It still blows my mind how many abandoned inheritance tax escrows we have every year. I've got thousands of dollars sitting in escrow that I need to get over to the Department of Revenue. They in turn will send us a release for our insured property and we can then file it at with the Register of Wills.
Each year I work with a different person at the Department. Most are just happy to get the money and send releases quickly. Last year, the person charged with dealing with our escrows was a tiny bit perturbed and the entire process was more time consuming than it needed to be.
As soon as I have a bit more free time I'll process this year's batch. Hopefully it won't turn into a make work project.
Monday, September 13, 2010
Saturday, September 04, 2010
Hello to fast reader in the Netherlands. :) May I help you find something in particular?
This is the little blog that could. ;) Title Insurance Talk sits out here in the web ether answering usually 100 to 200 questions at day. Most hits are specific queries - questions to search engines. I always hope YOU, the reader will find what you are looking for. If not, if it's a relevant question we haven't covered before, I'll do a post. Some hits are regular readers and I love seeing your visits because it feels like a little title community.
Today, I was really surprised to see close to 500 hits and the day isn't over. I wondered if I had said something that caused a stir. Unusual hit volume on this blog usually means a viral topic like the old notary signing agent discussion.
Today, I see the increase in hits is coming from one source in the Netherlands. So, just wanted to say hello and thank you for reading. ;)
Today, I was really surprised to see close to 500 hits and the day isn't over. I wondered if I had said something that caused a stir. Unusual hit volume on this blog usually means a viral topic like the old notary signing agent discussion.
Today, I see the increase in hits is coming from one source in the Netherlands. So, just wanted to say hello and thank you for reading. ;)
Wednesday, September 01, 2010
Monday, August 23, 2010
query: should buyer get title insurance on land cash deal
Unless you want to put the cash at risk, YES, buy an owner title insurance policy.
query: when does being threatened with adverse possession end
I do hope you confer with a good real estate attorney. In PA, you can evidence that you granted permission for the use, even if temporary permission and that should defeat an adverse possession claim. A good real estate attorney can advise you.
I bought a property a few years back and the survey revealed that a neighbor was using my land for parking and generally as a side yard. The land was on the other side of a creek and if I had not had a survey done, I might never have know it WAS my land. Interesting, eh? Anyway, I visited the folks and offered to sell them the land for a small amount plus the cost of doing a subdivision. They said no, so - to protect myself from an adverse possession claim - I sent them a letter giving them temporary permission to use that portion of my land. That was all I needed to do to defeat a potential adverse possession claim.
Some readers might say what's the big deal? Well, if I am paying taxes on the lot, I want to maintain control. The neighbors wanted use but were unwilling to pay, so that's life.
Adverse possession is a real threat to property owners and you should take the simple precautions available to you in the law. Ignoring the use of your property by another is not an option unless you don't care about the loss.
I bought a property a few years back and the survey revealed that a neighbor was using my land for parking and generally as a side yard. The land was on the other side of a creek and if I had not had a survey done, I might never have know it WAS my land. Interesting, eh? Anyway, I visited the folks and offered to sell them the land for a small amount plus the cost of doing a subdivision. They said no, so - to protect myself from an adverse possession claim - I sent them a letter giving them temporary permission to use that portion of my land. That was all I needed to do to defeat a potential adverse possession claim.
Some readers might say what's the big deal? Well, if I am paying taxes on the lot, I want to maintain control. The neighbors wanted use but were unwilling to pay, so that's life.
Adverse possession is a real threat to property owners and you should take the simple precautions available to you in the law. Ignoring the use of your property by another is not an option unless you don't care about the loss.
questions on a public forum
Purchased a house about 5 months ago in PA. I have talked to the guy 8 or 10 times now and he has made many excuses and promises.. and yet, I never received the original title back, or the owner's title insurance policy I paid for. I checked with the county, and the purchase has been recorded with them.
So, obviously I will try to press on him by filing BBB complaint, etc, but my concerns are:
1) Is a certified copy of the title just as good as the original?
2) Can I go to a 3rd party to obtain title insurance at this point? Is there some time limit in which it must be purchased?
3) If he didn't issue the lender's title policy (a much bigger expense than the owners), is that going to negatively affect me in some way?
4) Is there anything else I am supposed to get that I didn't?
So, obviously I will try to press on him by filing BBB complaint, etc, but my concerns are:
1) Is a certified copy of the title just as good as the original?
2) Can I go to a 3rd party to obtain title insurance at this point? Is there some time limit in which it must be purchased?
3) If he didn't issue the lender's title policy (a much bigger expense than the owners), is that going to negatively affect me in some way?
4) Is there anything else I am supposed to get that I didn't?
