Five Secrets and Scams That Title Agencies Don't Want You To Know!
Of course, we'd prefer that you settle on your home with us, but even if you don't, it's important to us that you know all the facts before you refinance or purchase your home. After all, home ownership is the All American Dream; we don't want it to turn into a nightmare for you! The most important thing to you is a clean chain of title, defined as the history of a successive ownership and transfer in the title to a tract of land. So, when shopping around for title companies, be sure to look out for the following tricks and traps. They are designed to deceive you into over-paying for a low-quality, inferior product and service.
1. Beware of Affiliated Business Arrangements (ABAs) and Joint Venture Title Companies!
Some title companies are actually wholly or partially owned by your mortgage company. Ask them outright! If the title company is connected with your broker or banker they are by law, required to furnish you with a document explaining their potential financial gain by using their "sham" title company. Do you believe a mortgage professional should be paid twice? They just direct the title order to their own title company and receive money from the title company for doing so. Many lawsuits against such arrangements are constantly being brought to light. TITLE, inc. is 100% independently owned and operated!
Why is this so important? These arrangements do not favor in your best interest. It is simply another avenue for your financial representative to make more money from your real estate transaction. Since most mortgage companies pay their employees based solely on production and as you know "time is money," these ABAs usually speed through the title process, cutting as many corners as possible to close the loan so they can get paid. Is this advantageous to you? The end result usually is that you did get a loan however; your home is still plagued with gaps in your chain of title (and they may have caused a few new ones!). Here are a few articles that have been written to inform the consumer and propose reform in the title insurance industry:
Title Insurance Cost and Competition, written by J. Robert Hunter, Director of Insurance. (see page 21 for specific state cases)
RESPA Settlement Agreements from HUD.gov. (numerous agreements in PDF format)
Fountainhead Title Group Accused of Using MD Borrowers' Funds to Give Kickbacks to Mortgage Companies, written by LawCash.
At TITLE, inc., we believe in completing the job quickly and accurately. In most refinance transactions, we settle in the same week we receive the order, purchases as quickly as one week. The difference is that we are title professionals sincerely dedicated to providing you with a clean and legal chain of title. The service a title company provides lasts forever, heck, it may even outlast your home.
2. Cheaper Title Fees are not necessarily better!
Don't be fooled by companies who advertise a "no closing cost transaction." Cheaper does not mean better. In fact, a cheap title examination may actually cost you thousands over time! So service and professionalism, not cheapness, is the true measure of a title company's quality. Believe it or not, those companies that promise "cheaper" title fees will actually issue you an enhanced title insurance policy which is not commonly required and could cost you thousands more than the lender's required coverage.
Why is this so important? Because inferior title examination can actually do more harm than good when it comes to your prized home possession. Look at it this way: would you rather your home be an asset or liability? By not transferring your home's title properly, you could face absorbent costs in repairing your chain of title or even lose the right to your property all together! "You Get What You Pay For!"
At TITLE, inc., we employ only the most qualified title professionals! Each real estate transaction will receive the utmost attention to detail and will not be a recurring problem in your future transactions. Many real estate transactions that are examined by TITLE, inc. are full of various unreleased liens, and we can assure you that the imperfection to your title will stop with us! We settle all unresolved matters prior to settlement to issue you a completely clean chain of title ownership!
3. Look out for hidden charges when shopping for a title company!
In order to drive down their advertised prices, many companies will leave out certain basic services or features that are vital to providing you with a clean title. Some companies, for example, will charge extra for each payoff ordered or release examined. Others will charge you to have a notary or attorney present, or to settle your transaction outside of normal 9-5 business hours. These companies will then "tack on" those necessary charges at the end of your financial process.
Why is this so important?
Simple: Your low-cost title transfer that once seemed like a "bargain" could turn out to be more expensive than you were originally quoted. By then, you've also wasted precious time and effort on e-mails, phone calls, etc. Who needs that kind of hassle? In one of the most important transactions of your life, you can't afford to be "taken by surprise."
When you place your title examination with TITLE, inc., you can rest assured that you'll never be overcharged for things like ordering extra mortgage payoffs, releasing additional mortgages of record, sending documents via FedEx Overnight, or coming to your home for settlement. It's all included, so the price you're quoted is the price you'll pay. Period.
4. Beware of Inferior Service!
Another way that title companies cut costs is to employ "pencil pushers" and utilize low-quality technologies. TITLE, inc. is a firm believer that the number 1 asset to a company is the staff that makes up the company! I'm sure you have heard "the chain is only as strong as the weakest link." Well, it's the same in the title process of your real estate transaction. You have no doubt gone through extensive measures to ensure that you have secured the best possible financial company and program. The title company you choose is absolutely vital to that entire process and shouldn't be taken for granted. You have the legal right to choose your title company in every financial transaction of your home: exercise it.
TITLE, inc. possesses the most cutting edge technology to ensure your loan and title documents are always up to date and ready for settlement. You could be in Minnesota and be settling on your Florida summer home. It's all the same to us! We have the secure capability to transfer your entire 60-100 page loan package electronically while retaining its sensitive quality for recordation among the Land Records.
Why is this so important? By cutting corners in the title transfer, your home could turn out to be that liability we were talking about. Try this on:
You have been searching for the perfect new home for you and your growing family. You finally find it and now need to sell your current home to make the down payment. A potential homeowner agrees to and signs your sales contract. With that commitment you begin the process to facilitate the purchase of your dream home. Two weeks later, you receive a phone call from your listing agent explaining that there are serious problems with your chain of title and it will severely delay and add additional costs to the sale of your home! You now have less profit from your sale and need to negotiate to add an amendment to extend the settlement date of your new home.
You don't need that added stress! TITLE, inc. doesn't leave these "problems" on the table for the next person. We're paid to provide you with a clean chain of title and that's exactly what you will get!
5. Check out the Company Itself!
Finally, here are 3 questions you should ask about any title company you plan to do business with:
Are they experts in title insurance, or are they just a "middleman" company that dabbles in title? (Hint: look at the company's name or website address for a clue.)
Do they have a database of satisfied, well-known customers, or just a list of anonymous "testimonials" that could have been written by anyone? Ask them to supply you with references. If they can't, chances are they don't want you to find out something you shouldn't!
Will they actually follow through on your transaction, or just skip town leaving you to start anew? Do they follow an ethical code of conduct and business practice? Do they have an actual phone number that dials through to an actual live person? (for example: 1-800-660-9025). Or do they try to hide their phone number so that you can't call them when your title isn't clear the next time you refinance or purchase?
Are they in good standing with the Better Business Bureau? How about memberships with industry organizations such as the American Land Title Association, National Association of Mortgage Brokers, Maryland Association of Mortgage Brokers?
(OK, that's more than three questions. But these are all important things to look out for!)
Remember: There is NO substitute for a professional TITLE company. Make sure you are in a position to "Just Settle It!"
TITLE, inc. (Home Settlement, inc. in FL, OH, PA)
Executive Plaza III
11350 McCormick Rd., Suite 601
Hunt Valley, MD 21031
Phone: 410-752-8188 Fax: 410-752-8388