This is one of those very touchy subjects. As an ABR, I know it's my duty to represent my buyer fully and with diligence. There is NO CUSTOM in California, or otherwise that I am aware of, that the seller chooses the service providers. It is part of the negotiation process, and the choice of escrow is no small matter. Old school agents will say, "It's always been that I pick the escrow and you can have the title," as if the agents are in some way party to the transaction. As a good agent, you must explain the import of the decision to your client (buyer or seller) and let them decide. The state of California was so concerned about escrow companies being forced on buyers during REO transactions that legislation was enacted to protect them from a lack of choice. How are REO's getting around it? By saying that the buyer can choose the company if they pay both sides. Some choice!
Please inform your clients about the importance of a licensed, insured NEUTRAL escrow to the overall success of the transaction. (I give a list of 5-10 good local companies, and let them shop and interview.) Then let them decide.
The Bremner Group at Coldwell Banker
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As a practical matter, the principals to the transaction rarely care. They leave it to the agents. But for those who care, the Seller generally cares about the Title company, because they are insuring the Warranty Deed. The choice of escrow company is more likely to interest the buyer, because they're the ones bringing the money.
All the best,
REO companies insist on picking escrow because they get a lowball deal on it. It's about quanity not quality. Most REO escrow transaction over look the customary services that your typical company will provide so don't assume they will do anything.
As for wanting escrow when I have the seller it's about having a relationship with an escrow officer that knows what they are doing and handles the transaction with care and attention to detail.
NOT ALL ESCROWS ARE THE SAME.......... Find an escrow officer that works hard & knows what they are doing at a DOC approved escrow company and fight for them in negotiations. It will make your life & your client's easier.
As a Buyer's agent, I have found out many times that escrow companies and title companies are very competitive, legal, and regulated. Therefore, I don't force much negotiations for these items.
I have never come up with a strong reasoning for this but only fight it occasionally when there is a bona fied reason.
David R. Indermill
Re/Max Hall Of Fame, CDPE | Since 1998 | Luxury Real Estate Advisor
International Referrals | Bank Owned Assets | Off Market Properties
Large Cash Investor Fast Close Network | B.R.E License # 01232827
Cell: 858-414-LIST (5478) Texting OK
The Real Estate Services Procedures Act, a set of federal laws, currently dictates many practices within the real estate industry. Among the many RESPA laws, the act gives buyers the right to select which title insurance company to use in their real estate transaction. Often, consumers rely on their real estate or escrow agent to choose the insurer; however, it is the buyer’s right to decide which insurer to use. When purchasing a loan policy, you will also need to meet your lender’s requirement when selecting a title insurance underwriter. Your real estate or escrow agent will provide you with a disclosure detailing your rights.
this is a great question, and I'm looking forward to reading a lot of experienced answers and opinions. I';ve recently just relocated to Los Angeles. I had been practising real estate sales for years in Cleveland, Ohio, my hometown.
In Ohio, it was customary to let the buyer choose the title agent. only for REO properties, the banks were adamant on using their own choice. they made this exception easier to swallow by paying much of the buyer's closing costs.
All the best,
Kieran Jackson, CA DRE # 01903647
Keller Williams Hollywood Hills
Short Sale Specialist (SFR)
First, a quick TU for my fellow ABRÂ® Deborah!
I fully agree the Buyer should be proactive in seeking the most competent and professional Escrow and Title Company service providers possible (and as Laura mentions, DOC-approved) --especially when dealing with REO properties.
As demonstrated in the "real world story" contained in the blog post below, having the Buyer choose, and if necessary, paying for Escrow/Title services may be considered conservative but may also be warranted to exercise proper due diligence.
"REOs: How Buyers Can Avoid Hidden Unsecured Property Tax Liens"
While each County in CA has their customary escrow and title fee splits [ http://docs.Steven-Anthony.com/ClosingCostsGuide.pdf ] this in no way obligates any Buyer/Seller â€“ every dollar to be spent is negotiable based on the situation at hand.
Richard "RJ" Kas (SFR, SRES)
"Representing the finest properties from Los Angeles worldwide"
KAS Properties - Coldwell Banker Previews International - Beverly Hills South
166 N. Canon Dr, Beverly Hills, CA 90210
310.859-5334 office - 310.488.9826 mobile - 310-273-0690 fax ATT: RJ
RichardKas@gmail.com - http://www.RJforLA.com - DRE: 01352771
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