Saturday, August 21, 2010
question from Bob
A Lender’s Policy was issued by a Title Company for private financing in the amount of the loan on a single family home with a LTV of 50% or less. A good portion of the loan proceeds were used to cure delinquent taxes and acquire an adjacent property.
Borrower signed as a Personal Representative of an Estate with minors. Title Company failed to discover borrower’s PR status had expired. This error was discovered when borrower petitioned the Estate, represented by the Public Fiduciary, to pay delinquent loan payments and back taxes as Lender had commenced a Trustee’s Sale.
The Public Fiduciary sued Lender in Superior Court asking for a Declaratory Judgment that the Note and Deed of Trust be judged invalid and unenforceable. Lender filed a claim against Title Company who hired an attorney to represent Lender but, it was discovered, only for the amount of the Policy plus costs. The Title Company informed Borrower that Borrower must sue Title Company Escrow separately on Title Company’s E&O, a separate agency, to hopes of recovering accrued interest and penalties which are now substantial because of time elapsed.
In the parallel world of home insurance where there has been a total or substantial loss, the insured frequently hires a Public Adjustor to negotiate a settlement taking a percentage of new money when the settlement offered is not satisfactory.
Are there Public Adjustors who specialize in Lender’s Policy issues?
Hi, Bob, and thank you for your question. I have never heard of Public Adjustors in title insurance.
Loan policies insure the validity of a lien and in this case it seems that the loan policy performed.
I do not understand why the borrower would seek to hold the title agent liable for the borrower's failure to perform as a fiduciary for an estate. You might argue that the title agent could have noticed and raised the issue but the title agent was charged with issuing a loan policy as a representative of the title insurance company and in that capacity should not also be acting as an attorney for the borrower.
In fact, the question you pose does not mention that the title agent was an attorney and so in any case would not be expected to give advice to the borrower. The title agent may have presumed that the borrower had knowledge of the responsibility of the fiduciary and was able to execute the loan documents. That was an error in judgment for which the title insurance company paid a claim.
In my opinion, the borrower would not have standing to go after a title agent for an error created by the borrower's own negligence.
So, that's my non-attorney title agent two cents.
I'm not certain if this response is helpful, but I hope it is. If there are readers out there with another take on this issue, please chime in with a comment.
Thanks for raising the issue, Bob, and thanks for reading.
Thursday, August 12, 2010
2008 taxes used for 2010 closing?
Diane: After we closed on our property we discovered the title company had made an error when they did the title search regarding the taxes. They said they based them on the 2008 taxes because the 2009 tax bills were not out yet, we closed Feb. 22, 2010. They said their title search found the 2008 taxes were $1130 when in fact the 2008 taxes were $2950. The amounts that were allowed for taxes during closing was short by over $1,800. We purchased title insurance with the understanding that this would cover us in the event of an error such as this. Who should be responsible for the under payment for the taxes? We went to the title company first, they jerked us around for several weeks before they finally submitted the claim to the title insurance company, now I think we are being given the run around by the insurance company. We just need to know who should be responsible for compensating us for the $1,800 owed for 2009 taxes.The title company who made the error, the title insurance company or the bank that we purchased the property from? Does the title insurance company represent us if we need to recover the tax money from the bank? No one seems to be giving us any answers. Thank you for any information you can give us regarding this error. Kris
Hi, Kris: Here are some general comments that might be helpful. Find out when the 2009 taxes were due at discount. That date is crucial. If the taxes were due at discount before the date of the issuance of your title insurance policy, then you've got the basis for a claim against the title insurance company. Most title policies contain an exception for taxes that are not yet due and payable, so if the bills came out after your policy was issued, then this typical exception would negate a claim.
If the issue is that the taxes were underestimated when setting up a lender escrow account or perhaps underestimated in the tax proration calculations between you and the seller, that's really a harder case for assessing blame. Presumably the real estate agent or the seller would have provided tax figures when you viewed the property. Any reasonable person looking to purchase property would consider the cost of taxes when negotiating price.
The title agent has no personal knowledge of the property and so if there is an error that could or should be recognized by the parties at a closing, the parties - seller or buyer or real estate agent - have an obligation to point out the error.
Taxes do change from year to year and title agents rely upon the best information available which is usually a tax certification from the tax authority. You might ask for a copy of that certification so you can better understand what happened. Sometimes the tax collector quotes incorrect information. Sometimes the title agent hasn't done a good job of getting up to date info.
I hope this helps. Good luck with it and thanks for reading. ;)
Diane
Hi, Kris: Here are some general comments that might be helpful. Find out when the 2009 taxes were due at discount. That date is crucial. If the taxes were due at discount before the date of the issuance of your title insurance policy, then you've got the basis for a claim against the title insurance company. Most title policies contain an exception for taxes that are not yet due and payable, so if the bills came out after your policy was issued, then this typical exception would negate a claim.
