Posted by davidK/CA on 8/30/06 11:11am
Msg #142127

My take on the proposed California regulations

I think the effect on Signing Agents is way overblown.

If California forces title companies to lower the fees they charge consumers there will logically be some shrinkage in employment but I believe that the majority of title companies have found that doing the "signing" process in-house is not cost effective for the title company.

I believe that the title companies can make more money per employee payroll dollar by doing what they do best, issue title policies and charge for processing the paperwork before and after the "signing", not spending an hour or more pushing paper in front of the borrower and saying "sign here."

Raising or lowering title company fees will not change the current reality that most husbands and wives have to work to support the family, and they can't or won't take time off from work to go to some fancy title company office during regular working hours, Monday to Friday, to sign papers. The borrowers enjoy coming home from work, having dinner, playing with the kids, and then having a Notary bring the paperwork to their very own kitchen table. The TV stays on, the dogs are still roaming around doing whatever they do and the papers get signed for a reasonable price.

And to sum it all up, in California we have enough wacky judges to keep these regulations tied up for so many years that it's very likely that it will never come into force.

All bark, no bite.

Reply by Joan Malone on 8/30/06 11:31am
Msg #142132

Actually, all very good points David. I get a kick out of your comments on wacky judges in California.
Also, if Title companies get so busy doing signing's again in office. I'll sit in their office and do signings for them at $75.00 a loan. No printing, no driving, same rules and conditions. Sounds good to me. I'd even cut my cost on that one.

Reply by g/ca on 8/30/06 11:44am
Msg #142137

If this did go into effect, I was thinking that the Title Companies might first cut out the middleman the Signing Services. They are paying them for something they can do themselves, calling the notary directly. I would hope this would be the case anyway.

Reply by JanetK_CA on 8/30/06 7:27pm
Msg #142359

Right. And at more than $75 a pop, too!

Reply by NCNotary on 8/30/06 11:39am
Msg #142134

Has anyone thought that there maybe a positive side to this? If fees are to be reduced, where is the biggest cut going to be? Since many notaries in CA work at minimum fees for signing companies, maybe the cut will be at the signing company level. The fallout has to be where the fat is, and that is signing companies. Title and Escrow will still need notaries, but maybe they won't be so lazy as to assign everything to a signing company, and will develop their own stable of professional notaries and eliminate the middle man. We can once again be paid as professionals and not the bottom of the barrel.

Make lemonade!

Reply by davidK/CA on 8/30/06 12:21pm
Msg #142162

I agree, this could be beneficial to the NSA

Think about it, no more signing services taking half or more of the Notary fee which is PAID BY THE BORROWERS, not the title companies. Total fees could be reduced, yet the notary gets a raise in income. Now that would be a real benefit to the consumers of California and elsewhere.

IMHO, the only thing preventing title companies from dumping the signing services is because "that's the way we always have done it." If the title companies have a stable of qualified, professional notarys in their Rollodex or Outlook contact list it's almost as easy to call a notary or two as it is to call a signing service and then have the SS call the title company back after they get a notary to accept an assignment. Call the notary direct, all the questions and issues get resolved immediately, and you (the title company) are done!

Nirvana!

Reply by NCLisa on 8/30/06 12:28pm
Msg #142167

As a former EO, I used to just put on the Settlement Statment $175.00 to AAA Mobile Notary. The fees never came out of TC reserves. And I cut the check out of escrow directly to the SS. The DOI is not regulating the notary & signing fees, only the escrow and title insurance fees. Again it doesn't take any more work to close a $300,000 home than it does to close a $1,300,000 home. The sliding scales can go. I hate to say this, maybe they will lower some of the EO's salaries. I know of several in Contra Costa County that make more than $125,000 a year.

Reply by Poppy on 8/30/06 12:55pm
Msg #142176

Do you think the Realtor's commission should be cut for higher priced homes? What about the lenders commission.
Perhaps they should come up with a flat fee that Realtors and Lenders should charge for selling a home and obtaining the best financing for a client. Maybe we should do away with the fee for a buyers agent all together (we really don't need them anyway) Just bundle it all together in one flat (fixed fee)

Perhaps we wouldn't mind having a minimum and maximum wage throughout the US. Lets face it, if we all made less money everything would cost less for the consumer. Right?
I think the government would do an excellent job at coming up with maximun salaries and wages, maximum fees for services etc. (Don't you, after all they're elected officials) Why should people be able to charge what ever they want for services and what about the prices for our everyday goods shouldn't we have maximums for those as well. Why should others get rich off of us?
After all if the CEO's, CFO's, EO's and all the rest of those yahoos made less money we would all pay less in the end right?
If the teenager working at In and Out Burger started at minimum wage instead of $9.00 per hour we would all be paying less for our burgers and lets face he's a teenager he doesn't need to start at $9.00 per hour. Right?

I know I'm being extreme but I'm trying to make a point. This may seem like no big deal and maybe it isn't, but when you allow price fixing in where will it end.

Reply by NCLisa on 8/30/06 1:27pm
Msg #142193

Insurance is supposed to be regulated. Without regulation would you like to guess at what your auto and homeowners insurance would most likely be? A heck of a lot more than you are paying now.

