Being in the escrow business is really fascinating. You see lots of things. You hear lots of things. You get to observe what is efficient and what slows down transactions.
Escrow can be confusing too. We really serve two masters: those that are our clients (the principals such as the seller or buyer or borrower) and those that are our customers: agents and loan officers who suggest and refer work to us or any other service provider. It’s also something to experience such a large transaction “quality control” chasm between different agents working for different brokerages even within a major brokerage franchise network.
But this post really is about how agents and consumers decide what you decide.
1) For example, an interesting thing occured. In the mail, I received a post card from Greg Perry of John L Scott marketing a home not far from my place. It’s not strange that I receive things in the mail from Realtors, but that the owner of the home is a broker from another company—why did they hire another agent to list the house? I know this owner because our kids play together and we’ve closed transactions for him. It is a fascinating move.
2) We have had several transactions with repeat clients who have used a different service provider (agent or loan officer) the second or third time around. Why are they doing this?
3) In escrow we work in high collaboration with just about every title company. Obviously, we do not have primary contact with the sales staff (title reps) but rather the attorneys, title officers and back office staff that are largely the engine under the title insurance hood.
One of the things that I have always wondered and one question that my wife actually raised while we discussed business matters is the following: how do agents choose one title company over another since the perception of agents in the market is that title insurance companies (heck, even escrow firms) all do the same thing and the end result of issuing a title policy or a closed transaction is the same result? In other words, agents have a tendency to say they receive good service, but what is that service they receive? Agents have very little if no contact with the title company other than the with the title rep. How are the title companies differentiating themselves especially when many are using just another name plate but are in fact a subsidiary of a large national title company.
Consumers have no idea how to differentiate Pacific Northwest Title (First American) from First American Title. Or, comparing Land America Title from Commonwealth or Rainier Title (Land America companies). It is kind of like comparing the Nissan Quest with the Mercury Villager. Both are virtually the same vehicle. Consumers rely upon their agent to differentiate for them. How do the agents differentiate between service providers for their customer?
4) Along those same lines, competition is cut-throat between service providers such as escrow and title, especially in a market where sales volumes are significantly lower than over the past four years. Agents are very fierce in fighting for their respetive loan officer or title or escrow company if involved in a sale. Tradition has it’s place, but what is the compelling proposition of one service provider or closing agent over another?
5) What is more important to an agent when suggesting a loan officer: closing the transaction, lowest rates and fees for their customer or client, or a combination? For example, one of the loan officers we work with does average volume but gives phenominal service to the client, loan docs are usually ready days in advance and nothing has ever not closed due to a problem created by this LO. On the other hand, we work with LO’s that due boat loads of loans and there are the occasional problems with service to their clients or other issues.
I can tell you why we don’t use a particular title company (one you mentioned above). They didn’t pull an exact name match (funny spelled first name) on a small state lien item, and then made up a bunch of BS about why they didn’t (e.g. “We didn’t know the owner was a woman.”) It ruined our Christmas two years ago as we tried to keep the deal from falling apart. The title company agreed it wasn’t even a lien due to the homestead laws, but they wouldn’t remove it.
Since then our title rep that we really liked there left that company, and this year at Christmas we took a closing away from that company, to the title rep’s new company. Also, the title rep is really great, so we were sorry we couldn’t use him for a period of time.
When a title company won’t even cover a small item missed in their preliminary, you really don’t want to be spending any money on them in the future, because the chances of them paying a larger item isn’t that great.
I always assumed that agents chose the title company with the foxiest title rep.
How many independent real estate companies are there where they do not have aba’s? I’m glad to be out of title insurance as the office’s I was once very strong in, all have arranged (if not ownership) relationships. Many do with mortgage and escrow too.
Hopefully consumers know well in advance if these relationships exist and have a chance to do their own research.
Title companies can make a difference. 9 times out of 10 (if not 99 out of 100) everything is mundane…but that 1 time you need them, it can be make or break for a transaction. The Title Officer is King/Queen now.
Escrow is very important too. I consider escrow to my “the last impression” my clients will have in a transaction. That’s probably the most important aspect…plus I really like to review the HUD before the agents (or at least at the same time, before is better in case we need to adjust our figures) and before the borrower. I’m amazed when some escrow co’s have docs for days and can’t seem to do this.
