title industry: A follow up to Lenn's post - 02/08/08 03:58 AM
A special thank you to Lenn Harley for writing a stellar post about the offshoring of title searches. Check out Lenn's diagram. I love it! Thanks are also due to all of you who commented and showed concern. Offshored title searches are a particularly complicated matter that have become something of a personal cause for me and a rapidly growing number of others. I've prepared a slide presentation highlighting the spirit of Lenn's post for Title-opoly and decided to give friends on Active Rain a sneak preview. Following Jeff's advise, I'm experimenting with eyejot and hope to embed a meaningful message … (13 comments)

title industry: Who's Watching the Watchers? - 01/16/08 04:20 AM
Last week, I suggested that real estate agents check up on title companies after closing to make sure that mortgages were paid off.  Why?  Title company executives have been known to "help themselves" to money held in escrow, particularly when business is bad. See: Is Your Title Company Misbehaving? Most people don't realize that the title industry is basically unregulated in most states.   Unregulated as well, are the massive escrow accounts administered by the title companies.  A preliminary federal study released in 2006 revealed a laundry list of startling truths about a misunderstood industry and its primary product, title insurance.  Most … (12 comments)

title industry: Is Your Title Company Misbehaving? - 01/09/08 11:02 AM
Have you ever wondered about the integrity, or competency, of a title company after leaving the table?  To say that an enormous amount of money is blindly entrusted for proper dispersement is a serious understatement.  On a monthly basis, we could be talking about tens of millions of dollars gushing through the escrow accounts of average sized title companies.  Who's keeping track of all the money?  You'd be surprised to know the answer.A question recently asked on Mortgage101.com, click here to read, describes the consequences of a title company screwup.  A week after closing, a buyer was informed that his loan … (54 comments)

title industry: CE Courses Sponsored by Title Companies: We Need to Talk - 12/10/07 01:43 PM
I've noticed quite a bit of dialog concerning continuing education courses being sponsored by title companies.  I'm talking about CE credits for real estate agents.  Sound familiar?  At first I thought it sounded like a great marketing idea for title companies, but then I got to thinking: are these courses provided for free?
I've asked a couple of friends if they thought it was a RESPA violation and they see a real problem with the practice.  A RESPA exception for educational purposes would make sense, but I don't know of one.
RESPA offers a very limited window of opportunity for service providers to market … (85 comments)

title industry: Currents of Change: Title Industry Blogs - 12/02/07 03:14 AM
The mere mention of the title industry in the caption of this post dooms it to inevitable ambiguity obscurity.  The topic, perceived as draconian, clearly lacks sex-appeal.  As a title company owner, I was often dismayed by the audacious remarks of real estate agents who thought they knew my job better than I did. Trust me, they didn't.  Only those who have worked in the notoriously "behind the scenes" industry could begin to comprehend the risk and transactional complexities faced daily by title professionals in 2007. It was one year ago today that I first commented on Diane Cipa's edgy and … (50 comments)

title industry: Digital Sweatshops - 08/08/07 11:49 AM
I realize that I've been pontificating quite a bit  recently about the dangers of "offshoring" title work to India.  For those of you who are tired of my rant, I apolagize in advance.  It's just that I'm an "old school" title abstractor and title examiner.  I know that title searches conducted overseas are a waste of bandwidth and eventually we'll be inundated with senseless litigation that could have, should have, been avoided. 
Earlier today, I mailed the following letter to United States Senator Barbara Mikulski.  Tomorrow the same letter is being sent to all other federally elected officials from the state … (11 comments)

title industry: Food for Thought on a Sunday Afternoon - 08/06/07 04:05 PM
I've written a couple of posts recently about the nasty business of "offshoring" skilled domestic jobs to points around the globe.  The comment threads on each clearly portrayed a sense of interest and concern.  One reader surmised, at first, that I might be a "liberal nut job."  He changed his mind, but I have to add that I've never been called liberal before. What do you think?  Another reader asked "should patriotism be the only reason to hire local labor?"  Face it, each person's perspective is unique and based on experiences.  We're entitled to our own opinions.  From an economic perspective, … (48 comments)

