Friday, August 22, 2008

the affiliated title agency took the deal - almost without insurance

In PA title agents aren't permitted to perform services without the issuance of title insurance. This case was interesting because the lender - a local bank doesn't require title insurance. When we get an order from them - which is rare - we always call before processing to confirm that the buyer has requested our services and that they are purchasing title insurance.

What I found most fascinating is not so much the cancellation but that the real estate agent and her affiliated title agency - a large regional operation - pulled the deal at first by saying the buyer was NOT getting title insurance. I called the real estate agent and raised the subject of our licensing authority and after a pregnant pause, she switched gears and said they were issuing title insurance but they were switching the transaction anyway. I then received a call from the president of their title agency - who should know better, he's been in the biz for a long time - who wanted me to NOT bill for services rendered so their theft of services would be all that more smooth. Well, you know he didn't put it that way but that's what he was driving at. Anyway, in support of title agents everywhere who need the words with which to defend your work product. Here's the letter I sent to the consumer today:

RE: title cancellation

Dear Mr. redacted:

I have received your note in response to our invoice, which says:

“I do not know what this bill is for, at no time did I request your services, sign for your services or receive anything that/from looked like you performed any services on my behalf.”

I do not wish to incur any additional unnecessary costs and so I am not sending the entirety of our file with this letter, but be advised that our work product and raw supportive data are substantial and will be entered as evidence should we be forced to take the matter to the district justice.

These are the facts:

  • June 5, 2008 You entered into a sales agreement to purchase real estate and agreed to pay for title search and cancellation, if any. [See 6-D-4 and 19-B]
  • July 1, 2008 On the strength of the sales agreement and direction from you, redacted Bank sent a letter to our office ordering title service on your behalf. [I personally called the bank and spoke with redacted before processing the order. As the bank does not require title insurance, I wanted to confirm that you were purchasing title insurance so that we would comply with our license authority. She confirmed that you instructed the bank to send the title order to our office and that you wanted title insurance.]
  • July 2, 2008 We processed the title order and mailed a letter to your home notifying you of the order in process. This letter was not returned by the post office and so therefore can be presumed to have arrived.
  • July 7, 2008 The bank continued to process the order with our office and faxed the sales agreement for our file.
  • July 8, 2008 Your real estate agent called our office to say you were not going to use our services and that you were not purchasing title insurance. She asked that we cancel the order. We attempted to cancel the title work, however, it was too late, the abstract was complete and the report was en route to our office via mail. I called your agent to let her know and in the course of the conversation she switched gears and then told me that you were buying title insurance and that she was directing the title order to her affiliated business. I then received a call from the president of their agency and in the course of that conversation informed him that the work had already been done and that we would be invoicing for cancellation.
  • ·July 9, 2008 We sent an invoice to your home.
  • ·July 14, 2008 Before retiring the file, I decided to mail you a copy of the title commitment so you would have a copy of the work product for your file.

We paid out of pocket $155.00 to cover the cost of abstract and lien certificates advanced to process your file before receiving the notice of cancellation. Recovery of those expenses and payment for services rendered in connection with your title order are the basis for the invoice. I am writing this letter with an extensive explanation because I know how much effort is involved in taking the case to the district justice and I hope to avoid that step. It only adds cost to your bottom line and makes no sense. I do hope this clarifies the issues for you and I hope we don’t end up in court; however, I am prepared to take that step should you ignore our demand for payment.

Should you have a question or concern, please feel free to contact me.


Diane Cipa

General Manager

CC: redacted, Vice President Retail Lending

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