Posted by Glena/NV on 1/31/05 11:42am
Msg #18857

Title companies, overcharging notary fees and keeping it.

I work directly for a title company where they charge the borrowers $200. They pay me $75 and they keep the rest. They sometimes even ask for a lower fee. There is no middleman in between (no signing service), so they do keep the rest of the money. I know that this is illegal per RESPA, since they cannot profit from the notaries...just wondering what you guys would have done.

Reply by Roger/OH on 1/31/05 11:55am
Msg #18859

First thing I would have done is not accept $75 from a title company. Why would you do that to yourself? You're in charge of your own fees; it's not what they offer, it's what YOU decide is acceptable for you.

Reply by Glena/NV on 2/1/05 2:27am
Msg #18972

This is the only title company that I work with the will never pay beyond $75 on overnight. They do pay the usual fee for eDocs but they are like SS. Will never go higher on overnight fee. Yeap! I've tried that. It does not work.

Reply by Anonymous on 1/31/05 12:08pm
Msg #18860

As I am aware a title company still has services that they are inquiring fees to perform so I'm not understanding where they are profiting from a notary or why you state it that way in your question. I agree with Roger/OH that I don't understand why it is that you would accept that fee anyway.
In MY experience it's the signing agencies that profit and do no benefit what-so-ever to help a notary, since they are taking 50% most of the time, if not more and from what I see they REVIEW docs only. And having said that, they also takes the longest to pay when we all know that they get paid when the title companies disperse funds on the funding date, just don't know why they think it should give them 4-8 weeks to pay notaries when they have the money in 10 days or less.

Reply by Tina on 1/31/05 10:06pm
Msg #18954

I heard that the more Loans that a Title company gives a Signing Service, That it takes a little longer than just 10 days to get paid. But I agree with you, some signing services take way too long to pay Notaries.

Reply by Glena/NV on 2/1/05 2:40am
Msg #18973

Anonymous state,"As I am aware a title company still has services that they are inquiring fees to perform so I'm not understanding where they are profiting from a notary or why you state it that way in your question. "

I think that you should word your statement better because I really do not understand what you are trying to say.

If you are saying that the title companies have other services that cost them some money to perform, then they should not list it as a notary Signing Fee on the HUD. They should show it the way it should be shown and not hide it behind the notary fee. Also, if they are profiting $125 ($200-$75 that they pay me) from the fee that they have collected for the borrowers and they are all fees envolve in the notary signing only, they would be in violation of RESPA section 2607 (collecting unearned fees). This are services that the notary performed, not the title company and as such, they are in violation for collecting it.

Reply by InkWerk/CA on 1/31/05 12:46pm
Msg #18864

I'm curious. How did you find out they are keeping the change? Did you find out the estimated fee as indicated on GFE and such, or the actual fee charge to the borrower as indicated on the final closing statement?

Reply by Glena/NV on 2/1/05 2:42am
Msg #18974

The actual fee stated on the final closing statement....

otherwise, I would not be posting it here. Even the borrowers were griping about how high my fee is...of course I could not make a comment about it.

Reply by InkWerk/CA on 2/1/05 5:04pm
Msg #19063

Re: The actual fee stated on the final closing statement....

Interesting that they would have a final closing statement before escrow even closed and the documents were signed. I take it they must be friends of yours and showed you the final figures after the close of escrow.

Reply by CaliNotary on 1/31/05 1:04pm
Msg #18868

Why don't you just ask them the next time they call you? Explain the RESPA regulation and ask why they're not paying you the full $200. It sounds pretty shady and I share the opinion of the others in this thread that $75 is way too low of a fee to accept from a title company, especially when you know that the borrowers are paying almost 3 times that amount.

Reply by Anonymous on 1/31/05 1:18pm
Msg #18872

Title/escrow companies are instructed from the lender( lenders instruction) on what to put on the settlement statement or est( for the signing est). The lenders pad a little bit just in case. (when the docs are drawn the lender may not know what the notary is going to charge). On the final hud 1(which is given at the closing) it may very well read notary fee$75.00 and the borrower receives whatever overage there may be. Most title/escrow co have to keep the notary and all invoices in their closed files.

Reply by CaliNotary on 1/31/05 1:30pm
Msg #18875

That may be true, but I seriously doubt that's the case here. This title company does not ask her what her fee is, they offer $75 and sometimes try to negotiate an even lower fee. I would bet the rent that the other $125 is not going back to the borrower when the loan funds.

Reply by Glena/NV on 2/1/05 2:52am
Msg #18977

Thank you for clarifying that, CaliNotary! That is exactly

what I meant. The borrowers would not have made any comment as well if they are getting it back.

Reply by Glena/NV on 2/1/05 2:50am
Msg #18976

Anonymous....

The final HUD had the $200 on it as a notary signing fee, otherwise I would not have posted it here.

Reply by Glena/NV on 2/1/05 2:46am
Msg #18975

Good point, CaliNotary!

