One of the ways in which title companies find notary signing agents to do closings is through signing services. Rather than the title company concerning themselves with maintaining a list of notary signing agents and making a lot of phone calls when they need a closer, they leave that responsibility to the signing service. The title company also does not get involved with paying the signing agent. In fact, there is very little communication between the notary signing agent and the title company under this type of arrangement. Everything is done through the middleman -- the signing service.
How convenient is this relationship?
For the most part, it works out pretty good. The title company is able to obtain the services of notary signing agents. The notary signing agent is able to get closing assignments that they might not have otherwise been able to get. The signing service provides a service to the title company and to the notary signing agent.
But there are drawbacks.
In order for this type of arrangement to work, there has to be very good communication. Instructions from the title company must be given to the signing service, which in turn passes them on to the notary signing agent. This doesn't always happen. As you can imagine, whenever a message is passed on to someone indirectly, there are bound to be breakdowns in communication.
Another disadvantage is the time it takes to relay a message. It would be much quicker, and easier, if the title company spoke directly with the signing agent when they had important information to convey. But when that information has to be routed through the signing service, there can be delays. Notary signing agents are all too familiar with being in a position where they needed instructions. They called the signing service, and the signing service said they would call the title company, or send them an email. Wouldn't it be quicker for the notary signing agent to call the title company directly?
It would be, except that many signing services prefer to limit the amount of contact the signing agent has with the title company. And they don't want notary signing agents trying to get their foot in the door of the title companies. For example, they forbid the signing agents to send business cards to the title companies. There is at least one signing service that claims that they make regular rounds to the title company to make sure that they don't see any business cards from notary signing agents on any of the desks.
This is one of the reasons why many notary signing agents do not want to work with signing services. They know that, in order to do their job more effectively, they must be in direct communication with the title company. Not only that, but by cutting out the middleman (the signing service) they have more control over how much money they can make on a closing assignment.
Title companies could be saving a lot of money.
Just as the notary signing agent can make more money, the title company can actually save money by working directly with signing agents. If the title company were to pay the signing service a fee of $300, the signing service would only want to pay the notary signing agent half of that. Even less. But what the title companies don't realize is that, they could actually save a lot of money by working directly with the notary signing agent. Chances are, the signing agent would be willing to do the closing for $200. It's $100 dollars less than what the title company would have paid, if they went through a signing service. And it's $100 more than the notary signing agent would have made, if they took the assignment from the signing service.
Full disclosure to the borrowers
Early in my career I did a closing for which the borrowers were charged $500 for notary fees. The borrower looked at me and asked: 'Is this how much I'm paying you?' I wish. I was making a fraction of that amount. The majority of it was going to the signing service. Yes, the borrower was actually paying $500 in notary fees. But not to me. Most of the time, when I work directly with the title company, my name will be on the HUD Settlement Statement. And it will show the amount that I am being paid for that closing. That is the way it should be. The borrower knows exactly where the notary fee is going, and how much.
All of this is not to say that all signing services should be eliminated. There are very many that do an excellent job. They get involved in the closing. They can be reached if the signing agent has a problem during the closing. It's a joy to work with these signing services. But there are many that do nothing more than make an initial phone call to the notary signing agent. Beyond that, it's the notary signing agent that ends up doing most of the work.
This is the question that title companies must ask themselves. What are they getting from the signing service? Are they paying a signing service hundreds of dollars just to make a phone call? Wouldn't it be cheaper to make the call yourself?
And wouldn't the information flow quicker and more efficiently if you worked directly with the notary signing agent?
Comments (6)Subscribe to CommentsComment