Monday, October 08, 2007

overcharges in Somerset PA, competition, and fiduciary duties

A local bank recently opened its own title agency. The ABA is an agent of Chicago Title.

I have an opportunity to review a settlement statement and I see that both buyer and seller paid attorneys $150 each for document preparation and other services. I see that the buyer paid notary fees of $20 and that both parties paid combined courier fees of $35.50.

Lastly, I see a mortgage payoff on the seller side of an institutional mortgage that, based upon the figures alone, seems highly likely to have been originated within the last 10 years. With that info in mind, I checked the title insurance premium and see that the buyer was charged a basic rate rather than the reissue rate for which he clearly would have been eligible.

The basic rate is $958.75 and the reissue rate would have been $862.88.

I can tell from the structure of the fees on the settlement statement that the bank owned title agency is operating under the agency program and not the approved attorney program and that means that TIRBOP rates apply including required discounts.

If these consumers had used our Choose & Save Program, the seller would have saved $165.50 and the buyer would have saved $265.87.

Isn't that amazing?

1 comment:

Doug Miller said...

It is expected. ABA's don't compete for business, they are spoon fed clients who have been carefully prepped to pay more. Its a perfect marketing scheme. Get clients to rely upon your advice and then advise them to close with your own title company that charges more than everyone else. Its a great way to print money.