An on-time, hassle-free settlement would be the short and sweet answer to that question. But that wouldn't make much of a blog post, would it? So let me be more specific about what I expect from a title company to assure an on-time hassle-free settlement for my clients (and me).
Order the title, payoff and survey immediately after receiving a title order, so they can review the paperwork well in advance of the scheduled settlement.- Promptly set up the date and time of settlement with the lender, so the lender's settlement department will be ready a day or two in advance of settlement.
- Review those documents when they're received, so any concerns can be addressed well in advance of the scheduled settlement.
- Promptly provide the title binder to the lender upon completion of this review, to avoid any unnecessary delays.
- Keep me "in the loop" from beginning to end of the transaction. I do NOT want to hear from my client that the title company notified them of a problem. I want to learn it from the title company myself, and have an opportunity to help resolve the matter without any added stress to my client.
- Request preliminary instructions and charges from the lender so a HUD-1 estimate can be provided to me at least 24 hours prior to settlement - (read between the lines: the agent should provide this to his/her clients, NOT the title company). Of course, there probably are some agents who are perfectly happy to have the title company give this information directly to the clients, but the title company should not do that without the agent's knowledge and approval.
- Notify the agent if a delay in settlement is anticipated, even if it is just an hour. The buyer or seller may need to make alternative arrangements with their child-care provider or their mover, so the earlier the notice, the easier it will be to make these changes.
- Provide an attractive and relaxing waiting area with ample seating. Hot or cold beverages, depending on the season, are always appreciated by agents and clients alike.
- Provide an attractive and professional environment for conducting the settlement. I avoid taking my cases to settlement at places that stack piles of files within sight of the waiting or settlement area.
Disburse the proceeds to seller at settlement. This is allowed in my area, although I know it is not in some other jurisdictions. If it isn't allowed, be sure to provide a realistic estimate to all parties of when to expect disbursement and how it will be made - i.e., direct deposit to the seller's bank account, seller come back to pick up the check, the check will be provided to the agent to deliver, etc.- Make the payoff immediately, so seller is not charged a single extra day of interest. I prefer title companies that "overnight" the payoff, even if the seller pays that charge - it's usually less than one day's interest.
- Record the deed promptly, process and return paperwork to the lender, and make all disbursements to the surveyor, title abstractor, HOA or Condo Associations, water bill, etc.
- Record the release immediately when it is received from the lender. Failing to do this could result in problems for both the buyer and seller (who would, no doubt, consider me the perfect scapegoat).
- EDIT ADDED - James Engel commented as follows: "Pulling detailed the first time, requesting CFO (certificate of occupancy) at the prelim time, providing underlying docs for any cloud on title with the prelim, pulling permits if there is a discrepancy on sq ft from assesor and city are among other things that I would tag along". These are important additional steps if the property is new construction. I don't handle new construction so I failed to include this in my original list. Thanks, James!
'Much as I want a smooth settlement for my clients, I do have an ulterior motive. I want the title company to make me look good. With that in mind, it doesn't hurt if the settlement office slips in a compliment for me at some point during the settlement... Perhaps "Margaret's settlements always go smoothly because her contracts are so detailed" or "Margaret's follow-up has been wonderful, and that's one of the reasons your settlement went so smoothly."
After all, settlement is the last step in my client's home purchase, and this experience may be the one they remember - correction, it WILL be the one if it goes badly, regardless of how well everything else went.
I make it a practice to provide my clients with the contact information for three title companies, but I admit to having a favorite. That's Crofton's Capitol Title. They do all of these things well, AND they waive their fees for active duty military. Thanks, Capitol Title!
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Copyright 2006-12. All rights reserved.
DISCLAIMER: Information contained in this post is deemed reliable on the date of publication, but it is not guaranteed and it is subject to change without notice.
________________________________________________________________________________________
Margaret Woda, REALTOR and Associate Broker
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Long & Foster Real Estate, Inc., 2191 Defense Hwy., Crofton, MD 21114 (410) 721-1500
Margaret, what a comprehensive list of what a "great" title company offers all parties. Something to review in those times when we start questioning which title companies to work with. I appreciate the effort you put into this list. Hope you are doing well my friend.
Margaret this is a case where Real Estate works differently depending on where you are. Up here in Mass the title company and a Realtor never have communication. The title company works hand in hand with the closing attorney.