I spent over 10 years in the employ of TC's. We had lots of liquor in every office I worked at, in all the companies that I worked at. We had huge expense accounts to take people out for lunch, dinner, etc. We threw huge parties in very expensive places with huge open bars. We hired software engineers to design programs simialr to ACT! for realtors to get more business. We hired transaction coordinators in our offices to do the realtors paperwork for them. So we paid several people $35,000 a year, to do the realtors paperwork for them?! They supply the realtors with labels for mailouts to their farm areas. They do property profiles for free for the realtors so the realtor can come up with a listing price, instead of the realtor doing the groundwork themselves. Do you see where TC's can cut and not hurt their core business and core employees. The transaction coordinators can start their own businesses because if the realtor doesn't know how to do their paperwork, then they will need a transC. If TC's didn't have deep pockets they couldn't afford all this, and all this is not what is necessary to get business. Doing a good job is. Geez, just about every branch office of a TC in CA even has their very own marketing rep. Marketing is a great thing, but all the other perks are just a little over the top, and it is always one TC having to out do the next for that market share.

Do I think realtors commissons should be cut, that depends on the realtor and the amount of work they actually do. Do I think lenders fees should be cut, yes, when there charges are in excess, and we've all seen that on the hud.

Reply by Poppy on 8/30/06 1:37pm
Msg #142200

Lisa... I appreciate that you have taken the time to

thoughtfully form an opinion regarding the situation. I respect it and thanks for your input...
Have a great day! Poppy

Reply by patricia on 8/30/06 3:25pm
Msg #142264

I have also noticed that some of the title company offices here in Ca. look like the Taj Majal.
These places are making plenty of money. I dont disagree with that but when they are gouging the consumer they need to be controlled.

Reply by Gary_CA on 8/30/06 12:16pm
Msg #142157

The devil's in the details.

I don't have it in front of me at the moment but One of the emails I got said that Garamendi wanted to reduce closing costs ITEM BY ITEM.

Now that is a little scarey... he may think he can reduce notary fees DIRECTLY. If he tries to cut 27% there that is indeed a problem.

Last I checked we aren't regulated by the DOI... but I wouldn't put anything past this idiot.

I sent off one letter, then I'll wait and see.

Reply by Poppy on 8/30/06 12:32pm
Msg #142169

Here are links to the actual regulations if anyone is

interested.

http://www20.insurance.ca.gov/epubacc/REG/85369.htm

http://www20.insurance.ca.gov/epubacc/REG/71309.htm

http://www20.insurance.ca.gov/epubacc/REG/85409.htm

http://www20.insurance.ca.gov/epubacc/Graphics/85370.PDF this is the link to the acutal text of the regulation...

Set aside what it may or may not do for NSA's. Doesn't it bug you that this regulation amounts to price fixing (JMO I guess) and it's really just politcal BS in the first place.

Reply by davidK/CA on 8/30/06 2:17pm
Msg #142213

Price fixing is in the eye of the beholder.

IMHO, the price fixing is certainly not on the part of the NSA. It's between title and escrow companies who are chosen by the lender, not the borrower. The lack of competition between title and escrow companies over their fees breeds corruption, and while I believe that much of this proposed regulation by the Insurance Commissioner is just politics, the reality is that the costs to the borrower for title insurance and the other numerous and duplicative fees that are always surprises at the closing have been significantly increasing in recent years.

All the proposals for a "one-fee" charge to the borrower have died because of the money spread around by the title and escrow companies. Does anyone really believe that when the loan is for say a million dollars that it is really necessary to add a $17 dollar separately stated fee for a credit report? Is it really necessary to have both a "document draw fee" and a "document review fee"? How about an "administrative fee" and an "underwriting fee" for the same loan? Isn't underwriting an administrative function? Why not add a fee for "title search" and another fee for "computer research" and another fee for "lunchroom maintenance"?

Looking at a recent signing for a second loan there were TWENTY THREE separately stated fees and costs on the estimated closing statement, not including the title policy itself or the principal and interest on the refinanced loan. Except for the "points" on the new loan, none of these fees and costs were disclosed in advance to the borrower, or were the result of negotiations between borrower and the title company. Alomost one-half of the total loan costs were these non-negotiable and undisclosed junk fees. Does this stink or what?

I applaud the Insurance Commissioner, regardless of his motives, for at least attempting to bring some minor consumerism efforts to an industry that charges the borrowers whatever they want to charge without the possibilty of negotiation between borrower and the title company.

I think the NNA is just trying to scare their members to get more renewal membership fees, hoping that notarys will think the NNA is supporting the interests of the notary instead of themselves.

Reply by MelissaCT on 8/30/06 4:48pm
Msg #142304

All I can say is...

look how well deregulation (electric) is going across the country. When government steps in, nothing good comes (usually). I know my electric rates have shot up & competition isn't anywhere to be found.

Reply by JanetK_CA on 8/30/06 7:59pm
Msg #142364

Re: Here are links to the actual regulations if anyone is

Thanks for posting these links again, Poppy. After trying to read the details of the proposals - and I'm not pretending to understand the formulae - I am a bit less concerned than I was from just reading the NNA's statement. I'm not sorry I sent my letter, but I agree with most of David's statements below. There certainly is abuse in the industry and it would be good to see something done about it.

I'm not convinced that price fixing is the answer, however, if I understood correctly, most of the new regulations are directed at companies with over $2 million in revenues. Also, I think that fees could be different for different companies, based on their reasonable expenses. I guess time will tell...

BTW, I found it interesting that the NNA asked for everyone to send them copies of the letters they sent. (I didn't.)