My hat’s off to you Tim for being in escrow and blogging. You just don’t see that locally and I think it’s a great value for consumers (and professionals).
laxtosnoco, are you in the biz? You should see my title rep!
laxtosnoco,
Agents pick service providers the same way that people pick agents.
ARDELL, I wonder if there’s a way to track how much business agents send to ABA’s? People do not have ownership in their agents or arranged business relationships.
I know of many circumstance where large local real estate companies have refused to allow vendors they do not part of their ABA to call on them.
Tim,
Our reputation often rests with how well everyone who services the transaction does their job. All are the some only when everything goes very smoothly. It’s rare when one aspect or another does not need greater attention. For some it’s the loan, for other it’s a Title issue and for others it’s the closing agent. Having a team where every one is on top of their game is getting more and more difficult, for sure. But when all participants are the cream of the crop, it’s like a symphony. One instrument out of tune can mess up even the best of transactions.
Rhonda,
If the ABA is excellent, there’s no reason why they shouldn’t be used. But every agent must hold them to that standard and refuse to use them when they are inadequate.
I completely understand the reputation factor. It is real and relevant for everyone. It is one of the reasons people are naturally hesitant to try other services. Sometimes you come to a crossroads as I recall a situation about a year or so ago when we had to shut down a closing the day prior to settlement. It was either close the deal and risk serious potential for litigation (all for a $595 glorious escrow fee) or shut down the closing, lose the customer forever plus their residual business from their office as word spread. The latter happened, as expected.
ARDELL, I agree there’s no reason not to use the ABA if the service and price are fair. However, I do think there’s an issue when other vendors are blocked from promoting their services to agents.
I think it really should be the consumers choice. If I ran an escrow or title company, I’d really be trying to focus marketing on educating and gaining consumer clients.
If an agent is getting lower desk fees, incentive for lower costs and broker are incentised for influencing who is used for title, escrow and mortgage, how fair is that to the consumer? I dare say, it’s almost like a form a YSP since they receive benefits on the back end that does not transfer to the consumer.
More and more real estate companies have created these ABA relationships locking out independent title, escrow and mortgage vendors. Lack of competion in my book is never a good thing.
What I like is service, well done, not rare.
Ardell is correct. We use who we use because we value smoothness and reliability more than life itself. Our reputations are determined by how well our providers respond. Our expectations are that (and insistence) that our clients needs will be well served, and that mistakes or sloppiness will not happen.
We don’t want last minute surprises or mistakes such as Kary experienced on Christmas, or any other day. I dread dealing with unknown people. And, it’s the people, not the companies that make the difference every time.
Lax, since most agents are women, we could give a rats patootie what our rep looks like from any company, since reps are 99% women. And why is that anyway?
Rhonda, don’t believe everything you think you hear and know. Agents are independent contractors, and we use who we feel represents our clients well and who won’t make mistakes, will go the extra mile and all the usual reasons anyone uses someone or some company repeatedly. I don’t know anyone in any real estate company who plays the “party” line.
The only way I truly meet a new vendor is thru a transaction – meeting a sales rep in my office tells me nothing about service per transaction. When I get extraordinary service from title, escrow or lenders via a transaction, I notice it, and keep a file of who was involved in the event I come across them again, or decide I need to use someone new.
Leanne, not only was I in the title and escrow industry before mortgage and I am still very close to the title/escrow industry.
You might be quite surprised as to what I hear and know.
Agents are pressured all the time. Congratulations for being independent. I wish more were. Isn’t that what being an agent is all about?
lax wrote: “I always assumed that agents chose the title company with the foxiest title rep.”
I don’t find “Curtis” foxy at all, but maybe my wife does. 😉
In Chelan County it is customary to use the same company for title and escrow. In Leavenworth we have just two of the big firms, with more choices in Wenatchee (which is inconvenient for most clients.) I tend to send most of my business to one of the companies over the other because:
1. One of the title guys (expert, researcher, etc) used to be my favorite closer. He is a details guy and is always very helpful. He understands customer service and someday I will find a reason to hire him for myself.
2. The local owner/ manager takes ownership when there is a problem. I have heard of him putting clients up in a hotel when escrow screwed up a closing.
3. The brand (nationally) has a no questions asked money back guarantee for their escrow service. I have told clients to use it on the rare occasion the service isn’t perfect. Why pay for service that isn’t perfect.