If the issue is that the taxes were underestimated when setting up a lender escrow account or perhaps underestimated in the tax proration calculations between you and the seller, that's really a harder case for assessing blame. Presumably the real estate agent or the seller would have provided tax figures when you viewed the property. Any reasonable person looking to purchase property would consider the cost of taxes when negotiating price.
The title agent has no personal knowledge of the property and so if there is an error that could or should be recognized by the parties at a closing, the parties - seller or buyer or real estate agent - have an obligation to point out the error.
Taxes do change from year to year and title agents rely upon the best information available which is usually a tax certification from the tax authority. You might ask for a copy of that certification so you can better understand what happened. Sometimes the tax collector quotes incorrect information. Sometimes the title agent hasn't done a good job of getting up to date info.
I hope this helps. Good luck with it and thanks for reading. ;)
Diane
Monday, August 09, 2010
happy insured
Hi Diane, thought I would follow up to share the outcome of this title insurance claim for the costly non-permitted construction on our house...
Even though our legal matter with the sellers was far down the road (and stalled) and only then had we decided to file the claim, First American agreed to pay the full amount of the policy cap of 25K for such claims (hey, it's something!). So in this case, we're very lucky we decided to pay for the enhanced policy way back when we bought the home. I also think our intense record keeping on the matter provided the title company with the information they needed to evaluate the claim without any prolonged investigation or agony on anyone's part.
While we would have rather avoided this whole mess, at least we have found this bright spot in what we once, as first time home buyers, thought was just an obligatory part of the closing process. It was a nice feeling to realize that a signing a couple of pages and a small check resulted in this little policy that has been quietly protecting our interest all these years.
Very happy to hear that. Thanks for reporting back. ;)
Even though our legal matter with the sellers was far down the road (and stalled) and only then had we decided to file the claim, First American agreed to pay the full amount of the policy cap of 25K for such claims (hey, it's something!). So in this case, we're very lucky we decided to pay for the enhanced policy way back when we bought the home. I also think our intense record keeping on the matter provided the title company with the information they needed to evaluate the claim without any prolonged investigation or agony on anyone's part.
While we would have rather avoided this whole mess, at least we have found this bright spot in what we once, as first time home buyers, thought was just an obligatory part of the closing process. It was a nice feeling to realize that a signing a couple of pages and a small check resulted in this little policy that has been quietly protecting our interest all these years.
Very happy to hear that. Thanks for reporting back. ;)
Thursday, August 05, 2010
just curious
How many states or underwriters require a written quality control plan for title agencies? I just had an inquiry from a reader in Kentucky who is looking for a plan.
JC's response to the last post.
JC says, if anything, what he hears most often now from borrowers is, "Is that all?", and I think that's just darn exciting. RESPA 2010 has turned the world of the Good Faith Estimate on its head.
Tuesday, August 03, 2010
the great silence.....can you hear it?
I cannot remember the last time a consumer called or cried about their amount of cash required for closing.
How amazing is that? It's wonderful. It is life changing.
HUD, thank you.
Your plan worked. The new GFE and HUD-1 2010 RESPA standards have accomplished what years of training couldn't - accountability in disclosure.
Put the fear of real penalties in the hearts of loan officers and eliminate bait and switch or just plan sloppy work. You did it. You stood up to the lending and title insurance establishment and did something REAL, something that actually helped.
APPLAUSE APPLAUSE APPLAUSE
BRAVO HUD.
How amazing is that? It's wonderful. It is life changing.
HUD, thank you.
Your plan worked. The new GFE and HUD-1 2010 RESPA standards have accomplished what years of training couldn't - accountability in disclosure.
Put the fear of real penalties in the hearts of loan officers and eliminate bait and switch or just plan sloppy work. You did it. You stood up to the lending and title insurance establishment and did something REAL, something that actually helped.
APPLAUSE APPLAUSE APPLAUSE
BRAVO HUD.
Wednesday, July 28, 2010
The seller did his own title search and.....
he says someone at the courthouse did his deed for him. Hmmmm....
Well, the prior vested owner was a man, we'll call John Smith. Our seller's deed was from a woman who says she was Mrs. John Smith. The deed says John Smith is dead and that Mrs. Smith owns the property by operation of law as having been his wife.
Well, that's wrong. She wasn't in title so does our seller actually own the property?
We asked the seller to produce an original death certificate. The plan is to verify that Mrs. Smith was married to John Smith at the time of his death and try to figure out where an estate might have been raised, if any, etc.
