responsibility...."
Well, here's one time when a Realtor can say it's his fiduciary responsibility. It's his fiduciary responsibility to make certain when he picks a title company for his clients, they are going to get good service and that they are not going to be ripped off with added fees, excessive charges for the attorney's service, escrow, messenger fees and the like.
I'm sorry I'm ranting and raving, but this is something I feel very strongly about.
Great post, Bill. I have questioned high fees myself, and in a couple of cases, shopped around. In Lancaster County the buyer has the choice of title companies. If we're representing the buyer, shouldn't we be assuring ourselves that the title company's fees are fair?