4. They aren’t affiliated with our office, but they are next door. If I can’t get the escrow officer on the phone, I just stand at her desk and wait. That’s accountablility!
My clients always get to choose their title and escrow, but so often they don’t care or know which one to choose. Clients always think that real estate transactions usually go smooth and easy. I try to pick an escrow company might allow that to be true some small percentage of the time.
Ardell wrote: “Agents pick service providers the same way that people pick agents.”
I’d disagree, at least ultimately. Many people really might not have a clue whether their agent is doing a good job. An example is the dual offer situation where an offer is rejected because of sloppy paperwork by the agent–most consumers wouldn’t know that. I’d hope, however, that most agents would recognize when the work isn’t being done properly (although I’m sure a lot does slip by).
Geordie said: “In Chelan County it is customary to use the same company for title and escrow.”
That sounds like a huge coincidence for a buyer to choose the same escrow company most of the time, that the seller chose to run Title before the property was listed for sale. Isn’t title pretty much established at the time it is listed, and doesn’t the buyer later choose escrow, in Chelan County?
Sometimes it feels like the agents choose the company who will do what they want that week. It kind of torques my jaw when I hear things like …” well so and so will do my postcards for me…” or so and so will do a deed after closing adding the borrower (who the lender just instructed us to take off) back on to the title. Both these things are against the regulations yet many Realtors have no trouble asking.
But then I hear from our loyal clients who appreciate out proactive approach, our style of partnering with them, our response when a problem comes up and our policy of refunding our escrow fee if the closing does not go smoothly.
Too bad they all don’t appreciate why we can’t and shouldn’t do certain things!
Nancy,
I’ve died and gone to heaven. Finally, after two years of blogging on RCG, a comment from an escrow/title person!
Let’s nudge back a bit towards my premise: what makes agents or LO’s decide to use services you suggest for clients? I’m reading “good service” but I’m not entirely certain people are defining what that is. Is service getting a mug from an escrow office? A pen? A calendar? A newsletter with recipes? Ordering pre-liminary title on a listing? Getting a flyer box with x company stamped on it? Getting farm, listing or other data?
For example: every home inspector inspects a home and issues a report. Every title office issues a policy or closes a transaction. Every loan officer originates a loan. Everyone in real estate spins the “great service mantra.” How do people know what the difference is between companies (inspectors, title, escrow, LO’s etc..)
Hi Tim,
When I processed mortgage loans in the mid 1980s, it was part of my job duties to clear title prior to sending the file across the hallway to escrow (I worked for a national mortgage bank.) I was brand new but kind-of a rising star because both my parents were actively involved in mortgage lending. Sometimes I think this was why I was give preferential treatment by the title companies but I’ll never know.
As a brand new processor the title company at the time, Safeco, whose rep was really service-oriented and friendly, brought in a title officer to teach me everything I could absorb about title insurance.
Every week he would come in time after time. I attribute this learning to my eventual migration to title insurance a few years later, but I digress.
The title officer (TO) that was training me was recruited to a competitor. The title rep came to me and asked me who their company should pick as the departed TO’s replacement. I told him that the TO’s assistant was who I wanted to work with. They listened to my logic and reasons and sure enough, he was promoted. As a lower-level worker in my early 20s, I was impressed that a company would consider my input. To this day, I still believe he is one of the finest title officer in the state. His name is Doug Pittman and he has worked for Chicago Title, King Co this entire time. (Safeco was purchased by CT.) I also admire many, many other title officers in King and Sno and Pierce counties. Escrow officers as well. The main reason is because I KNOW they will know the answers to my questions and I know they have extremely high level of professional character.
Also, Doug Pittman never sounded stressed out on the phone. I don’t have that skill. How could he not be under stress all day long? Because of this, when I talked with him, I got the feeling that everything was going to be okay with the tone of his voice.
Steve Simmons @ Chicago Title Snohomish County does that same “good phone” voice thing.
It’s inside them. It’s their inner character, and I was drawn to this so much that I would fight to have my deals sent to this company.
And, of course, because they sent male title reps to call on me. Smart move. All the male title reps were charming and helpful and interested in ME. Everything a good sales person SHOULD be. When their company messed up, apologies were direct and humble. No company is perfect.