Our seller cannot seem to get a death certificate so we say John Smith is not dead and therefore our seller does not own the property. How about them apples?
Will be interesting to see how this plays out.
Well, the prior vested owner was a man, we'll call John Smith. Our seller's deed was from a woman who says she was Mrs. John Smith. The deed says John Smith is dead and that Mrs. Smith owns the property by operation of law as having been his wife.
Well, that's wrong. She wasn't in title so does our seller actually own the property?
We asked the seller to produce an original death certificate. The plan is to verify that Mrs. Smith was married to John Smith at the time of his death and try to figure out where an estate might have been raised, if any, etc.
Our seller cannot seem to get a death certificate so we say John Smith is not dead and therefore our seller does not own the property. How about them apples?
Will be interesting to see how this plays out.
Tuesday, July 27, 2010
just a note to say hello
Our two most interesting cases pending now are one involving a Power of Attorney for a buyer and another in which the neighbor stepped forward on the eve of closing to say the driveway is on his property.
Both are cases of info coming in really late in a transaction and so both are delayed while we work out solutions.
In the case of the Power of Attorney, the buyers told the loan officer that they intended to use a POA because the husband is employed by the military and working in a war zone. He comes home once a month and was sitting right in front of the loan officer while they had this conversation. Did she think to call us or her manager? No. She told them it shouldn't be a problem and asked that they send a copy of the POA to her. Well, when we finally heard about it and had a copy in our hands, we noted that it was a general POA rather than a specific POA which is preferred when used by a borrower in a mortgage transaction.
As the title agent, the risk to an insurer when using a general POA for a mortgage is that the principal may challenge the validity of the mortgage on the grounds that they did not intend that the agent mortgage the real property. It's a stretch but it's a risk. I figured I'd reduce that risk by asking the mortgage lender to approve the general POA in writing after I had notified them in writing that it was a general POA and not the usual specific. If they said okay, then I had a paper trail for the title insurer to fight off a claim on that issue. The notice to the lender in writing - via email - fulfilled my fiduciary duty by raising the general versus specific issue to be sure the lender was making an informed decision.
The underwriting guidelines for the mortgage program absolutely require a specific POA, no wiggle room. So we did a fast prep of a specific POA including a military style notary acknowledgment and emailed it to the buyer. He, of course, if now back in the war zone and transporting this document back to us is likely to take 14 days. Their contract was for a July 31st closing so they are looking for an extension.
In the case of the driveway, folks were supposed to go out and take a look see last night. I am waiting for a call. As always, we have so far recommended to the buyer THREE times in writing that she get a survey. She has signed our survey hold harmless. Our position as title insurer is that we don't care about the driveway because she has total frontage on a public road and therefore our insurance of access is covered. As the fiduciary for the lender, however, we want to know just how much of the driveway is on the neighbor's property. If access to the driveway is totally blocked, then the lender's collateral may be diminished and they'll likely want a right of way. The lender is part of the email conversation on this pending issue so they have been fully informed.
We did find on record a survey done a few years ago which shows the house but not the driveway. We can see that the surveyor located or set three pins on the front lot line. I suggested that they take a metal detector out there last night and see if they can find the pins. The neighbor may be entirely wrong about the location of the lot line and the driveway.
If we are talking major blockage and the lender or buyer want it resolved, we will require a survey along with a right of way. If its just a tip of the driveway, we'll settle that with signed disclosure and written acceptance by both lender and buyer.
That's it for now. Back to work! ;)
Both are cases of info coming in really late in a transaction and so both are delayed while we work out solutions.
In the case of the Power of Attorney, the buyers told the loan officer that they intended to use a POA because the husband is employed by the military and working in a war zone. He comes home once a month and was sitting right in front of the loan officer while they had this conversation. Did she think to call us or her manager? No. She told them it shouldn't be a problem and asked that they send a copy of the POA to her. Well, when we finally heard about it and had a copy in our hands, we noted that it was a general POA rather than a specific POA which is preferred when used by a borrower in a mortgage transaction.
As the title agent, the risk to an insurer when using a general POA for a mortgage is that the principal may challenge the validity of the mortgage on the grounds that they did not intend that the agent mortgage the real property. It's a stretch but it's a risk. I figured I'd reduce that risk by asking the mortgage lender to approve the general POA in writing after I had notified them in writing that it was a general POA and not the usual specific. If they said okay, then I had a paper trail for the title insurer to fight off a claim on that issue. The notice to the lender in writing - via email - fulfilled my fiduciary duty by raising the general versus specific issue to be sure the lender was making an informed decision.
