Posted by FeliseSoCal on 8/3/09 6:56pm
Msg #298548

Collecting fees from borrowers

Has anyone ever pursued collections on a borrower who rescinded? I did a signing for a local title company who is one of my best clients (not a signing service) that took over 2 1/2 hours plus another two hours of driving. He complained the entire time about the terms of the loan and spent about 45 minutes on the phone with his lender, yet he signed all the paperwork. A few days later he rescinded. The title company gave me his contact information to send my invoice since it did not close escrow. I sent him a letter and the invoice stating he was responsible for the charges since he requested a traveling notary and signed the paperwork. He was also informed in advance of the notary fees to have a notary come to him. He did not respond to the letter. Has anyone had a situation like this where they sent a collections letter and had any luck? If so how was letter formatted? Thanks in advance. Any advice on how to collect would be much appreciated.

Reply by ME/NJ on 8/3/09 7:22pm
Msg #298552

Do you have a commitment letter from BO

If you have nothing in writting saying they owe you a fee. Your SOL.

Reply by Philip Johnson on 8/3/09 7:34pm
Msg #298553

He hired you?

I don't think he did, the TC hired you, your beef is with the TC not with this guy. How can you collect from someone you didn't strike a deal with? Time to move on.

Reply by MW/VA on 8/3/09 9:10pm
Msg #298573

The borrower did not contract with you & is not responsible for your fee. IMO it's bad business to go after the borrower to try to collect your fee, ever. I have done some RM's where there was a notice in the package that specifically said that if the loan didn't go through, the borrowers were responsible for the fee. Other than having something in writing, you have no grounds for collection. Borrowers are usually advised in advance what their losses will be if they don't go through with the transaction--sometimes application fee, credit report fee, & appraisal. It is entirely up to the policy of the tc whether they will pay notary fees for a loan that doesn't fund. A few do, but most don't. It's part of the business, unfortunately. It sounds like that loan was trouble from the get-go.

Reply by FeliseSoCal on 8/3/09 9:16pm
Msg #298574

Thanks for your input everyone. I guess it's a loss this time.

Reply by MW/VA on 8/3/09 9:28pm
Msg #298579

IMO, rather one lost fee than the greater loss of business because you crossed the line & went after the borrower for your fee.