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One More Mistake and I'll.......

I have been working with the same title company for a few years. The guy that owns the company is a good friend. There have been little mix ups from time to time....no, that's not right....on most files. I have tried to just let it go. I caught them before it was too late. No harm done.

Today's little mix up was that the buyer was paying the commission on top of the purchase price, according to the HUD. The HUD had been sent to my attorney, the lender and the lenders attorney, plus me.

I have been prospecting the attorney that had me engaged for over 3 years. He pushed me on his client, a large commercial lender with a ton of potential business. The transaction went wonderfully. I looked great. Now, one of my vendors makes a silly mistake that makes me look bad. I am hearing from others "how can your guy make such a dumb mistake, Rich?" I'm thinking "good question"

I had no choice. I had to pull the deal from him. I had to look out for my business and I had to take corrective action to keep the client. As sorry as I was; as bad as I feel; it had to be done.

Within 30 mintues the attorney-manager of a multi-branch title company was sitting in my conference room. I called his office, was transferred to his cell and he drove over to my office instead of going to his. I guess he wanted the business. I met him at a conference he sponsored on distressed property where I told him I was happy with my current vendor, by the way.

This experience brings three things to mind:

Your best clients will leave you at the drop of a hat if you screw up
There is always someone there to accept their business
You never know where you are going to meet your next client, vendor or partner so keep alert.

You know, I'm not mad at anyone for the mistake. I am disappointed. There are a lot of other things I would have liked to do today, but I needed to be a business owner.

Richard F. Kruse is the President of Columbus, Ohio based Gryphon USA, Ltd. (www.gryphonusa.com). The Gryphon Organization includes Gryphon Asset Management providing receivership and consulting services in the distressed marketplace, United Country Ohio Realty & Auction Group (www.ucohiorealty.com & www.ucohioauctions.com) providing real estate brokerage and auction services throughout Ohio and OnlineAuctionUSA.com (www.onlineauctionusa.com) providing commercial asset liquidations from the Midwest to East Coast.

United Country Ohio Realty & Auction Career Opportunities Available. Call 614-885-0020 x 17

Posted by Rich Kruse on 12/06/2006 03:26 PM

Comments (25)

title, vendors, mistakes

Originally posted at: Asset Management & Recovery: One More Mistake and I'll.......

25 Comments on One More Mistake and I'll.......

DEC

2006

It's too bad but we had to do it. You know that I'm all about loyalty but not to the extend that we look bad. =(

Rich, You got to do what you got to do. I too am very loyal and will overlook an occasional mistake. For one, I know if I switch, they'll probably make mistakes to. Better the devil you know. But if it is a continuous problem you have to switch. Hey it's business. If your friend doesn't understand that then they weren't really your friend to begin with.

Things happen, Rich..... business is business...it is NOT personal unless your buddy makes it personal...THEN you have to decide weather to keep the friendship.....

Relationships are this business. Control the transaction by using known entities.

Unfortunatly in this case the known entity was the problem. We would not normally switch vendors, particularly in the middle of a deal, but to continue with someone who was making such glaring mistakes, makes our company look bad. Better to acknowledge the problem and be proactive to fix it than to continue on the same course.

Olive - maybe representative of the martini that I needed after today??

David - I had a long response to this that addressed your and BB's position. It deleted (spelling?). I agree with both of you.

I didn't do what I wanted to do. I did what I needed to do. I feel like crap. I feel like I screwed a friend. I feel like I did what was best for my business and my family.

If Mr. Title called right now and asked for the shirt off my back, he would get it. If he asked for the closing he would not.

Maybe this is another blog: What is harder? Loyalty or Betrayal.

Another question. Is this betrayal?

gotta think about it in another way, though-perhaps your bold move will cause your friend to take a long hard look at his business and his systems (because you didn't pull the business away from HIM you pulled it away from faulty SYSTEMS)-and he will revamp and improve. hopefully he's logical enough and rational enough to learn from this and become better, wiser, and stronger. it took a lot of gumption to do what you did-which is often the case with the right path.

It is not betrayal. You would not expect someone to continue working with us if we were consistantly making minor and sometimes major errors. There were multiple errors with my parents' closing. I told them repeatedly that it wasn't a big deal, the title company was good, etc. In the end my parents got their closing done and it didn't matter but this was different. We only have one chance to make a first impression. How others represent us is part of that first impression. We have put a lot of time, money and effort into making that impression positive and professional. We cannot afford to have it compromised by someone who is making glaring errors. I am a huge proponent of loyalty but not to the extent of MY reputation. True friends would not want to compromise that.

I have to agree with Leigh. If this causes Title company to look at what is going on internally and make changes, I'd love to go back to them. This may be the wakeup call that they need.

Business is business. Maybe you let a minor error go, possibly a second minor error. But thats about it....anything more and its more than a pattern, its a behavior!

Nobody is perfect all of the time. Sometimes, because of relationships, you let a mistake, here and there, slide by but there are times when someones mistake may cost you, big time, and that someone has to take the blame and the consequences. Thats why there is the expression, The buck stops here.