The underwriting guidelines for the mortgage program absolutely require a specific POA, no wiggle room. So we did a fast prep of a specific POA including a military style notary acknowledgment and emailed it to the buyer. He, of course, if now back in the war zone and transporting this document back to us is likely to take 14 days. Their contract was for a July 31st closing so they are looking for an extension.
In the case of the driveway, folks were supposed to go out and take a look see last night. I am waiting for a call. As always, we have so far recommended to the buyer THREE times in writing that she get a survey. She has signed our survey hold harmless. Our position as title insurer is that we don't care about the driveway because she has total frontage on a public road and therefore our insurance of access is covered. As the fiduciary for the lender, however, we want to know just how much of the driveway is on the neighbor's property. If access to the driveway is totally blocked, then the lender's collateral may be diminished and they'll likely want a right of way. The lender is part of the email conversation on this pending issue so they have been fully informed.
We did find on record a survey done a few years ago which shows the house but not the driveway. We can see that the surveyor located or set three pins on the front lot line. I suggested that they take a metal detector out there last night and see if they can find the pins. The neighbor may be entirely wrong about the location of the lot line and the driveway.
If we are talking major blockage and the lender or buyer want it resolved, we will require a survey along with a right of way. If its just a tip of the driveway, we'll settle that with signed disclosure and written acceptance by both lender and buyer.
That's it for now. Back to work! ;)
Friday, July 23, 2010
Tuesday, July 13, 2010
you probably know by now how I feel about FICO scoring...
I'm not a fan.
I think FICO got us into this credit mess by creating and supporting the false belief that automated underwriting could replace expert human analysis and judgment. Though developed as a tool, it replaced humanity in the lending process. NOW, it's time to let go.
We don't have subprime lending. It's basically gone. Hard money lenders are few and difficult for consumers to reach if at all. That means many families and individuals will voluntarily or with little other choice, start to live within their means and pay cash.
Heavens! What shall we do? Isn't this a good thing? Consumers learning to manage their money? Yes. I say it is, but it won't be a good thing if these consumers need or desire credit ever again.
Once a person recovers from bad money management and proves an ability and willingness to repay obligations, oughtn't creditors take a chance and lend? I say yes, however, I suspect lenders who rely upon FICO scoring will say no. Living without credit does not a high FICO score make.
If FICO won't change the calculations and reward conservative cash based living and lenders are married to using FICO, then how does a deserving potential reformed or new borrower find a lender?
I think FICO got us into this credit mess by creating and supporting the false belief that automated underwriting could replace expert human analysis and judgment. Though developed as a tool, it replaced humanity in the lending process. NOW, it's time to let go.
We don't have subprime lending. It's basically gone. Hard money lenders are few and difficult for consumers to reach if at all. That means many families and individuals will voluntarily or with little other choice, start to live within their means and pay cash.
Heavens! What shall we do? Isn't this a good thing? Consumers learning to manage their money? Yes. I say it is, but it won't be a good thing if these consumers need or desire credit ever again.
Once a person recovers from bad money management and proves an ability and willingness to repay obligations, oughtn't creditors take a chance and lend? I say yes, however, I suspect lenders who rely upon FICO scoring will say no. Living without credit does not a high FICO score make.
If FICO won't change the calculations and reward conservative cash based living and lenders are married to using FICO, then how does a deserving potential reformed or new borrower find a lender?
helping a consumer deal with reality
Back in April we received a title insurance order for a vacant lot on which the buyer planned to build a new home. It's a cash deal and it still has not closed. Why? Well, the seller didn't realize that he had a mortgage on this lot and now we are working through a long process of obtaining a release.
Why didn't the seller know about the mortgage? Well, the purchase of the adjacent lot was made after he purchased the main property, the lot with his house. He had purchased the adjacent vacant lot with cash. What he didn't realize is that when he later refinanced, the mortgage lender - Countrywide - took both parcels as collateral. We don't know if that was intended or simply an accident, however, it does point out how careful a property owner should be when offering collateral for a mortgage. Don't assume you and the lender are on the same page. ;)
Anyway, our transaction is further complicated because the seller hasn't been making mortgage payments. We're dealing with Bank of America - the new servicer of the old Countrywide mortgage - and they in turn must deal with Fannie Mae to get approval for the release. It's a time consuming process requiring at least one appraisal but it IS slowly moving forward.
So, yesterday I received a call from the real estate broker. She had me on speaker phone with two agents in the conversation - all talking over each other. The broker called me to say they love our company, have never had a problem, but she cannot understand why we haven't closed this cash deal - it's been over two months, etc. etc.
I pulled the file, reviewed the copious notes by DH and proceeded to explain the reality, basically as I have done here for you.
