Hi, Mariposfuji. From "Surviving the Real Estate "Escrow" Process in California"
"The choice of escrow is normally agreed upon by the principals to a real estate
transaction and reflected in writing in the purchase contract. A seller may elect to
choose "ABC Company" and the buyer may choose "DEF Company," but both parties
must ultimately agree, like they must on all terms and conditions of a sale. If a real
estate broker is involved, it may be a common practice for the broker to recommend an
escrow company, especially if the broker continually does business with a particular
escrow officer or company. However, while a real estate broker may suggest an escrow holder, he or she may not designate an escrow holder as a condition precedent to a transaction.
It is also important to note that there are laws which prohibit the payment of referral
fees, rebates, and/or kickbacks between escrow, title, and real estate companies, for
the referral of business. Except for normal compensation between an escrow company
and its employees, Section 17420 of the Financial Code provides that for those under
the jurisdiction of the Escrow Law, it shall be unlawful for any person who pays over to
any other person any commission, fee, or other consideration for referring, soliciting,
handling, or servicing escrow customers or accounts. Basically, escrow holders are
prohibited by law from the giving of any consideration to a party as an inducement for
receiving an escrow. There are comparable laws that prohibit referrals fees and rebates
that govern real estate brokers and title insurance companies as well.
Please remember that when it comes down to the selection of the escrow holder, you as
the consumer always have the right to choose an escrow that is professional,
competent, reasonably priced, and which will fulfill your transactional needs."
The Realtor your mortgage broker recommended may be a good agent, but I would not recommend choosing any agent solely based on which escrow company that agent prefers to work with.
In the current market, the seller often reserves the choice of escrow providers, so you as the buyer may not have much leverage getting your agent's preferred escrow provider, although it would still be negotiable between the buyer and the seller.
Interview a few local Realtors and choose the best one suited to ALL your needs, not just escrow.
We serve Arcadia and the San Gabriel Valley. www.sgvre.net
Hope this is helpful!