Who doesn’t love a good bargain?? It’s such a rush finding your size in the shirt you were eyeing, and then seeing the price cut in half on the tag! That high you were feeling comes to a crashing halt when you show off your new purchase to others. You may even hear the dreaded, “That was in the clearance section for a reason” line. Stepping back and seeing the shirt with new eyes, you realize it wasn’t worth your money. That “amazingly low price” you are seeing on your title estimate is also there for a reason. Let me explain.
Home buyers, like yourself, can be taken advantage of during the Title Insurance and Settlement process of home buying. It happens more than you’d think. An agency will give you a seemingly great deal on services when you ask for an estimate, only to add in more fees at the end — making the purchase a lot more expensive and not worth your money.
How They Do It
- Under the table deals
Every industry has it’s dark side, and title insurance is no different. Some title agencies make illegal deals with real estate professionals. For every settlement contract they bring in, the referrer gets a cut. You will know this is happening because the estimate may be really low and/or your real estate professional insists you have to use their title agency. Your title fees will change just before closing to help cover the kick back.
- Quantity Over Quality
Money is more important than relationships to some business owners. The client is just a paycheck, a means to an end. The low estimate may be real and the quality of service will match. To save money a person can probably overlook poor customer service but do you really need that frustration while preparing to move?
Here’s What You Can Do
- Compare Estimates
Look for missing fees. If your estimates are drastically different in cost and item breakdown, you may want to figure out which fees are missing! We find that the settlement and related fees are the most “overlooked” and inflated.
- Ask For Written Confirmation
Get it in writing that the agency will bill to estimate so there aren’t any surprises at closing. Note: an estimate from the lender (most often in the form of a Preliminary Closing Disclosure) is not actually from a title agency. You will need an estimate that shows the title agency name so everyone is held accountable.
- Communicate With Your Attorney
Let your attorney know you want to shop around for title and settlement services. If they say no, or the company they use is overpriced and has below average reviews (or no reviews or even a website…), that should be a red flag.