Yes, I understand that this is not what the buyer expected and that they had hoped to get construction started before school starts. No, I do not know how long Fannie Mae will take to approve the release. Can she call Fannie Mae? Sure. Do I know who to talk to? No. Will I call? No. The release was sent to Fannie Mae by Bank of America on June 29th. I think we are still in a reasonable processing time. How much longer will it take? I don't know. Two weeks? Perhaps. Six months? I doubt it.
While we were having this conversation one of the agents in the room had Fannie Mae on the phone.
[pregnant pause for effect]
I suggested to the real estate broker that the best service she could do for her buyer is to help them understand that they have a seller that simply did not know about the need for a release. Releases take time and they need to be patient. The mortgage lender and Fannie Mae are motivated to get money and as long as the money being offered for the release is reasonably matched to the value of the vacant lot, I see no reason why we won't come to a successful conclusion.
She did not find my advice helpful and basically wanted to push me into doing a brow beating upon Fannie Mae in her stead. I refused and said I would certainly make a call if I thought it would help, however, in my professional opinion the best course at this point is to be patient and wait.
When I have a conversation like that with a real estate broker I realize I may be doing so at the peril of not doing business with them again. I have found, however, that being kind and using the tough love of the truth is better in the long run. Many will see that and appreciate it and those are the real estate agents I like to work with. If I spend my time doing the bidding of a person who is not grounded in reality, the consumers I am assisting will not be well served and I will be miserable in my daily tasks. I'd rather be happy. ;)
Why didn't the seller know about the mortgage? Well, the purchase of the adjacent lot was made after he purchased the main property, the lot with his house. He had purchased the adjacent vacant lot with cash. What he didn't realize is that when he later refinanced, the mortgage lender - Countrywide - took both parcels as collateral. We don't know if that was intended or simply an accident, however, it does point out how careful a property owner should be when offering collateral for a mortgage. Don't assume you and the lender are on the same page. ;)
Anyway, our transaction is further complicated because the seller hasn't been making mortgage payments. We're dealing with Bank of America - the new servicer of the old Countrywide mortgage - and they in turn must deal with Fannie Mae to get approval for the release. It's a time consuming process requiring at least one appraisal but it IS slowly moving forward.
So, yesterday I received a call from the real estate broker. She had me on speaker phone with two agents in the conversation - all talking over each other. The broker called me to say they love our company, have never had a problem, but she cannot understand why we haven't closed this cash deal - it's been over two months, etc. etc.
I pulled the file, reviewed the copious notes by DH and proceeded to explain the reality, basically as I have done here for you.
Yes, I understand that this is not what the buyer expected and that they had hoped to get construction started before school starts. No, I do not know how long Fannie Mae will take to approve the release. Can she call Fannie Mae? Sure. Do I know who to talk to? No. Will I call? No. The release was sent to Fannie Mae by Bank of America on June 29th. I think we are still in a reasonable processing time. How much longer will it take? I don't know. Two weeks? Perhaps. Six months? I doubt it.
While we were having this conversation one of the agents in the room had Fannie Mae on the phone.
[pregnant pause for effect]
I suggested to the real estate broker that the best service she could do for her buyer is to help them understand that they have a seller that simply did not know about the need for a release. Releases take time and they need to be patient. The mortgage lender and Fannie Mae are motivated to get money and as long as the money being offered for the release is reasonably matched to the value of the vacant lot, I see no reason why we won't come to a successful conclusion.
She did not find my advice helpful and basically wanted to push me into doing a brow beating upon Fannie Mae in her stead. I refused and said I would certainly make a call if I thought it would help, however, in my professional opinion the best course at this point is to be patient and wait.
When I have a conversation like that with a real estate broker I realize I may be doing so at the peril of not doing business with them again. I have found, however, that being kind and using the tough love of the truth is better in the long run. Many will see that and appreciate it and those are the real estate agents I like to work with. If I spend my time doing the bidding of a person who is not grounded in reality, the consumers I am assisting will not be well served and I will be miserable in my daily tasks. I'd rather be happy. ;)
I get a kick out of seeing Title Insurance Talk translated into a foreign language.
Last year I noticed a post had been translated into Vietnamese. Last week I saw one translated into Spanish for a Chilean reader and then this morning I noticed another translated into Dutch for a Belgian reader. Cool. ;)
Thursday, July 08, 2010
LOL....I'm sorry but this makes me laugh.