title industry: Dissent Is Our Duty! - 08/04/07 04:06 AM
This morning, I saw a bumper sticker that read "Dissent is the highest form of patriotism."  It struck a chord with me and was an appropriate message at the end of a troublesome week.   I attended high school during the 70's when healthy dissent was considered a personal and civic obligation.  Those of you who are roughly my age, I'm 46 years old, will understand this post.  The Franciscan Friars at Archbishop Curley, where I attended high school, instilled in their students a healthy dose of skepticism and a certain distrust of authority.  We were taught to think for ourselves … (65 comments)

title industry: The Title Industry: A Sad, Horrible Rumor Confirmed! - 07/29/07 10:03 AM
I first heard of a direct connection between the American title industry and the vast labor supply in India a couple of years ago. A vice president for Stewart Title mentioned, in passing, that title insurers were using cheap Indian labor to answer customer service questions.  Consumers calling (1-800 #)'s from this country have no way of knowing that the phone is being answered in Bangalore, Delhi, Nagpur, or Pune.  These are just a few of the Indian cities, experiencing unparralleled economic growth, contributing to the country's emergence as an economic powerhouse.This post is not about India or it's economy.  It's … (51 comments)

title industry: The American Title Insurance Industry - 07/16/07 10:39 AM
A book, soon to be released, examines the misdirected focus of the title industry in matters of public policy.  Based on four years of research by Professors Joseph and David Eaton, "The American Title Insurance Industry" attempts to expose the motives of an industry that intentionally conceals itself and it's products from public scrutiny.  The new release couldn't arrive at a worse time for the title insurers providing a misunderstood promise of the American dream. The Worst Possible Timing The title industry once possessed a "moral high-ground" that has eroded scandalously over the past decade.  Last November, Forbes Magazine published an … (25 comments)

title industry: The Dirty Little Secret in the Title Industry - 05/22/07 03:19 AM
Tens, even hundreds, of millions of dollars pass through title company escrow accounts each month.   The money technically belongs to consumers in the form of purchase money funds, seller proceeds, payoff funds, or refinance loan proceeds.   The title company is simply the guardian of the funds. The questions at hand: Who is retaining the interest earned on escrow accounts?  Is it the title company?  Have buyers and sellers received a disclosure explaining that the title company is earning substantial additional fees?  The interest retained by a single title company at the end of the year can be staggering as you … (122 comments)

title industry: Whispers - 01/24/07 11:56 AM
I posted this article on Title-opoly earler today and thought that it might be of interest to some.  Keep in mind, it's my personal opinion. 
Last week, First American announced the release of a new product named TitleSmart.
TitleSmart equips lenders with the ability to procure a title commitment within minutes at a refinance "point of sale". From the press release:
In initial testing, TitleSmart delivered a title qualification or title commitment - protected by full title insurance - in less than 1 minute on more than 63 percent of refinance loans in 44 states. Beta testing will begin this month with two top … (7 comments)

title industry: Thought you might enjoy this - 01/18/07 11:45 PM
I always enjoy the banter on AR about the realtor's code of ethics.  At least you have a set of rules that seem to make sense to most of you.  I want to share the code of ethics published by the American Land Title Association.  Keep in mind, the land title industry is responsible for tens of billions of dollars of annual revenue while employing a significant number of people.  ALTA estimates that 100,000 men and women work in the profession, I suspect the number is much higher.   The document itself is comprised of 276 words with a prologue of 178 words.  It is in a word, ridiculous.
I'll … (2 comments)

title industry: When a Title Search isn't a Title Search - 01/14/07 10:38 PM
Recently, there's been a couple of posts on AR dealing with title insurance.   The title abstract (land records search) serves as the underpinning of every title policy and title opionion.  I've taken the time to compile a quick reference guide that should prove helpful to realtors and consumers alike.  It has no value in the states of California and Texas where title plants are relied upon, but it's probably very accurate for most other states.  The art of title abstracting has denegraded to alarming lows.  In the past, a (60) year search was the standard.  Eventually, a (40) year search became the new normal … (8 comments)

