End of the Month Circus

It's the last day of the month and our office is a total circus...and that's a good thing. Every where I turn someone is frantically trying to finish their work so everything is complete for the next closing. The last few months have been slow and while the end of the month was generally busier than other times it was never like this. It's a complete madhouse. Everyone is yelling across the office and every once in a while I see a blur running by with important documents that needed to be done yesterday.


While everyone is stressed out and all over the place there is a sense of happiness and comradarie. We are all working hard but everyone is happy and ready to jump in if someone needs some help. After the last few very slow months everyone in our office is hoping that this renewed activity is a sign of things to come. Tomorrow, we will all be able to slow down and catch up with lower priority tasks but until then it is time to go back into the whirlwind...

5 Real Estate Closing Disasters

Most real estate closings seem to be very smooth and easy at least to most consumers. They may have to sign too many documents but in most cases there is no drama. You go in, sign a bunch of papers, and leave with keys to your new home or a check from the sale of your home. Of course that is not always the case. Every once in a while there is a closing disaster that keeps you from completing the transaction and may even result in the transaction never happening.

myClosingSPACE.com has put together the Top 5 Closing Disasters and without further ado here they are.

1. Not Enough Money to Cover Closing Costs: Paying closing costs requires a certified check. That means that if you are short you can't whip out your check book and write a check for the difference. And what if you are short thousands of dollars? Most people don't have that much extra cash laying around especially after paying the original estimate. That's why it is important to get a guaranteed quote from your title company and work directly with them throughout the process. By working directly with your title company you will learn of any problems before you get to the closing. They will also work to take care of any problems that so you won't have to deal with surprises when you sit down to sign the documents. And with a guaranteed quote you can be assured that you will not pay any more than the quoted closing costs.
2. You Have Judgments Against You: Since your kid is going off to college you decide yo be a nice parent and buy him a car to get around. You put the car in your name. Unbeknownst to you the kid is parking the car wherever they want and racking up traffic tickets that go unpaid. Now you want to buy a home and when you site down to close you see an extra person there with their hand in your pocket. That's when you find out that your kid has racked up $6000.00 in parking tickets and they need to be paid before the closing can commence. These type of judgments can halt a closing and unless you have been in contact with your title company you may not learn about it until it is too late. If you work directly with your title company they will let you know about these issues and help you take care of them before closing so the transaction can go through without a hitch. Unfortunately, you are on your own with your kid.
3. Can't Coordinate the Closing: So you found the home of your dreams, got your mortgage, and you have scheduled the closing date. Great right? But what happens if you get there and find out the seller is in jail? If you can't coordinate the closing in a timely manner you could lose the home of your dreams. If the seller is in jail and you don't find out until you get to the closing table you may lose the opportunity to finish the transaction. If you are in direct contact with your title company you would know this before it is too late and either make arrangements to close the transaction at a later date or even withdraw your offer and look for a new house. It may be too late to do either if you don't know until the closing date.
   
4. You Find Out the Home you are Selling is Community Property: So you met your lovely wife a year after you bought your house. Your wife loved your house so instead of moving to a new home you both agreed to live at the house that is in your name. Everything is great until the day that first child arrived. Then your house became far too small and you needed a bigger house. Great, you go out and find the perfect home and someone wants to buy your home. You schedule closing on the house you are selling but it is at a time when your wife is going to be in Germany for business. No big deal since you owned the home before you met her and she was never added to the mortgage, right? Wrong, in most states when you get married the home you owned before the marriage becomes community property even if your spouse has not been officially included. So no you are at closing and the process can't be completed because your wife is not present to sign the documents. Not only do you lose the sale but now you are in jeopardy of losing the new house you want to buy. If you would have been working directly with a title company they would have been able to inform you that your wife would need to sign the documents too. The title company would be able to take care of this by having her sign the documents before the closing or set a different closing date so she could be present. Either way, direct communication with your title company would have kept your from losing the sale and losing the new home.
5. Your Lender Went Out of Business: This is a big one lately. With all of the sub-prime mortgage issues and many mortgage lenders going out of business many potential home buyers and those refinancing get to the closing table only to find out their lender went out of business and they no longer have funding. The last thing you want is to walk into your closing ready to get the keys to your new house or get a new mortgage with lower payments and walk out facing the possibility that you could lose your home. By working directly with your title company you can avoid this situation too. Since the title company is involved in the real estate business they will know about potential problems that a lender is facing and refuse to work with them. If you know this you can shop for a new lender before it is too late. Your title company may even be able to assist you in finding a qualified lender. If you know about it early you can save the deal but if you don't learn at closing it can be too late.