Here’s a rep I watched closely. Linda Harada, at the time was with Trans America Title. She wanted my business so bad you could smell it. Somehow she got me to give her company a try, even though her title officer sucked. I was so impressed with her ability to “sell” me that I kept talking to her to observe how she did it. I said to myself, “I want to learn how to be that pursuasive” and eventually Linda and I did work together at CTI for awhile.
But this is taking too long and I have boatloads of work to do before I jet off to see “Girls Rock!” at the Seattle Film Festival theater today.
I owe everyone a follow up post on Affiliated Business Arrangements (AfBAs aka CBAs-controlled business arrangements.) This is forthcoming.
Tim,
For inspectors it’s their being able to find things without you having to point them out! With all of them I’ll still look around myself to try to find things, but some of them I swear are blind. Also the form of their report is important.
For escrow, it’s their doing the work before it needs to be done. It has nothing at all to do with services after the fact. It’s being in a position to close on the date of closing. There are some escrow people out there that seem to go from deadline to deadline, not acting on anything until they absolutely have to.
We’ve never really used a lot of the extra services title/escrow companies offered (before the limits). Getting mailing lists was about it.
Ardell-
I know this sounds crazy, but we just started ordering pre-lim title at listing.
So to answer your question, it is now possible that escrow and title are at different places. (But since we just have two shops in town, it’s still a good shot that it will be the same place.)
Tim,
Even after selling real estate on the West Coast for 10 of my soon to be 18 years in real estate, I ‘m still dumbfounded that agents want to get anything from a client service provider. I never saw Title Companies provide postcards and flyers, etc. on the East Coast. Seems like monetary incentives were replaced with tangible incentives on the West Coast, when the East Coast “just said NO” to any form of kickbacks back in the early nineties. Or perhaps that may be just my experience.
In any event, Title Companies often get insulted when I look at them like I need to take a shower when they come in with a new “offering for agents”. Why is anyone thinking that taking “stuff” is different than taking actual dollars?
To answer your question:
Title Company: The one that acutally does a Title Review and sends me a red flags report. Someone who really knows their stuff, and that is not the Title Rep necessarily, but someone else inside the Title Company. Reps are Reps, but having someone inside who is on top of their game with superior knowledge and skill is the key, more than the rep who visits the office.
Escrow: Of the buyer’s choosing, but in a location that is convenient to both the buyer and seller, unless they offer a mobile service at no extra charge. Escrow should most often be relatively close to the property being bought/sold and not simply close to the agent’s office. With agents selling many miles from their office these days, expecting people from Kenmore to go to Federal Way to sign papers is just very selfish on the agent’s part.
Cost is not a factor for me in Title and Escrow services, or most any service. I’m more than happy to pay the increase in cost to be able to recommend the best of the best people. I always tell my clients not to choose for a $50 to $100 price being lower. I’ll pay it! Don’t choose by cost.
Anyone who treats the transaction as if it is always about the seller, and the buyer is just someone who comes and signs so the seller can sell his house, gets crossed off my list…and they are many. Of course when I have the seller I will recommend “my” preferences, but my preferences are based on someone who is fair to all parties and I fully expect the buyer to choose escrow when it gets around to Purchase and Sale Agreement.
And don’t tell me they are all neutral…cause they AIN’T! They know where their bread is buttered and listing agents in a seller’s market RULE…but shouldn’t when there are not multiple offers. I can’t tell you how many times when I had to use the listing agent’s escrow due to multiple offers, that I found seller costs on the buyer’s side. Then they look at me like I’m being unreasonable and “picky” when I point that out.
Home Inspector: Depends on the property. I have three favorites depending on age of property and where it is. They are not equally qualified in all things. My preference for newer condo or townhome or even house, is different than one built in the 50’s through the 80’s and different for older home built from 1880 through 1929.
Lender: Depends on the qualifying factors of my client. The best of credit scores and high downpayment equals lowest cost and high competition regarding rates and programs. Poor buyer qualifications equals best at harder situations and costs are often higher but not rate and terms and programs.
Think about it? How can any agent be matching the best services for their client if the answer is always the same one? Best for client or best for agent are two completely different things, and best for client can’t always be “the one next door to “MY” office”.
Tim:
Sorry to be so late to the party! My dear wife insists that I spend more time with the kids, and less time “virtually” away.
A couple of quick thoughts, mostly from the refi angle, since that is a situation where the LO gets to pick both.
