We frequently get the question, "who chooses the title and escrow company?" The answer below is from the Oregon Association of Realtors e-news letter 10.6.2010.
In our experience we have definitely seen the title and escrow company as a negotiated item in the contract. The listing agent will note their title company of choice on the MLS listing because they have already worked with said company to provide information on the property, and their favorite escrow officer is there. Then the buyer's agent writes up the offer and writes in their favorite title and escrow company which may be different.
It used to be pretty common for an agent to write a counter offer just to change the title company. This practice has tapered off in today's climate. No "rocking the boat" on transactions as getting it to close is the most important issue.
What seems to be the most rare occurrence is when the buyer or seller request to work with a specific company. This does happen but generally, they trust the real estate agent and their expertise in this matter.
Legal Hotline
Q. Our agent is both the seller's and the buyer's agent and is saying the buyer gets to choose the escrow/title company. Is there a rule about this and, if so, where can I find it? Does the type of loan matter, like FHA or VA?
A. There is no "rule," though a lot of people think there is one. RESPA says a seller cannot make the buyer purchase title insurance from a particular company as a term or condition of sale. That is really a narrow prohibition because in most sales the buyer doesn't purchase any title insurance, the seller does. The RESPA title insurance rule is often misunderstood because the title companies are the escrow companies in Oregon. There is, however, no rule, RESPA or otherwise, about choosing escrow. It is just a term of the sale contract like any other term of the sale contract. That being the case, asking who chooses escrow is like asking who chooses the purchase price. It's a negotiated term. If FHA or VA weighs in on escrow, it is as a condition of qualifying for the loan, not a law.
We hope that you will choose AmeriTitle on your listing, write us in on the offer, and extend us the great honor of serving you and your clients. When you experience our level of professionalism and fast and friendly service you'll be glad you made the AmeriTitle choice.
