Closing Cost Rip-Off - Part 4

My son recently sold his home. The custom in this area is that the seller pays for an Owner's Title Insurance Policy. This assures the buyer that he has good title to his new home. In our state title insurance rates are regulated by the Department of Insurance. That Department doesn't tell the companies what to charge, but once they have registered the rates with the Department, they are not supposed to deviate from that price list.

So who is supposed to look out for this in a transaction? Certainly not the poor guy who is paying for it! He doesn't know the policy and he doesn't have access to the rate sheet anyway. He assumes someone else is looking out for him, and he should. But who is?

Theoretically, the title company itself should charge only what is legal. For example, if the borrower qualifies for a "Short-term" rate because of having purchased a previous policy within the last 5 years, he should be charged only the Short-term rate.

Next, the closing agent, escrow officer or attorney, whomever, should also know this and make sure it's proper. I think one of their jobs is to take responsibility for insuring accuracy. Finally, the real estate agent certainly should know this. He should review a copy of the estimated closing statement. The charges on that statement should be compared with the rate sheet to assure nothing is improper.

In the case of my son's transaction, none of those people did his job. But when I reviewed the statement and saw he was over-charged. Result? A $613 refund!

Put this on your list of things to check!

Comments

[LSD]

Good job!