It just never hit me before, because I never paid attention to how much they are getting except that last Saturday, they asked me to take less because she said that the borrower is not so stingy and they gave them a hard time on every fees, but when I got the final HUD, it was listed at $200. Now three more orders came and all of them hacve $200 for notary signing fee.

Reply by Paul-CA on 1/31/05 3:25pm
Msg #18892

Glena's post, taken at face value, deals with a legal issue. At the same time, it touches upon issues of fairness and ethical behavior and it gets really close to the heart of the "fees for SA's just aren't what they used to be" matter.

Let me play devil's advocate here for a moment: Suppose this job didn't come directly from the title company but from a reputable SS. And suppose the docs are delivered to the SA (as opposed to e-Docs or emailed docs) and that the location where the borrower and notary meet is near the SA's home or office. There's plenty of anecdotal evidence on this forum to suggest that accepting such a job from an SS for $75 is perhaps a little low but still within the range of commonly accepted fees.

The question then (aside from the legal issue Glena raises) is, what right does an SA who would take the assignment from an SS for $75 have to expect more than that simply because the job came directly from the title company? It's pretty much the same amount of work for the SA, and the SA should know how to set his or her fees according to the amount of work and time it requires. If the logic is that the title company would have paid an SS $200 so they should pay the SA $200, then I think who's getting overlooked here is the borrower.

When a title company pays an SS $200 they're essentially doing this to avoid more than $200 in potential expenses should they have to staff for and manage the entire notarization process themselves -- all the expenses of having to find a qualified SA, get everything scheduled, handling last minute changes (possibly find a replacement SA at the last minute), ... None of this has anything to do with the actual work the SA does.

What Glena's post implies is that she works regularly for this title company, so it's very likely that little of the above "management" expenses apply in this particular instance. This becomes the legal issue. If they are charging the borrower more than their averaged expense for having secured the notary services plus the notary's fees, then they've pocketed some unearned money at the borrower's expense. If, however, they typically handle getting an SA themselves, then they can easily justify their $125 cut as covering an averaged expense because they've incurred the associated costs (not the least of which is having [the equivalent of] an employee on staff to take care of this).

Glena didn't say it, but the thought that an SA should be able to get the SS fees for a loan signing when working directly for a title company is floating around on this forum. Once it becomes a standard for an individual SA that $75 is an acceptable amount for a loan signing (and I'm sure the signing services would love to see $50 as the norm), then the SA has pretty much given up the right to complain when they ARE paid $75, regardless of who got them the job.

Glena is still faced with an ethical dilemma. If the title company has illegally charged the borrower, do you report them and risk losing their business? Or just figure it's the borrower's fault for not questioning the fee? Or that the title company's at fault for not sharing a bigger slice of the pie with the agent?

Reply by Glena/NV on 2/1/05 3:12am
Msg #18978

You read my mind, Paul-CA...I have to add,

I do believe that if they do not hire a SS to find us, they should pay us the full fee. I do not believe that their role have not changed the moment they call me for a signing. The only difference is that, instead of calling the SS, they call me. The same time and effort spent to call the SS is the same thing spent to call me, since they do not use anyone else and they don't shop around to find someone else but me.

Now that you know that this title company will only pay a maximum of $75 for the overnight docs, they are not flexible about the fee(take it or leave it kind of thing), would you rather accept the $75 or go ahead and accept it knowing that if you don't someone else will. Also, what would you do about the fact that they are overcharging the borrowers and they are in violation of RESPA Section 2607? I don't think I would go there, but I am just curious what you guys have to say.

I think that I will follow what CaliNotary says. I will bring up the RESPA statute and go from there.

Reply by Nd_WA on 2/1/05 5:17am
Msg #18983

Glena,

I can only say that they called you exclusively because you have a good track record with them. But, your unavailability would deem justifiable to them having to look for someone else. The same goes as if they have tried calling someone before you.

Just blame it on the low ballers and those who accepted them. They are the ones who violates the industries standard. I don't see any wrong doing with the title company eliminating the middle man.

Reply by Nd_WA on 2/1/05 3:59am
Msg #18979

Stingy borrower

I had a signing recently where the borrower barked at every single line item on the HUD. THe HUD showed notary fee to SS for $200 and SS agreed to pay me $150 for the job. The signing took place at the borrower's work/office. When he barked at the total title & misc charges to the escrow officer, I clearly heard the EO told him over the speaker phone that title ins. charge will be adjusted, notary fee will be dropped, etc.

It was an interesting 3 hours signing and the smarty stingy borrower won in the end. He shaved off almost $3k from the cost of his loan between the lender & title company. I wondered if title & the SS ever profited from his loan.

For the ethical dilemma in this thread, my fee is quoted at title level and negotiate from there. Compare to the real estate commission split structure, though not exactly the same, but I'm satisfied with the range of 60-70% of what's stated on the HUD for notary fee to anyone else. Who charges what on the HUD is not my business as long as mine is met.