title industry: Do you have an Owner's Title Policy? - 01/10/07 01:49 AM
Do you have an owner's title policy?  It's a question I often ask groups of title executives to see their response.  Usually theres some chuckling and a little rustling in the seats.  But, its a question thats touchy and legitimate at the same time.  Doesn't everybody buy title insurance?  Isn't it as American as apple pie and the NFL?  Well, apparently not!
Problem No. 1:  A title policy isn't really an insurance policy; it's technically an indemnity contract.  There's a world of difference between the two.  Under the terms of a title policy, a policyholder must first suffer a financial loss before being reimbursed by the insurer.  The amount of … (20 comments)

title industry: More About the Title Industry - 01/09/07 12:11 AM
Last month, I briefly touched upon the findings of an investigation conducted by Washington's Insurance Commissioner, Mike Kreidler, into illegal marketing practices employed by the title industry.  See, Two Different Settlements Sheets?.  On November 21, 2006, Kreidler's office released a "Technical Assistance Advisory" that essentially serves as a user's guide for members of the title industry doing business in the state.  I highly recommend that every industry insider take the time to visit http://www.insurance.wa.gov/ to look closely at the report itself and the concisely drafted advisory language.  Is it not safe to assume that the abuses taking place within Washington are pervasive … (3 comments)

title industry: Forbes Magazine takes on the Title Industry - 01/06/07 09:17 PM
In November, 2006 Forbes Magazine ran Scott Woolley's negative indictment of the title industry, "Inside America's Richest Insurance Racket".   Referring at different times to research, interviews and the findings of an 10 month investigation conducted by the Washington state insurance commissioner, Mr. Woolley contends that the title industry has enriched itself for decades and "bilked home buyers out of billions of dollars."   Additionally, it's Mr. Woolley's opinion that automated land records will eliminate the need for title insurance and the title profession.  I recommend that all of you take the time to go on-line to read the article.  It's offered free of charge.   The … (9 comments)

title industry: Ask your Title Agent to produce a Code of Ethics - 01/06/07 10:42 AM
Consider if you will the number of different "hats" worn by a title agent during the course of any real estate transaction.   Title agents not only examine title, they are also responsible for facilitating the closing, managing enormous escrow accounts and for drafting an insurance policy that protects the interests of lender and owner.
Consider if you will the complex fiduciary duties of the title agent.  Title agents are legally bound as the fiduciary of the purchaser, lender and title insurer.  Lender is defined as the actual source of funds and not the loan officer or mortgage broker.
Interestingly, the title industry doesn't … (6 comments)

title industry: Heroes, Mentors, Role Models, etc. - 01/01/07 08:45 AM
Earlier today, Ardell DellaLoggia encouraged "Active Rain" readers to share examples of their role models in her article, "The Russian Tea Room-NYC.  I responded positively to the idea, but admittedly needed a little time to draft a proper tribute.  I was fortunate to have exposure to a number of exemplary figures while I was learning the title business many years ago. 
I believe that the credibility of the every industry has been crafted through the motives and actions of human giants.  These dedicated professionals were, and are, directly responsible for the creation of lofty benchmarks for behavioral and ethical standards.  The heroes … (29 comments)

title industry: A donut anyone? - 12/30/06 10:03 PM
You might want to think twice the next time a title company tries to buy your loyalty with expensive gifts, memberships, tickets to sporting events, golf tournaments, etc.  Or, maybe I'm wrong and that never happens. 
This past fall, HUD concluded a 3 month investigation into certain marketing practices employed by 6 Texas title companies including a number of national underwriters.  The companies offer virtual home tours on their web-sites while charging some realtors for the service and not others.  HUD determined the virtual tours to be an inducement for business under Section 8(a) of RESPA and fined the companies an aggregate amount of … (5 comments)

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Ed Rybczynski

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