Simply put, I think we stopped recognizing the value of a good title company. I know I am guilty of taking good title service for granted, especially as a buyer's agent. In this foreclosure market frenzy, some title companies (at least in my area) have become almost single sourced for business. Some companies are kept absolutely busy by a single attorney firm or REO mitigation company. That is great, except the service they offer the buyers has become increasingly poor. Now, on some REO transactions I have completed, there have no title charges to the buyer, so you could make the argument you get what you pay for; other transactions though have netted the title company 250-300 dollars in closing charges from the buyer's side alone.
Now I firmly believe good service should be rewarded with good compensation; however, in one particular transaction I recently closed, the title company charged the seller 200 and the buyer 250 for a total of 450 in closing fees. The trouble started when we got the first HUD (36 hours prior to the scheduled closing)...lots and lots of errors. Then the second HUD had less but still some of the same errors that had been noted on the first HUD. After several more phone calls, we seemed to get everything in order - or at least I was told it would be, since the person who did the HUDs was gone for the day, but was assured it would be corrected. Now all we needed was the rest of the docs - since we hadn't seen any of them yet. I couldn't even get an answer to the type of deed being conveyed (and the closing was for later the next day.) After not having the docs ready the next day, I called to reiterate my earlier concern that if we didn't have adequate time to review the docs we would not close (my buyer was adamant about this from the very first written offer). This is when the real fun began.
To save your time and energy I will simply skip to the part where I brought RESPA into the discussion. After a lengthy discussion on how that impacts our ability to close the buyers right to review documents prior to closing, I was basically told if we didn't like the way things were, maybe we should buy something else. The title company, who we were paying to close for us told us that! Apparently they seemed to have forgotten that we were also customers in this transaction. Well, we did close, and it was ugly and drawn out, and it closed in escrow after a last minute express mail fee popped up on the new HUD (so they could send something from the closing city to their 'processing' center). In the end, I ate it because it was wrong, but my clients had already taken time off and re-arranged their schedule to meet tht title companies time constraints (no seller, no seller agent, no seller attorney - the buyers and I were the only ones there and yet the title company had insisted on a completely inconvenient time allowing us to think this was because of the sellers ability to attend).
Never again! I have a couple GOOD title companies I work with and I make sure now that I advise all my buyer clients to retain the services of a seperate company to represent them in the transaction.
It is high time we make sure that we reward good title companies and demand satisfaction from those that don't provide it. We owe our clients nothing less.
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