|Post by Les CO re the current state and probable future of our industry.|
A long response to those that replied to my "shooting" post
Posted by Les_CO of CO on 1/11/10 10:52pm Msg #317686
Just in case you haven’t noticed….This business is changing! In the old days any Title Company wanting to do business nationwide, or just out of their area, had to find another Title Company, that would do a “Courtesy Closing,” for them, or find a ‘Mobile Notary Signing Agent’ to do the job.
They did this through a Signing Service, or through their own efforts.
The Title Companies arranging these signings themselves found it involved time, some personnel, equipment, and TRUST. Just acquiring and maintaining a “Notary Data Base” was/is a daunting task. Then there was the scheduling, notification’s to the Notary/borrower, problem solving, follow-up, and doing all the things necessary to close. This all takes time and personnel. No one works for free. (Except maybe some NSA’s). These ‘signings’ were managed by the large-to-medium sized Title Companies “in house.” They had the personnel, equipment and/or the income/cash flow to accomplish the task and pay the costs. They STILL got their “closing fee/escrow fee” (say $350 to $500, plus costs) along with their other fees for title insurance, endorsements, etc. They simply added to the closing costs, (usually on the HUD) a ‘remote closing” or “notary fee” of whatever the NSA charged, which the borrower paid. The smaller Title Companies that did say 1-to-4 out-of-area closings a day couldn’t afford the personnel to do these ‘remote closings’ in house, so they mostly used a Signing Service.
I believe that it was First American that started to change this scenario.
Someone at First American realized that some of these SS’s were making a pretty good profit on what they do, so perhaps they (First American) should start their own in-house SS, and look to it as a profit center? They did! Hence… FASS! First American took the Notaries off the HUD and paid FASS, and FASS paid the Notaries the absolute minimum they could, keeping the difference as profit. Then other low-ball companies like Nations Direct sprung up, with the NNA churning out thousands of new, supposed NSA’s on a weekly basis there was plenty of fodder to choose from. Nations Direct pays $40 to $50 per signing. Unless it’s an emergency at the EOM, or the signing is very rural, the: “They met my fee.” means you work cheap! Or you’re being disingenuous. Nations Direct will NOT pay MORE than they charge, and they will not schedule a job at a loss. They simply turn it back to the Title Company. (In the “service” business, you get what you pay for!) This makes the ‘escrow officers’ at Title scream, but the escrow officers (closers) still aren’t…the Boss! (Or the accountant!)
Seeing that this low-ball tactic works, some of the struggling Title Companies, say “Why don’t WE too use these ‘remote signings’ as a “profit center?” Let’s take the Notaries off the HUD, bundle their fees into our bundled services, closing fees, pay them less keeping the difference? It WORKS! No more pay the Notary $150-$200, recognized on the HUD. Now it’s pay them $100 (or less) and keep the difference.
The little guys still can’t afford to pay the overhead to have an in-house ‘remote closing dept.’ so many still use a SS. But if you haven’t noticed lately very few SS’s are listed ‘On the HUD.’ Because they (Title) like to pay out of their ‘operating’ account, and monthly. Less paperwork, and Title still can make a little extra something from each ‘remote signing.’ This is why these undercapitalized SS’s are now trying to pay after they get paid, 60 to 120 days out, using YOUR money as working capital.
I once thought/said that “As long as there were Title Companies that do not have a ‘brick and mortar’ presents in a State they do business in, they will need us.” Us being… PROFESSIONAL Notary’s… specializing in doing ‘remote closings,’ just as they are done in a Title Companies office, but at the borrowers convenience.
I’ve changed my mind. I now think when interest rates tick up a bit, and things slow even more, there will be MORE cutting of fees paid to Notaries, and MORE, and MORE deadbeat SS’s. Until the work environment for our jobs becomes so poor, and risky, that the only ones left in this business will be the hopeful part-timers. The “Professional” NSA”s will be gone!
Yes, I know that there are millions of sub-prime ARM’s out there waiting to adjust, but until someone (in government?) finds a way to put (qualify) these people in 30 year fixed low rate loans, it’s not going to help us. And with our government borrowing hundreds of billions of dollars a month more than they take in, zero interest will not last. Interest rates will go up.
Yes…there still may be a need for the “Professional Notary Signing Agent.” If in the interterm things don’t get so ‘flakey’ that some elected official passes some law to regulate this business, either stopping it totally, or denying the unqualified from participating. Thereby ridding us of the unworthy, non-bondable, unregulated SS’s, and ignorant, unqualified notaries. Perhaps then, if we can get through it, we will again be paid by the borrower, a just fee, reflected on the HUD?
Maybe a few of us old timers will stick? I must admit that I am now a “Part- timer.” I’m old…Semi-retired…(as many of us on this board are) but I’m still knowledgeable, and professional in my duties. I also bring a lifetime of experience to completing ‘a signing,’ and I think I do it well. Yes, I ONLY work for those I trust and respect. I say “No!” to those that IMO are degrading/destroying our business, or the ones that are just thieves. Luckily for me, this job is a vocation…not a necessity.
Someone said in a recent post that we are really “In the driver’s seat!” I agree. We can’t individually effect the enormous changes in the credit/housing markets, but we CAN at least choose for whom we work! JMO!