Title:
Not much difference in costs between “Title Companies”, and service seems largely similar 98% of the time.
Escrow:
Big differences in costs and service. Sometimes, our choice of lender will dictate choice of escrow, since there are a few banks that will not accept E&O insurance (from independent escrow agents) in lieu of a Closing Protection Letter, (which are only available from escrow companies that are affiliated or wholly owned by title companies).
My major escrow beef these days is over the high reconveyance fees charged by some escrow companies, which can cost my clients hundreds more, so I always ask about them.
I tend to stick with trusted closers who know me, as I want them to be confident in explaining anything and everything that could arise (or getting me on the phone, when they are unsure), rather than feel like they have to dance around a ticklish subject to avoid any controversy.
Finally, to ask a new question, what’s this I hear about LO’s and RE’s not being able to come to closings? Not that I make all of them, but I like to be able to show up from time to time.
Future blog? Aren’t there some new laws/regs from DFI coming out?
These are really great points made by the commenters. Lot os opened ended points made in the post and HIGHLY opinionated commenting. Love it!
Title companies are a dime a dozen. The client goes with the realtors referral period. Same goes for the loan officer.
Tim
I read often, comment sometimes. But I love rain for the variety of commenters.
The differences in pricing between title companies is small. Excellence and proactivity, I believe, are the qualities to look for. We do “buyer to come” orders…extolling our agents to ask tough questions at the time of the listing and then partnering with us to resolve those often thorny issues that may be uncovered. Deaths, divorces, the need for a Power of Attorney, locating heirs and the irritating problem of a Deed of Trust thats been paid off but not reconveyed.. All these things can be resolved before the listing agent entertains an offer.
How about how problems are handled? Does the escrow agent cower in the background or become a facilitator of action and information? It takes a team to sucessfully navigate today’s closings.
Honesty and integrity are crucial…….when you have one player (that agent who just does not call back, or the lender who promises and misses 5 dates with loan docs) who does not bring those qualities to the table it’s like trying to drive a car with a flat tire.
Ardell, Roger et al…
I think what you mention, and Jillayne as well, is key. The people behind the scenes that have specialized knowledge are the one’s that are creating the value. The problem is, they are not the rep’s you see. They are the differentiating factor.
Roger, I hear you. But how are you deciding which title to go through if there is little difference to you?
Being in the escrow business and in contact with title companies every minute of the day gives us an unfair advantage to see the gears turning and what needs oil. For agents and LO’s that experience is largely absent. To be fair, it’s really not your job to know.
There are countless stories of sterling service, real tangible problem solving, workarounds and transaction issues that go un-reported by title and escrow. Every title office, every escrow dept. has countless examples, yet for some reason or another it is not relayed to those to whom it matters most: agents & LO’s. Whereas the focus for agents & LO’s seems to zero in on “what fees” are charged, or some other issue. You want to know what makes title and escrow offices break out in laughter? Asking escrow to drop a fee or something “to make it work,” when I’m about to sign my name on a check cut to them for $10K on a $250K loan.
And with that, I’m off to meet with two clients in downtown Seattle this afternoon. Looking forward to the discussion continuing.
But before I head out, I’d like to ask agents a question:
the next time you are with any rep from any organization be it title or escrow, ask them if they can tell you the name of your current or last client in which they wrote a policy for or closed a transaction with. Bzzzzzzz. I hear the hornets nest stirring.
🙂
Jillayne, I was Doug Pittman and Adoline Brown’s Title Secretary (they don’t use that term anymore) back at Safeco Title…I was with the crew that made the move to Chicago. Doug never “sounds” stressed but I can tell you he was the only TO that I saw RUN to the title plant and back to the phone.
Back when I was a title rep, I reviewed all my agents TBD’s and prepared a one page summary for them. I really did what I could to add service and not be a piece of blond fluff with rate sheets and donuts. It was really to my advantage that I had worked a few years in the title units before I became a rep.
TO’s mean everything to me. Title reps do not (sorry Nick!). I respect a TO who can see “beyond the book” and who can weigh out risk and make decision. Most can’t or wont’. When I was a rep, I’d bonk heads with a few TO’s if I’d make suggestions for solutions.
John Wickwire was a recent favorite until he passed away and I have to say that Tim Daniels is excellent. He’s very creative (and a funny guy too).
