Tuesday, January 13, 2009

RESPA violation? What do you think?

We've got a regional law office soliciting business from mortgage lenders by offering to perform telemarketing on their existing customer base. The deal is that they solicit refinance applications for the lender in exchange for the guarantee of the title order.

Is this a RESPA violation? I think so. What do you think?


Interestingly, we had a closing the other day in which the seller had been referred to this law office by the listing agent for deed prep. This law firm charged $195 which is far higher than most law firms in the area, besides which the seller was eligible for free deed prep by our office since the buyer had opted into the Choose and Save program.

Add to that - the law firm NEVER delivered the deed to us or to the agent or to the seller. They showed up empty handed so we used the fax draft from our file. Some service, huh?

When I run across a competitor like this, I do shake my head. They are all about giving something to get something but it's never about giving the consumer a good deal.

We at The Closing Specialists made our choice long ago. We are consumer-centric in all aspects of our business. Mortgage lenders and real estate agents who care about the quality of service and the cost of settlement services direct orders to our office and I can sleep at night.

4 comments:

Anonymous said...

Let's see, the law firm is providing a thing of value to the mortgage lender (telemarketing that results in new business) in return for business (the title order); sounds like a RESPA violation to me. I also wonder what the Pennsylvania Board of Professional Responsibility might think.

Mr Mogul said...

The mortgage lenders have the relationship with the customers on the marketing listing, not the law firm. Any customers who have subsequently registered on the Do Not Call/Do Not Solicit registry are off limits to the law firm.

The mortgage lenders themselves only have 6/9/12 months to contact the customers legally, even if they are on the list of people who don't want to be called. How come? Because the lender has a prior customer, who they are allowed to contact.

The law firm is doing telemarketing to get a guaranteed client, in lieu of buying an unreliable list, and hoping for a client.

Won't the customer's know they have no rapport with the law firm? Won't at least one of the customers ask the question: Who are you and why are you calling me? And, where did you get my name from, anyway?

Anonymous said...

Absolutely a RESPA violation; if it looks like a duck.....

Kathy Glor said...

Giving something of value at little or no cost, even I feel violated by this one, and I am in Indiana! ;)