Good point, Bill - The title company is usually owned by an attorney, and they handle every detail of settlement. Agents and consumers rarely have any occasion to interact with the attorney.
Gary - Since I used to own a title company, I know what it takes to assure a smooth settlement, and I expect a title company to do it!
Hi Margaret,
I want those things as well. I have yet to find a title company like the one you have described. The last closing I had, it was terrible. The escrow officer seemed like she did not care.
Margaret- This is a really indepth post with alot of excellent post when considering who to hire as your Title Company. I love how you tied it into your favorite Title Company. It's nice to see the benefit to Active Duty Military Members. You my friend are the Crofton Maryland Real Estate Expert.
GREAT LIST, and #5 is probably my fave! Communication is absolutely key, and that communication should be through the agent first, so they can take on the brunt of the stress and let the client enjoy the transaction.
Hi Margaret, great list and it appears that Michigan works very similar to your outline. Great information, Nice post.
Margaret,
This post is right on!!! It should serve as a 'template' for title companies to emulate...If I HAD to add anything it would be these few points:
1) It goes unsaid that we 'throw in' any positive comments we can to make our referrers look good to their clients...see my number 3) below...!
2) With regard to your #5...We 'tailor' our services to fit the agent...some are adamant about being kept 'in the loop', others prefer not to be 'in the loop' with routine matters...our goal: your comfort level...
3) One last point...the final closing is the last opportunity to leave everyone involved in the transaction with a positive experience...hence, triggering future business...
Otherwise, Margaret, GREAT JOB...!
Thanks, Fran
Fran, This was pretty much our blueprint when I owned a title company several years ago. I appreciate your input, and I'm almost surprised there aren't any new steps now that so much is done online. Thanks for the added steps!
Gary, Thank you!
Ryan, That IS a biggie!
Greg - I used to own a title company, so I probably have a greater grasp of this than most agents.
Angelia - I actually have a couple to choose from, and every office of Capitol Title doesn't rise to these standards, but the one in Crofton is excellent.
Margaret- Hmmm, in my dreams! That is just never going to happen here! The buyers' lenders NEVER get the title company the documents on time. I can not tell you how many times the title comany is sent the final figures and the closing package from the lender just an hour before closing!
I also look for customer service. I am loyal to my escrow officer for all the reasons you cited but more than anything it's her willingness to go the extra mile for my clients that keeps me coming back. If I absolutely need to do a signing on Saturday or after hours I know I can count on her. I know she's busy and I don't ask for favors often but I know that if I need her she's there for me. And, most importantly, if I send out a 911 call for an afternoon chocolate fix it's there by courier lickety split!
Margaret- I love it when the title company does exactly what you laid out in your post. I am lucky that we have a few good ones to choose from locally. We have a couple that are not so good to and if at all possible I do not do business with them.
Great post and I hope that the title people are reading and taking notes!
Best,
Scott
Wonderful points in what to look for in a title co. So often I do not hear a darn thing and calls are not returned and then at the ending there are snags and stress.
Great list, Margaret. I have a favored title company here - things run smoothly, communication is open through the entire process and they bend over backwards to accomodate my clients. Funny thing is, my clients only remember the freshly baked cookes!
Margaret: It is so interesting to read articles about title companies as our attorney's handle the title searches here and that is one thing that we don't have to do here in NC! This is a very thorough list though.
Having worked in a title closing state and an attorney closing state (which is where I have worked since 1989), I enjoy the fact that the attorney writes the title insurance and there is an attorney present at the closing.
Any title company that relieves the pressure of closing the transaction is worth doing business with. Fine post, Margaret.
Bravo Margaret! Every one of your bullet point items is so important. (Our state does disberse funds at closing. More headaches are caused when a seller does not receive their funds at that time..)
Our title companies do a great job here in my town! I am always satisified ---
Margaret-I worked in a title company here is Florida (title closing state) and we always followed the above guidelines. Imagine my surprise when the last closing I did with a new title company (picked by the seller), I didn't receive the prelim HUD until I was at the closing table (which my client had to call and tell me they were on their way to closing), even though I had requested it numerous times, and then the closer got upset because I disagreed with a charge on my buyer's side. Well, guess you should have given me the prelim first! They never even contacted my buyer until the day of closing! Certainly wouldn't choose them again!
