The Uniform Settlement Statement : HUD-1 Serious Question

Hey David...if that's really you playing the piano....YOU'RE DAMN GOOD!!!!!!!!!!!

On your question...We also know that sellers are not allowed to require a buyer to purchase title insurance from a particular company as a contingency of the sale.

What problems have you encountered with the HUD-1 ? Have you ever had a situation where a lender or seller required you to use any particular company as a contingency of the sale ?

My answer to those questions are I would clearly take the position that anyone requiring you to use a certain servicing company for anything in a real estate transaction would be a clear violation of RESPA.  Secondly trying to require a particular company as a contingency would be like signing a contract to murder someone...it's still just as illegal....in other words...you can't legislate by contract.

David,

The only problem that I have encountered recently is: which title company should close the transaction  (we do not use attorneys in New Mexico).  Many buyer brokers have sometimes insisted that the buyer choose the title company; probably because they have just heard or read that the buyer cannot be required to use a particular title company to close the transaction).  The problem is that, in our market, the seller usually pays for the title insurance.  An overly aggressive buyer broker sometimes insists the transaction be closed by a different title company than the seller (or the seller's broker) has chosen to do the preliminary title work.  So the response to such a request/demand from the buyer broker is:  "fine ... since your buyer will now be paying for the title insurance, it is only fair that the buyer select the title company."  Since the purchase agreement typically states that the seller will pay for the title insurance policy, the buyer and the buyer broker will quickly relinquish their demand to use "their" title company.

Wow Bill...that's strange.  In Arkansas the Buyer has to pay for the title insurance required by "their" mortgage company making the loan and the seller pays their portion to insure to the buyer proof they have clear title.  I can't imagine not having each pay an almost 1/2 share.  Glad I don't have to deal with that.  I choose one title company and swing all the business I can and in return they accomodate me more.

Generally, I have found that many real estate agents and mortgage companies don't dictate which title company to use. And, under RESPA, the seller may not require a buyer to to purchase title insurance from any particular title company as a condition of the sale. To do so is a clear violation of RESPA. However, your lender can require title insurance from a company that is acceptable to it. In most cases you can shop for and choose a company that meets the lender's standards.

David, I would say to Kathy Bohon....ask this listing agent "Can You Spell   R E S P A ?"

As for PreQual and PreApproval...Preapproval isn't as all encompassing as one might think...all preapprovals are "Subject To...." a whole host of things which can make financing fall though at the underwriting level.  That's more often than not, a less experienced loan officer that doesn't anticipate.

As for Chosing a Lender....I don't think the law would make distinctions as to what potential lender is "valid" or not.  Money is money.  "Uncle Sal's cash in the truck" shouldn't matter.