I had a rude awakening yesterday...
I was at the closing table at a local escrow company, an escrow company that has served me well over the past ten years. The escrow company and title company are owned under the same umbrella. In other words, the title and escrow company are, in essence, the same.
My job at the escrow table is to sit and observe. I do not interrupt or comment usually, unless I see something obviously wrong. If something is wrong, I know who to contact to get it fixed as quickly as possible, so my clients can continue to close on time.
I typically do not have many issues at the closing table, because I always request the closing statement be sent over to my office prior to the signing date. If anything is amiss, I can fix it before it becomes an issue.
As I was glancing over the closing statement for a final review, a charge jumped out at me, a charge that had not been on the closing estimate the day before.
"Excuse me, can you explain what a 'Reconveyance Verification Fee' is?"
The escrow officer explained that it is a fee that their headquarters charges to have someone verify that the bank holding the seller's loan actually reconveys the title, or clears the loan.
Umm, what? Isn't that what the title and escrow companies are for? The title and escrow companies are responsible for granting clear title. That's why the seller and the buyer both purchase title insurance. If the original loan is not reconveyed, how could they grant clear title?
It's called a junk fee. Many lenders and mortgage brokers have been doing it for years. Granted, some of those fees are paid to third parties, and someone has to pay them. That is why those fees gets passed on to the buyer. However, in this case, the escrow company is collecting the money and passing it on to their headquarters. So technically, they don't keep it and can therefore collect it.
Taking that a step farther, couldn't they do that with their franchise fees? Postage stamps? Employee wages? They don't get to keep those either!
I can not stand junk fees! If it is a cost of doing business, just up the one fee and get it over with. Tell me what it's going to cost. If you do a good job, I won't have a problem paying your fee, but don't nickel and dime me, or my clients, to death!
I was at the closing table at a local escrow company, an escrow company that has served me well over the past ten years. The escrow company and title company are owned under the same umbrella. In other words, the title and escrow company are, in essence, the same.
My job at the escrow table is to sit and observe. I do not interrupt or comment usually, unless I see something obviously wrong. If something is wrong, I know who to contact to get it fixed as quickly as possible, so my clients can continue to close on time.
I typically do not have many issues at the closing table, because I always request the closing statement be sent over to my office prior to the signing date. If anything is amiss, I can fix it before it becomes an issue.
As I was glancing over the closing statement for a final review, a charge jumped out at me, a charge that had not been on the closing estimate the day before.
"Excuse me, can you explain what a 'Reconveyance Verification Fee' is?"
The escrow officer explained that it is a fee that their headquarters charges to have someone verify that the bank holding the seller's loan actually reconveys the title, or clears the loan.
Umm, what? Isn't that what the title and escrow companies are for? The title and escrow companies are responsible for granting clear title. That's why the seller and the buyer both purchase title insurance. If the original loan is not reconveyed, how could they grant clear title?
It's called a junk fee. Many lenders and mortgage brokers have been doing it for years. Granted, some of those fees are paid to third parties, and someone has to pay them. That is why those fees gets passed on to the buyer. However, in this case, the escrow company is collecting the money and passing it on to their headquarters. So technically, they don't keep it and can therefore collect it.
Taking that a step farther, couldn't they do that with their franchise fees? Postage stamps? Employee wages? They don't get to keep those either!
I can not stand junk fees! If it is a cost of doing business, just up the one fee and get it over with. Tell me what it's going to cost. If you do a good job, I won't have a problem paying your fee, but don't nickel and dime me, or my clients, to death!
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