Background:<\/span><\/p>\nTitle Insurance is one of the least understood, yet one of the most expensive closing costs consumers will encounter in a purchase and sale of a home. Recently, title insurance companies have been under significant pressure to clean up their act. Many state investigations (insurance commissions or Attorney Generals), including here in Washington State, have looked into and filed cases against title insurance companies for alleged kickback schemes involving real estate brokers, lenders and builders. Many high profile cases have led to significant settlements with title insurance firms.<\/p>\n
I hope to post the issue simultaneously on both blogs so that, if people are interested, you can get quite a glimpse into how both consumers and Realtors address the issue.<\/p>\n
Many facts I’ll present are eye opening, controversial and alarming. Title insurance is huge business. Huge. Realtors, lenders and builders steer clients to affiliated business relationships (ABR’s) they have, including title companies. It raises questions that I’ll try to answer:<\/p>\n
\n- Are affiliated business relationships created with consumers best interests in mind or is it used to steer\/control another profit center in the revenue generated by the transaction?<\/li>\n
- Why do title insurance companies never advertise to the public<\/span>?<\/li>\n
- Why is title insurance so expensive?<\/li>\n
- Why do only four or five title insurance companies have a stranglehold of 92% of the entire US market?<\/li>\n
- Why does the maverick State of Iowa ban title insurance companies?<\/span> And how can they self insure at half the cost of title insurance firms in other states?<\/li>\n
- If you own a home, did you shop for insurance or were you steered by the agent, builder, lender or escrow firm you worked with?<\/li>\n<\/ul>\n
In the quest of my “Consumer Driven” mantra, stay tuned.<\/p>\n