Good list to go by, thanks for sharing
Rich
Charlotte NC
Margaret,
Sometime I feel that the title company is one sided even if they claim they are fair to both sides...lack of communication can be a big problem. Now that our market sucks...I've seen the bigger companies down size and not have that assembly line type of atmosphere...I prefer the more personal companies who communicate instead of putting you on the phone with a processor who only are a paper pusher. In my area it customary for the buyer to pick title but it doesn't mean the seller can't have their docs done by their own attorney or be represented as well.
Rich - Until I opened my own title company back in the 80's, I had no idea what went on behind the scenes. Fortunately, my partner was a pro, so she taught me how to do it "right". Unfortunately, then she left down in the middle of the night and I never saw her again - but that's another story.
Lisa - When we have a title company that does this well, we take it for granted. The truth is that dropping the ball on a single step could cause delays and'/or hassles for settlement.
Norma - It's no accident they serve you well... Be sure to thank them profusely next time!
Kris - Things are going to be changing in our area soon, as lenders have a new policy - don't issue purchase paperwork until the HUD-1 is in hand from the sale. That's going to cause us to schedule settlement at least several hours apart, and possibly a day apart.
David - Thanks for the compliment!
Julie - An attorney is alway involved at some level with the title companies in our area, and sometimes they do conduct the settlement. If I have a particularly difficult situation, I request the attorney, and it's never a problem. That being said, the settlement office and office manager at Capitol Title is awesome and can handle anything - she does a great job, and the attorney is just down the hall if needed (but I've never seen it happen).
Debe - Even if attorneys handle the title search, these are the same necessary steps. If your settlements go smoothly, they are probably delegating most of the steps to an office staffer, and just handling the interfacing themselves instead of having a settlement officer do it.
Lisa - Yep, that's a really nice touch, but I had to draw a line somewhere. I've been to one settlement company where they actually have deli platters out on the last day of the month, because that's a day when they're sometimes overbooked and delays are inevitable.
Sally - So many of the difficulties are avoidable by following every step on this lilst. If one slips through the cracks, that's when there are "snags and stress."
My list was getting kinda long, and I was afraid it might be accidentally wiped out, so let me continue. As youve probably noticed, when I have a lot of comments to acknowledge, I like to start at the bottom... (By the way, it's likely to be weeks before I finish reciprocating your comments - I am light years behind right now, but that doesn't mean I don't appreciate your comments. I do!)
Neal - Personal atmosphere is one of those things like the home-baked cookies Lisa mentioned... very nice to have! At 13 items, I felt my list was getting too long, but yes - I agree with you and Lisa!
Scott - Me too!
Cecily - Chocolate? My, THAT is service! Title companies, take note!
Katerina - Until I owned a title company and learned the steps involved, I tolerated the conditions you mentioned. Once I learned there were specific steps required, and following them prevented delays or last minute figures, my expectations changed when I started selling real estate again. Now, "liking" the title company or people there isn't enough for me... they have to follow these steps and provide the quality of service my clients and I deserve. If a single step is missed, delays and hassles are much more likely.
Good list of what a Title Company should be able to do for us. I'm lucky to be associated with Prudential Fox Roach where we have the services of Trident Land Transfer. They even offer a "guarantee". Each agent should review the Title Report on their own as well. Two more eyes are better than one.
Margaret--You're absolutely right--they do assign their paralegals to do this work and simply oversee the process. The attorneys here are only as valuable as their paralegals!
My needs are simple. Get the documents to my clients a couple of days ahead of time, and don't screw up.
Great advice, excellent. I love my title company they always take my calls and prepare HUD statements in advance, and go the extra mile. I have no stratgic relationship with them they are just always available.
Margaret, All great points. It is so important that we, the clients, use someone who is knowledgeable and efficient. Great client care is what it is all about.
Margaret - Congratulations on the Gold Star for this post. Things seem to go so much more smoothly when the title company keeps the agents in the loop. I think that the title company can be your best friend or worst enemy in the transaction.
Great job Margaret...What we really appreciate is getting it somewhere near right the first time..AND if we have ordered it...Pullllllleeeeeeez don't send it to the rest of the world until we have reviewed the closing statement....have a prosperous day !
Great job Margaret...What we really appreciate is getting it somewhere near right the first time..AND if we have ordered it...Pullllllleeeeeeez don't send it to the rest of the world until we have reviewed the closing statement....have a prosperous day !