The vagueness of the individual factors is compounded by the subjective balancing process inherent in the test. HUD explains that the ten factors “will be considered together in determining whether the entity is a bona fide settlement service provider.” But HUD gives no indication how many factors might be determinative, or which factors might weigh more heavily in the analysis. Any entity wishing to operate as an ABA (an arrangement RESPA specifically condones, with certain limitations) is thus confronted with a massive gray area. At some point within that gray area, both civil and criminal liability might attach. But the test gives no indication of where that point might be. Thus, the regulation does not contain “sufficient exactness to prevent arbitrary enforcement and give notice of what an individual must do to comply with the enactment.”Belle Maer, 170 F.3d at 559.
source document
DUH! It's gray and vague because that is what the industry establishment wanted! They specialize in lobbying for vague rules so they can make a mint teaching everybody how to interpret and beat the rules. They LOVE living in the gray because the line moves with the political environment. This is hilarious. This is fascinating and in the interest of preventing a sham explosion of any kind, I do hope HUD and state insurance regulators will take note and provide clear guidance. Need help? I'm sure there are lots of us with good ideas. ;)
source document
DUH! It's gray and vague because that is what the industry establishment wanted! They specialize in lobbying for vague rules so they can make a mint teaching everybody how to interpret and beat the rules. They LOVE living in the gray because the line moves with the political environment. This is hilarious. This is fascinating and in the interest of preventing a sham explosion of any kind, I do hope HUD and state insurance regulators will take note and provide clear guidance. Need help? I'm sure there are lots of us with good ideas. ;)
sham test unconstitutional?
The U.S. District Court, Northern District of Ohio, Western Division in Toledo, Ohio has issued a Memorandum and Opinion Order decided by Judge Jack Zouhary which holds that HUD's 10-Part Test to determine whether a controlled business arrangement is a sham entity or not is unconstitutional. The case is styled Erick Carter, et al. v. Welles-Bowen Realty, Inc., et al. and involves two controlled business arrangements operating in Toledo, Ohio which are co-owned by two of the largest real estate firms in the area and Chicago Title.
Read more on the OAITA blog.
Read more on the OAITA blog.
WILLIAMSPORT — A State College businessman who admitted embezzling $1.6 million while serving as an agent for Ticor Title Insurance Co., based in Philadelphia, has lost his bid to be given a sentence lighter than called for by sentencing guidelines.
In an opinion issued Friday, U.S. Middle District Senior Judge Malcolm Muir said while Ellery A. Crissman’s community activity may justify a sentence at the bottom end of the guideline’s range of 51 to 71 months, they are not so extraordinary to merit a departure from that guideline.
Crissman, who lives in Lock Haven, pleaded guilty in September, and is scheduled to be sentenced in August. The guideline range calculated in a presentence report includes enhancements for the amount of financial loss, number of victims (more than 50) and abusing a position of trust.
In an opinion issued Friday, U.S. Middle District Senior Judge Malcolm Muir said while Ellery A. Crissman’s community activity may justify a sentence at the bottom end of the guideline’s range of 51 to 71 months, they are not so extraordinary to merit a departure from that guideline.
Crissman, who lives in Lock Haven, pleaded guilty in September, and is scheduled to be sentenced in August. The guideline range calculated in a presentence report includes enhancements for the amount of financial loss, number of victims (more than 50) and abusing a position of trust.
on support of TARP
Against lots of vocal opposition, I supported TARP. This is why. The assistance was necessary to stop a spiraling dynamic and prevent a banking disaster. It was a carefully thought out plan with a way to recover funds when the danger was clear.
The unfortunate unintended consequence was that politicians across the nation saw it as a GO signal to borrow in previously unthinkable levels against the future wealth of the nation under the guise of protecting the NOW without any real understanding of what they were doing to the FUTURE.
For at least a year prior to TARP I had been watching the big three - Bair, Bernanke & Paulson - react and carefully work as a team to navigate the financial markets through what was certainly the most rocky and scary happening since the Great Depression. I know they approached the extremes of the TARP plan with fear and reluctance. Who would have guessed, certainly not me, that it would trigger a demonstration of full blown economic idiocy by our politicians.
If they HAD been able to see the unintended consequences, do you think they would have proposed the TARP plan? It's a hard call, but I'd have to say NO. I think they'd have more carefully disguised the anticipated cost and perhaps approached the fix incrementally rather than lay out a gameplan for approval of BILLIONS in one vote. They inadvertently gave the spending addicts in power a "how to" lesson in tapping into the nation's wealth. Like stupified lottery winners politicians have gorged on the thrill of spending and we still don't really know how that story ends but I have to say TARP started it and WOW, what a hard lesson. I just had no idea how really ignorant most politicians are. I always kinda thought it was a disagreement of principles but now I think it's just plain ignorance.
The unfortunate unintended consequence was that politicians across the nation saw it as a GO signal to borrow in previously unthinkable levels against the future wealth of the nation under the guise of protecting the NOW without any real understanding of what they were doing to the FUTURE.