Buying a new home should be a great occasion and it usually is. Make sure it is a positive experience by being involved in the process and working directly with your title company. They can help you understand the ins and outs of the real estate transaction and avoid closing disasters.

Why Would I Shop for Title Insurance?

With everything that needs to be done when buying a new house or refinancing your mortgage why should consumers add to their stress by shopping for title insurance instead of letting the mortgage broker, attorney, or real estate agent do it for them? After all, they are the experts and it is one less thing that the consumer has to deal with. While it may seem that shopping for title insurance will make the process even more stressful the truth is that by taking a bit of time to find the best price for title insurance consumers can save hundreds or even thousands in closing costs. And in fact shopping for title insurance has been made fairly simple and painless as more title companies have increased their Internet presence. With a few simple searches online consumers can get multiple title insurance quotes from which they can find the title company that suits their needs.

How to Shop for Title Insurance?

In the past shopping for title insurance would have been a difficult and time consuming task. After all, most title companies only want to work with real estate professionals and you had to seek them out in the phone book and call them on the phone. Then, if they would actually work with a consumer they would have to take your information over the phone or meet you in person to get it. From there they could make an estimate. The consumer would have to keep track of the different estimates on their own and compare prices.

With the rise of the Internet and consumer friendly sites it is easy for consumers to do a few quick searches at Google or any other search engine, find a few title companies, and request a quote. Some title companies still do not have any easy way to get an immediate quote but there are others who give consumers an instant and free title insurance quote. Once you get a few quotes (at least 5 for a good comparison) you can review them and choose the best company. Best of all with computers it easy to keep track of all these quotes.

How to Tell Which Quote is the Best?

When consumers get their title insurance quotes they will probably see a variety of different prices. While many states regulate the cost of title insurance there is no regulation on the related fees and charges and that is where most companies differ. On top of that some companies will provide a quote for both Owners and Lenders title insurance while others will only include Lenders title insurance. To be sure the comparisons are valid every quote should use the same criteria.

To get real comparisons consumers need to get the Good Faith Estimate from their lender or at least provide the real price of the home and exactly how much the loan is worth. Once they have that information they can go to each title company and get a real quote. Make sure to ask the title company if their quote is guaranteed and includes both the Owners and Lenders policies as well as all related charges. The last thing anyone wants is to find out they need to pay more when they sit down to close. Once it is verified that every quote is using the exact same criteria and represents exactly what will be charged at closing they can be compared.

How to Compare Quotes?

Now that the quotes are in the consumer’s hands they can compare the quotes. Comparing on price is easy and if that is the only consideration then consumers can simply choose the company with the best price and use them. Other consumers may want to include other factors such as service, availability (do they allow the consumer to choose where and when they want to close?), or any number of factors. Weigh the factors and make a choice based on the most important factors. And remember it is the consumer’s choice. The real estate professionals the consumer is using can offer suggestions and referrals but in the end the consumer has the right to choose their title company. If a consumer is being pressured to use a referred title company they want to ask themselves why? In many cases it is because the real estate professional is being paid by the title company for that business. And guess who pays for that illegal kickback or referral fee?

Take Control and Save Money

While it may seem daunting at first consumers who take control of the process and choose their title insurance will end up saving considerable out of pocket expenses. And the reality is it is not that difficult. A few minutes online can produce multiple quotes that could translate in savings of hundreds and even thousands at the closing table. Take control of the transaction and save money.

Review: Successful Marketing Strategies for Today’s Title Companies

Shane Kane at Titlesuccess.com has created a new guide called Successful Marketing Strategies for Today’s Title Companies. The guide offers some great advice on how to market title companies in the current slow market. With the slowdown in the real estate market many title companies are having a hard time finding and keeping quality leads and this guide offers some great advice for struggling companies.

The marketing guide gives a lot of good basic information about the challenges facing title companies, how to build relationships with quality partners, and how to take control of your title business in the Internet age. Struggling title companies would do well to utilize this resource and take advantage of the advice he provides.

Some of the points he discusses:

• Firing the unrealistic clients and targeting quality and desirable clients. Gives details on what questions you should ask yourself regarding which clients are the best to work with, most profitable, and provide the best opportunity for growth.
• One of my favorite aspects is the discussion of different tactics to help you market to different actors in the real estate transaction. Each individual in the transaction has a different perspective and you need to adjust your marketing plan for each individual. The guide gives a breakdown on how to market to realtors, mortgage brokers, banks, and individuals. It even breaks down the best way to market to different levels of each professional like local brokers vs. national brokers, etc.
• Another important discussion is how your website can help you deliver your message and assist your clients when you are not available. The guide provides information about what your website should contain and how it should reinforce your message. This is an area that many title companies have ignored for too long and the best companies need to move forward and work on their web presence.