This post of course explains why you want a title company to perform outstanding service. Thank you very much Margaret for sharing this valuable information with this rookie. You are Crofton Maryland Real Estate Expert for a reason. And congratulations on the featured post.
Morning Margaret,
I too want all that and more. We are fortunate to have a relationship with a very efficient and professional Title Company. Most here locally do a fine job. It is when a seller uses one from out of the immediate area that we experience all kinds of difficulty.
Margaret ~ In addition to the items listed above, I look for a closer that is tough as nails. When there is a problem at closing, I like the closer to stay 100% calm and correct the issue as if it were no big deal. The worst thing that a closer can do is freak out the clients when they are already at a high stress level.
Ryan - I've never experienced that, but you're right. That wouldn't help. The person who trained me on doing settlements suggested the settlement officer should leave the room and let the agents and parties work out any issues. The implied warning that a solution must be reached for settlement to continue seemed to whip everyone into shape.
Hal - Consumers believe all title companies are the same, just like they often believe all real estate agents are the same. We know better!
Lanre - Thanks for the recommendation on Linked In!
Sally & David - I echo that plea!
Judy - Truer wrods were never spoken.
Audrey - So many agents don't know what's involved behind the scenes, and they accept sloppiness because they "like" someone there. No excuses accepted, when we understand it's a matter of having a proven system to keep things on track.
Missy - You and your clients are very fortunate to have someone like "my" Capitol Title.
Patricia - Ditto. It is very simple, as my first sentence indicated.
Debe - Thanks for checking back in. You're much more diligent than I am. I rarely go back to a post or to make a follow-up comment.
Judy - Hmmmm... I don't know about viewing the title report. Most agents wouldn't know what they're looking at. If you do, though, it couldn't hurt. And certainly we should review the payoff statement from the lender.
Thanks for the great post. I'm going to share this with my escrow staff. I think it's important for our team to know what our customers view as most important in the title and closing process.
One question I have is in the Denver market, we have had a massive influx of ABA title companies. I'm hearing they don't adhere to these standards that we traditional title companies try to uphold. Is it more important for good quality service, or is it more important for the agent to gain a financial incentive (or the broker of the office through the ABA relationship). I think the million dollar question is, do you choose the title company based on the great service they provide, or do you choose them for other reasons.
I believe, like Margaret spelled out, that it should be on service. It IS one of the last face to face contacts you will have with your valuable buyer and seller clients.
Pulling detailed the first time, requesting CFO (certificate of occupancy) at the prelim time, providing underlying docs for any cloud on title with the prelim, pulling permits if there is a discrepancy on sq ft from assesor and city are among other things that I would tag along
James, it sounds like you do some new construction, and those are important for new properties. Thanks very much for adding those, and I think I'll edit the post to reference those.
Wendi - I choose a title company for its service, but I can't speak for anyone else. For many years, my various companies have had business relationships with a title company and a lender, but I don't ever use them (except when a co-op company selects them). After owning a title company and being a real estate broker, I am probably more aware of legal and ethical issues than most agents - I fear that 1 in 100 case that goes bad, and part of the resulting lawsuit is defending against the accusation that the title company was more interested in protecting the commission of the affiliated broker than protecting the consumer. That's an issue I prefer to avoid altogether by referring my clients to independent title companies and lenders. And yes, you can quote me on this.
Margaret ~ Well consider yourself fortunate. I have been to plenty of closing where things got ugly. Wrong lender payoffs, incorrect notes, refusal of paying title insurance... these are just a handful of the most recent ones that I have come across. We work with great people too, but it only takes one person along to the line make small mistake that ends up being a big problem when we are all in the closing room.
Ryan - These things are messing up your settlements because the title company does not have (or maybe they have, but don't follow) a proven system. All of those things occur when the title company does not stay ahead of the game. Now that you have the checklist in this post, maybe you can find a different settlement company or inform the title company of your expectations. Using someone because you "like" them personally, they're convenient, or they have a business affiliation with your company is not nearly as important as service. Your client's settlement experience can influence their memories of you/your service, and that's why I published this list, based on my experience as a real estate agent and a (past) title company owner
Thanks for the comprehensive list of what makes for a smooth escrow period. With all the REO activity in our area, the title companies are overwhelmed and are not able to provide the service that we expect. And the most unfortunate part is that we are required to use these title companies by the bank that owns the property. Very frustrating because it makes everyone involved look bad including the real estate agent AND the lender. I am printing your post and will take it to all title companies that I am working with. Thank you.