Can any RE agents who work for the “big companies” honestly tell me that they don’t hear from their brokers that using their affiliate, in-house or aba vendors does not keep their cost down (desk fees or misc)?
Tim:
I answer yours, if you can answer mine? 🙂
For title companies, it is the title officer, not the rep that makes a difference. I did shop costs a while back, the title co that I was already using had very nearly the lowest costs. Insufficient reason to change.
So what is the deal with reconveyance fees? And what about that new proposal? Something called uniform general closing instructions?
Deferring the answers to a later post is an acceptable answer, hey, its the weekend, and you are not a paid consultant!
BTW, you have a great looking website!
Rhonda:
#29 reminds me…have you or Jillayne looked into or posted on the practice of bundling selling homes and mortgages? Both RE agents and builders do it.
Something about it just doesn’t seem right. I’ll give you $X,000 off the price of the home (or the loan, or the RE services) but ONLY if you use my preferred lender.
It smells like a RESPA violation, but I have been told it is not.
Just curious. Might be two different subjects.
Rhonda, I don’t know if you consider Keller Williams big (we’re bigger nationally than locally), but I’ve never heard a single comment mentioning that we’ve never used the affiliated mortgage company. And it’s not that I have anything against it. It’s just we’re really happy with who we used prior and have had no reason to change.
BTW, I really have to disagree that title companies are a dime a dozen. Back years ago in the bankruptcy area we could only use a couple of them because the others didn’t provide complete information on judgments. And some of them are just sloppy. I had one two years ago where they reported different judgments on the same seller for two different pieces of property, and the amount of one of the deeds of trust was wrong.
Kary, I agree with you on title companies. I can see how on the surface it would appear that way…afterall, they’re ALTA policies. However, there is a difference with service and with how some title companies may try to bill by upselling a certain policy.
Roger, I’ve written about builders/lenders before here at RCG. 🙂
Kary, does Keller have an ABA relationship with title, escrow or mortgage? I know KW is strong locally…I’m actually thinking more Windermere, JLScott, CBBain…
Tim can we delete this?
Ray we don’t allow blatant self-promotion on this blog. Please add to the dialogue and leave your website link off the signature line.
Your comment has nothing to do with the discussion.
Ray, you are welcome to try again, but please offer us some insights as to what Tim is asking us.
Hi Rhonda,
RE Comment #28, Then that means you and I probably talked on the phone! I think Adoline is still up in Whatcom County as the CTI manager.
I have a post in draft mode about affiliated businesses that I will post soon.
Jillayne,
I popped it out. Tim’s probably sleeping. I have a new listing to load up before I go to sleep. It’s not included in tonight’s stats post 🙂
Kary, Curtis is great. Foxy? Well, his wife might hit me …
Tim, my closers and lo’s know the names of our last clients. I use who I use because they are smooth, prepared, and handle things well. I don’t agree that title companies are a dime a dozen, nor have I ever asked a title rep, escrow or lender to do anything for me, except go the extra mile for my clients.
I have been with Windermere since 1988, and never has Windermere said if we use their affiliated business relationships that it would keep our agent costs down. It’s laughable to think that actually.
I’m a 100% desk fee agent, and use who I please on all of my transactions, with never a comment back that I should do differently. What we are told is that we have competent people affiliated with Windermere that we should feel free to recommend to clients, but that we have no obligation to use them in any way.
And trust me, we’re a bunch of strong agents, if we don’t like something, we’re not pushovers about it. Check with Curtis :-).
I happen to think Windermere Mortgage has some extremely competent LO’s, but don’t typically use them since I have long term relationships with others. My title rep has great service and I like both Rich Jones and have used Doug Pittman too. Linda Harada is a great rep too.
Quite frankly, it was a real struggle for my office to consider having a mortgage rep affiliated in any way with Windermere, but we were won over by some very competent people who did not push for our business,but were there when we had questions or whatever. It still works that way.
I will try again since my last post was deleted. It IS very important who you list with. It is my personal belief that Nobody should pay a fee greater then 1000 to LIST a property. Pass on the savings to the buyer. Always pay the BUYERS AGENT!!!
The person who has the buyer has the value. Never……..EVER……….pay high fees to list. Offer a lower sales price or A Buyer Bonus to stimulate a potential sale.