Again, this guide has a lot of information and would be a great resource for a new title company just starting out or an established company looking to improve their business in a slow real estate market. Visit titlesuccess.com to find the guide and take a look at some of the ideas he presents in his blog.

Shop For Title Insurance

As more and more consumers are learning about the malfeasance of some title insurance companies there is an increasing demand for more information and the ability to shop for title insurance. Here at myClosingSPACE.com we believe the tide is beginning to turn and the new model of consumer friendly title insurance is going to take over. This is a good thing for consumers and it is our hope that more consumers will educate themselves and make the effort to shop for title insurance.

We have been advocating this position since our inception but it appears that others have started to jump on board as well. Organizations like ALTA and CLTA have recently released new tools that allow consumers to learn more about title insurance and inform them that they should shop for their title company. Consumers can save a lot of money at closing if they just take the time to shop for title insurance.

The new ALTA site provides good information that consumers will find useful in learning about title insurance and how they can save money. Armed with this information consumers can then use the Internet and other sources to shop for and make an educated decision on where to get their title insurance. The new CLTA tool, Title Wizard, allows California residents to get comparison quotes from multiple title companies and choose the best price. IMO Title Wizard should be used as a starting point and after getting those quotes consumers should still use all of the resources at their disposal to find the best title insurance provider.

The old title company business model is on the outs and is being overtaken by new title companies that work for the consumer. We need to keep the pressure on and continue to educate consumers so the entire industry changes and becomes the consumer focused product it should be.

Foreclosures Fell in September

According to a new CNN article the number of foreclosures in September fell by 8%. CNN cites a recent RealtyTrac article that shows foreclosures falling. There are some questions as to whether this is a momentary lull or if it is the beginning of a trend out of the foreclosure doldrums. They also speculate whether the drop is due to potential foreclosure properties being bought or if the market is beginning to correct as defaults were down over 200,000 as well.

The Sun Belt and Rust Belt states were still among the hardest hit but even they are showing some improvement. Let's hope that this is a trend moving in the right direction. As more refinancing options are being made available we could see more and more consumers who were facing foreclosure able to pull themselves out of it. It is good news in the short terms but it needs to be watched closely to see if the improvements continue or if it was a momentary lag.

New Consumer Tool in California, Title Wizard,

So California has introduces a new tool, called Title Wizard which allows consumers to compare title insurance prices so they can make their own choice. Diane has already written about this and while I agree with her that this information has been available for a while to anyone with a computer and an Internet connection. I have to take issue with her saying it is lame. It may be late to the game and there may be issues that need addressing to force a real change I still like that California is trying to educate consumers about title insurance. I still believe that too few consumers never hear about title insurance until they are actually signing the closing documents. By then it is too late to shop around and they are generally stuck paying too much for their title insurance and closing costs. If Title Wizard is able to educate more consumers and compel them to actually shop for title insurance it will go a long way towards cleaning up the industry and making it more consumer friendly. If those people tell others and the word spreads it could really force a change.

I am generally for the free market and against government interference but if government is going to step in this is a good way to do it. They are not actually piling on useless regulations or meaningless platitudes but simply allowing consumers to compare prices on their own and choose their own title insurance provider. Obviously there are number of private companies doing the same thing but they do not have the PR power of California state government. Once people realize they can compare and shop they will actually start going to Google and other search engines to find providers. It may not be a huge step but IMO it is another small step that can help propel the industry into cleaning itself up and providing consumer focused service.

Diane Hits Another One Out of The Park

Another great post by Diane Cipa over at the Radical Title Talk Blog. This post is about the need for change in the title industry and she hits the nail on the head with this, "I have one piece of advice for lawmakers and regulators. Create simple laws. Choose your side. Make it black or white, but don't pretend there is a shade of gray that will solve anything." And she is 100% correct. If there is any way the law can be "interpreted" it is left open for the shadesters to jump in and create their sham arrangements, which will cost the consumers more and more.

If those at the top actually care about change and protecting consumers they will get rid of the gray areas and state emphatically that paying for business is illegal. Setting up sham ABA's to steer business is illegal. And anything besides honesty and truthfulness towards consumers is illegal. And strong sanctions and punitive fines will go along with the new laws not the current piddly fines that are simply a cost of doing business to many title companies. Put some teeth into the law and make sure that those who are cheating the system (and consumers) pay a strong enough price to deter others from doing the same thing in the future.

Let's clean up this mess once and for all.