For at least a year prior to TARP I had been watching the big three - Bair, Bernanke & Paulson - react and carefully work as a team to navigate the financial markets through what was certainly the most rocky and scary happening since the Great Depression. I know they approached the extremes of the TARP plan with fear and reluctance. Who would have guessed, certainly not me, that it would trigger a demonstration of full blown economic idiocy by our politicians.
If they HAD been able to see the unintended consequences, do you think they would have proposed the TARP plan? It's a hard call, but I'd have to say NO. I think they'd have more carefully disguised the anticipated cost and perhaps approached the fix incrementally rather than lay out a gameplan for approval of BILLIONS in one vote. They inadvertently gave the spending addicts in power a "how to" lesson in tapping into the nation's wealth. Like stupified lottery winners politicians have gorged on the thrill of spending and we still don't really know how that story ends but I have to say TARP started it and WOW, what a hard lesson. I just had no idea how really ignorant most politicians are. I always kinda thought it was a disagreement of principles but now I think it's just plain ignorance.
Wednesday, July 07, 2010
just got freaked out by a tax collector
If you live in a metro area or some other place of the country with professional tax collection, you just probably cannot believe how we collect property taxes in most of Pennsylvania. Each municipality has an elected official in charge of the tax collection. Many are part-time and work out of their homes.
I just got off the phone with a new tax collector who called because she could not match up the amount of our check with the taxes owing. We sent in tax at penalty having just missed the face due date of 6/30. The face amount is $86.61 which makes the tax at penalty $95.27.
This young lady doesn't understand how to calculate percentages, doesn't know what a penalty is and is sort of out to lunch on the collecting property tax business. Apparently her mother used to be the collector and now she has the job. Wow.
I cannot blame this young lady. She seems nice enough and you don't know what you don't know until you know it, eh? I've got to say the system ought to have a better selection process or perhaps her mother should have taken the training to a level of adequacy.
On another tax collector freak out note, I am taking a tax collector to the district justice because he collected the same tax twice and refuses to release the funds. He also refused to claim the certified letter we sent. We'll be sending the constable for him soon.
I just got off the phone with a new tax collector who called because she could not match up the amount of our check with the taxes owing. We sent in tax at penalty having just missed the face due date of 6/30. The face amount is $86.61 which makes the tax at penalty $95.27.
This young lady doesn't understand how to calculate percentages, doesn't know what a penalty is and is sort of out to lunch on the collecting property tax business. Apparently her mother used to be the collector and now she has the job. Wow.
I cannot blame this young lady. She seems nice enough and you don't know what you don't know until you know it, eh? I've got to say the system ought to have a better selection process or perhaps her mother should have taken the training to a level of adequacy.
On another tax collector freak out note, I am taking a tax collector to the district justice because he collected the same tax twice and refuses to release the funds. He also refused to claim the certified letter we sent. We'll be sending the constable for him soon.
Tuesday, July 06, 2010
short sale lender wants buyer docs? why?
This is a first. We just got a post closing request from a real estate broker for "a copy of the Note, Homeowners Insurance Dec Page and paid receipt, Approval letter from lender or and Amended approval Letter."
Say what? Why? What business are these personal buyer documents to the seller's mortgage lender?
Here's my response:
"To guard privacy, we release documents when requested by the principal. As the documents you are requesting are buyer documents, I need a written request from the buyer directing that we release them to you. They can fax it to me [724-238-7830] or send me an e-mail."
If the buyer wants to share, I don't care but I do wonder what this is all about. We read the terms of the short sale prior to close and there is nothing in there which indicates that this documentation is part of the deal.
Say what? Why? What business are these personal buyer documents to the seller's mortgage lender?
Here's my response:
"To guard privacy, we release documents when requested by the principal. As the documents you are requesting are buyer documents, I need a written request from the buyer directing that we release them to you. They can fax it to me [724-238-7830] or send me an e-mail."
If the buyer wants to share, I don't care but I do wonder what this is all about. We read the terms of the short sale prior to close and there is nothing in there which indicates that this documentation is part of the deal.
Sunday, July 04, 2010
query: title company will stop pay on refund check unless new HUD is signed
Interesting topic. If you check the documents signed at closing you should find one or more in which you, the borrower in a mortgage transaction, agreed to cooperate and sign corrective documents as necessary.
If the title company has been charged by the mortgage lender or some other party to have a corrective HUD-1 signed and you are not cooperating, they may choose to use whatever means they have at their disposal to get your cooperation.
Stopping payment on a check is one way to get your attention, eh?
If the title company has been charged by the mortgage lender or some other party to have a corrective HUD-1 signed and you are not cooperating, they may choose to use whatever means they have at their disposal to get your cooperation.
Stopping payment on a check is one way to get your attention, eh?
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