In my market this list would be preformed more by the Escrow Company than the Title Company. There are several large title companies that have escrow departments and that is why I like to keep escrow and title in the same "group". I spent 3 years doing all the things you mentioned and I can tell you it was the WORST job I have ever held. When a company values its customers and has enough employees on hand then a transaction will go smooth. In the boom days there was just too much work and when the boom was over there were too many layoffs - First American Title in California was a joke. - Most of the time I couldn't give my customers the service they deserved and I pride myself on because I couldn't work more than 14 hours a day!
As an agent I have always requested minimal contact. Send me the pre-lim, call me with any problems I can help with, send an est HUD prior to signing, call me you have set appointments, and call me that you have recorded.
I can tell you that I have a whole new appreciation for escrow agents after putting on that hat!!! I can also tell you that real estate agents cause a ton of drama in the closing process that isn't needed.
Jo - In our area, title company and escrow company are synonymous, Jo. And I completely understand what you say about the appreciation that comes with wearing that hat!
Bob - That is frustrating for buyers and agents alike. We actually went out of business in the early 80's when banks and builders required consumers to use their own title company during a down makret, not too unlike this one. I hope that doesn't happen this round.
I just closed on a bank owned property yesterday with the title company from hell! I don't think anything on your list hapened during this transaction. I can't be too judgemental however; they are part of a law office.
Your information is very informative. Ensuring your client has all necessary information in a timely manner in addition to great communication with your title company will ease any unnecessary issues that might develop. Great job! www.dlamangan.com.
In my area the attorney picks the title company. We have a few very well known ones and I have never had any problems. The attorneys seem to stick with the major players.
I am thankful for the attention this topic is receiving. I think I read every comment and the one thing that didn't appear is the topic of pricing. That is very interesting to me to think that of all the agents and professionals commenting on what they look for in a title company, they didn't mention price. California's process is definetely different. Thanks Margaret!
Excellent points, Margaret. And may I add, if there are items that will remain of record, I'd like a copy of them for my buyers. If the easement isn't spelled out but instead points to a book and page, give me a copy. If there are CC&Rs, I'd like a copy, please. Yet, I continually find myself having to ask these title companies to provide the documents. How can a buyer make an intelligent decision about the conditions affecting a prospective purchase without documentation? Do they think buyers have time to go down to the county courthouse and pull these documents themselves?
end of rant.
I love the title company I use - I feel that the attorney there really works hard on every single one of my closings, no matter large or small!
Margaret, I have been using the same closer for 14 years!!! She is now with her 3rd title company in that time but has been with First American Title for the last 10 years or so. She's awesome!!!!!! Cara Brown goes far beyond the call of duty.
I agree completely with your very comprehensive list.
Plus......they should have delicious fresh baked cookies :)
Bryant - Sounds like we're both pretty lucky.
Emily - And you are very fortunate, too.
Elizabeth - You're right... people rarely know what clouds there are in their titile, such as utility easements. When we bought a home in Charleston, I reviewed the title myself and determined that a corner of the house ran over a utility easement - I refused to settle until the builder got a release from that, and substituted a path around the structure. My agent would probably not have identified (or fixed) that issue for me, but I did.
Greg - In my area, the business is so competitive that the price are not much different. When they are, it's usually because the title company is making the charges a la carte so some of the charges included by other companies are not included in the quote they give consumers.
Corrine - You, too, are very lucky.
Bob - That must be very frustrating... Your experience is one of the reasons I have tried to avoid showing those properties.
Margaret ... Sounds like you have found a great title company. They must be a keeper.. Thank you for sharing your list.
Great post! To bad it's not rebloggable!
Roland - Thank you!
Anonymous - All you have to do is ask, but there's no such request in my inbox.
Margaret: That's a great list. It's all about communciation for me. I've only had one bad experience with a title company. The manager wasn't feeling well, wouldn't delegate, and we closed late when we probably could have closed on time. I suppose we're all going to have our clunkers! Have a nice weekend.
Paul - Communication is important, Paul, but they need to do WHAT they need to do WHEN they need to do it. Guarantee you, the clunkers aren't doing that. I didn't realize how much is involved on that end until I owned a title company - now I appreciate a good job when someone does it, and don't take it for granted.
Number 5 is so important -- over communicate is better than under communicating
Scott... How did you find this OLD post? LOL. Yes, you're so right!