You may find it convenient to have someone come to your home with notary stamp in hand and a pile of papers for you to sign.  What you might not realize is:

1. You may be charged a significant settlement fee – sometimes costing you several hundred dollars.  While the fee is allowable in Pennsylvania under certain circumstances, the borrower must be informed of the cost in advance.
2. The “closer” may only be authorized to witness your signatures and not be able to describe or explain any of the documents.
3. The notary might not have sufficient liability insurance coverage – leaving you out in the cold if they make a mistake.
4. This person might not have any knowledge or experience in real estate closings – possibly causing errors or not noticing errors that may cause your appointment to be rescheduled.

While a number of individuals may identify themselves as “notary signing agents” or “certified signing agents” don’t be fooled – these are self-awarded titles and are not certified or recognized by any regulatory body.

Avoid the additional cost and increased risks of an at home closing by choosing a settlement service provider with local offices who offers closings using licensed title insurance agents.

In Why Shop for Title Insurance, we explained how consumers can protect themselves from inappropriate charges simply by comparing charges from various providers.  Now we’d like to provide you information on how to shop for title insurance.

First, check the rates and fees

We’ve developed a Title Insurance Shopping Guide for use in Pennsylvania. This will allow you to compare quotes side-by-side. A detailed comparison will quickly highlight any glaring discrepancies such as incorrect application of the rates or inappropriate or “junk” fees.

Once you have compared the quotes from several title insurance providers, your next step is to identify the best title insurance agent for your transaction.

Interviewing a Title Agent

What’s important when selecting a title insurance provider? After performing literally thousands of settlements, we think we know what works. Here’s a quick list of important areas to consider to ensure a smooth settlement without surprises or post-closing issues.

Independence - An independent agent doesn’t risk being mired in conflicts of interest. We agree with The Office of the Attorney General of the Commonwealth of Pennsylvania on Affiliated Business Arrangements (where a lender, real estate agent or builder owns part of a title agency):

“ABAs…also create an inherent conflict of interest…”

Experience – Real estate transactions, even “simple” refinances, require the attention of an experienced title agent. Experience can make the difference between a smooth transaction or one mired in problems and omissions.

Local Knowledge – “All real estate is local” is a tried and true maxim. Real estate laws, rules, regulations and customs, are exceptionally local. Just because someone can pass a test sponsored by the state, doesn’t mean they have the knowledge of your local area. Many post-settlement headaches and mischarged fees are caused by out of area settlement agents trying to work outside their “boundaries” Make sure your title insurance provider has a local presence.

Focus on Quality – The true test of a title agent is satisfied clients. Do they have testimonials available? Do they use employees or contractors, like signing agents to conduct key parts of the transaction? If possible, try to talk to the person who will be handling your transaction. Be concerned if the title insurance provider can’t or won’t identify who’s handling your personal information.

Ask more questions – We’ve created a helpful guide Questions for Your Title Insurance Agent so that you can better equip yourself to shop for title insurance.

If you haven’t heard it by now, mortgage rates are at their lowest in years.  No doubt you want the best rate and terms from your mortgage lender.

Just as important is the reputation and proven performance of your settlement services provider.  Not only will your title insurance agent insure the mortgage lien position of your new loan, the title agent will also conduct your real estate closing.   A good agent will communicate with you and your lender and make sure your mortgage documents arrive on time for your signature, take care of all the little details that do crop up, and most importantly, make sure the loan funds when it should!

The Pennsylvania title insurance premium is a filed rate – meaning every provider licensed in PA who follows the rates set by the Title Insurance Rating Bureau of Pennsylvania must charge the same rate.  It is important for you to question your provider up front regarding the rate you qualify for.  There are three levels of discounts available to qualified homeowners.  Don’t miss out on significant savings.  For a complete explanation of the available discounts, see an title insurance rates explained.

To help manage your requests for quotes, visit North American Land Transfer for a free title insurance price shopping worksheet.

Most title insurance transactions are entitled to a significant discount on the title insurance premium. Title insurance rates are filed with the Pennsylvania Insurance Commission and provide for tiered discounts based on the amount of time since the last issuance of a title insurance policy. Some examples:

• A homeowner refinancing a Mortgage originally recorded 3-4 years ago is entitled to nearly a 30% discount.
• If the same homeowner signed a Mortgage recorded within the last two years, then he or she is entitled to nearly to a 40% discount.
• Haven’t signed a Mortgage in recent years? Don’t worry. If you signed a Mortgage within the last ten years, you are entitled to a premium discount of 10% off of the basic rate.
• Don’t have a Mortgage – no problem, your discount will be based upon the recording date of your insured Deed.
• Buying a property? There are various discounts available to purchasers from 10% to almost 20% off the basic rate depending upon your transaction and property.

There are restrictions, albeit very limited, so give us a call or use the contact form above if you have any questions.