Loyalty is important. But, it runs both ways. A vendor needs to be loyal to you to, and that means get it done right. You mentioned it was a friends company. It is hard not to choose to do business with a friend, but one must always be clear up front about what is expected, otherwise you might lose a friend

Rich, I agree with your wife and Bryant... and Leigh even brings up a good point. I have seen this type of move make someone wake up. Then again, some people just don't care or pay attention... sad, but what can you do. You need to keep your clients happy.

Yes, I am very loyal and expect the same. And if I were to make mistakes, I would want to be told about it.... look at it, review it...try to figure out why. All I ever ask anyone that I work with.... let me know, it's not personal. It is business...

DEC

2006

Rich,

It's a sad story, but we've all been there.

Like Jeff I normally use the same people as much as possible, due to the nature and volume of business we've used a lot of people over the years.

I've been using the same two escrow ladies for over 18 ears, although they have gone through 4 or 5 title companies during that time, at least one change was because I had them recruited after some major troubles with a tirle plant. They get about 1/3 of my business.

My primary appraiser I've been using nearly 15 years. She gets about 60% of my business.

I get great service, but they know one lie and I'm gone. I had problems with one title company and two hours later the head of the largest title company in our market hired my favorite escrow office in part to get my business.

I'm very tolerant of small correctable mistakes, but not repeated or deliberate problems. One of the nice thing about a well know team is we always try to make each other look good. But, don't fool with my clients!

Bill

William J Archambault Jr

The Real Estate Investment Institute

http://www.reii.org

it's such a cautionary tale as a small business owner to hear this. and it's so true that there is always someone waiting behind you to push you down and ready to take your place. i think in our industry has such a fluctuation, sometimes retention is very difficult. and sometimes relationships are not enough. but thanks for reminding me this important lesson.

cheers,

cindy

i stage & redeisgn to sell, live and work in san francisco bay area cindy@staged4more.com
www.staged4more.com
http://stagingtipsandmore.blog.com/

It's so true. We count on our partners to make us look good, and when they screw up, we look bad. Our title company at least sends us the HUD before they send it out to the client or lender. My favorite mistake is them sending me a HUD with no commissions on it. I've never had one where they overlooked the title insurance!

"Rich aka Delicate and Melissa aka The Other Lovely Wife"

You must protect your good name.

Your name and reputation in this business are everything. Once it's ruined it can not be undone.

In my opinion you guys did the right thing, even if he was your friend.

If he is a real friend then he will understand that your livelihood must comes first.

TLW "The Lovely Wife"...These Are Hard Decisions To Make...ROAR!

William.... that last sentence of yours, you hit the nail right on the head. That's how I operate....

No brainer. ALL parties have to work in unison and 'error free' for the transactions and future referrals to flow. The goal is to meet the buyer and seller's needs, not to give business to a friend. Now if the friend can meet the goal, that's different. The goal is the key.

My Title company is in 'constant' communication prior to any closing to make sure the Realtor and Lender sides are always in sync with status.

Surprises at the table are of course a disaster (but solvable with a smile), but repeated mistakes that you are 'catching' does not bode well for the talents of your friends company.

I would have dropped them as I expect any of my clients would do to us. We take the philosophy that we HAVE to be better to earn business, thus are always in a continual improvement mode looking at Preventive Action versus Corrective Action.

You said it yourself. this was a BUSINESS decision that you had to make. Not personalities or feelings... The only problem I have found when having to make those choices the friend sometimes has difficulty seperating business from the personal. But if you as the owner don't look out for your business interests who will?

Rich,

I think too that your friend might have just gotten too comfortable with you. You yourself said that it was not the first time that he messes up. But he might have just felt to himself not to worry, Rich will understand - naturally, not at the cost of losing a deal. He might have taken your relationship for granted a bit. Does he treat his other customers this way? Would he have double check their documents? Making sure all that needed to be done was done correctly? I say, give him yet another try on smaller deals to let him see that there are no hard feelings. Explain to him that if he should mess this one up, then your business relationship with him will end. Keep this in writing and just say to him as was said before, it's business - nothing personal!

Rich - Good call. Been there - done that. Two strikes you're out. Not fun - just business. Thanks!

Rich,

In reading your BIO I noticed you deal in pre-foreclosure properties and we have done very well in this area using the Short Sale process along with the Auction method in helping agents and sellers in selling a property that otherwise may look un-saleable.

Another difference is we use an Attorney for closings, our Attorney provides the same service a Title Company does, only we receive referrals from him when his clients are faced with a pre-foreclosure or financial crisis situation concerning their property.

I feel that utilizing his services has more than paid for itself in referrals alone, only mentioning this as another avenue to look at.

Nothing more embarrassing than singing the praises of a hand picked vendor who then proceeds to let you down.

Alas, there went Jason, a really nice guy, but our clients were dropping through the cracks. Fortunately, there were mortgage agents stacked up for our business.

I really liked Jason, hell I still like him. I hope it works out for him. He left as the in-house lender. Seems there were more clients than just ours dropping through the cracks.

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