But, more important then anything is price your home accurately and very competitively to the mkt conditions we are in. Keep your options open to rent or lease option. Always place your home on Craigs List in addition to the MLS.
Educate Yourself Washington and FIND THE RIGHT AGENT!
Leanne, I’m glad you replied to my request about ABAs. The offices that I’ve called on for over 15 years…well, it’s a different story than your office. As we both know, each office has their own personality.
I could list many examples of reps being shut out of offices due to ABA’s…this is the actual reason they’re given.
I believe there’s also some pending litigation in our state regarding this matter.
I certainly glad that this doesn’t happen in your office.
I think choosing who your work with as a lender is important as is the realtor and finding a title company to be qualified and timely and accurate is good also. It takes research to find the best in your area and sometimes interviewing them by phone or appointment is necessary to see how they can best help you make this large purchase.
For me it’s about service.
I carefully work to create huge emotional bank accounts with the service providers that I work with.
1. I do not ask them for perks or favors (and do not take part in them)
2. When we go to lunch, I buy the lunch, or at the very least keep a reciprocal arrangement with the service provider.
3. I work hard to create relationships and really get to know the person. I show interest in their business, families, hobbies and interests.
In short I work hard to treat my best service providers just like I would my best clients.
When a transactions hits the skids — no matter how hot the market is, having that emotional bank account assures me that me and especially my client receives the best of care and attention.
In the world of title, I took the time to meet the Title officer (the person who actually does the work). I feel comfortable bypassing the rep and calling him when I have a title question.
In the world of escrow, my escrow officer has stayed late with a file, or create amazing solutions for signing difficult people. I know the service levels and my clients and I can depend on them.
Rhonda,
Regarding your ABA question: While the Brokers don’t insist that the agents use them, I have seen them shut competing reps out of the offices. I do not like this practice.
Candidly, many real estate agents have been so coddled, wined and dined by the service providers that they have become “takers”. It’s the “You can have my business — what have you done for me lately mentality.
I think it’s fairly easy for an agent to separate themselves from the pack by being a “giver”.
Greg, thanks for your response! 🙂
I was once a favored rep at one of the offices I called on for title/escrow (pre ABA). I was allowed to respectfully “cruise” the office and probably worked with more than 50% of the agents. This office is a desk fee and fought against the rest of their company for adding their mortgage, escrow and title. When we were moving my title and escrow branch, I selected a local near this office.
At one point, the broker tried to hire me to be their in house mortgage person. I declined. I prefer independence and it could shun the agents from outside offices.
I’m no longer allowed “back”. They do promote their inhouse title, escrow (not so sure about the mortgage). I can stuff bins or make appointments and really, I prefer to meet with people by appointment (especially as a Mortgage Professional as compared to a Title Rep). The tone is different. I’m so glad I’m not a title rep anymore!
Quite frankly, I don’t really call on offices anymore. I have my relationships and welcome new ones. It is all about relationships and being respectful of your team players.
Apologies if someone else answered this question (I didn’t see it addressed in the comments), but with your broker/neighbor hiring someone else to sell their house — some brokers have a rule that their agents and brokers cannot sell their own home. The previous owner of my house is a real estate agent (and good friend), and she told me she was not allowed to sell her own house by order of her broker.
Now to the crux of the post — from a consumer’s point of view, I have had reason to be careful about which excrow company I use. I had a very bad experience with escrow when we sold our condo years ago — there were several delays on the escrow side that had nothing to do with either the buyer or me; they were just slow and disorganized. And to this day I don’t think the settlement statement was correct.
So when we sold our last house, we told our agent about this, and he made sure we got to name the escrow company for the transaction; things went very smoothly, and we were very happy. Now, as far as who we chose, we relied on our agent’s expertise, but we trusted him, and our trust was rewarded.
Greg:
Well said! I hadn’t thought of it in terms of “emotional bank accounts” before, but it makes sense.
When things go seriously sideways (and no matter what ANYONE tells you, they will), you need to get honest answers, effective solutions, and priority treatment.
On occasion, you can get that from a one time transaction (I got great service and pricing from Chi Ti in Gig Harbor recently, including the right answer about reconveyance fees), but we all feel more secure going with a trusted vendor.
For the LO/mortgage broker (IMHO), those key vendors are, in order of importance: the lender, the appraiser, escrow, and title.
The order of importance of vendors would probably differ for RE agents.
Greg,
To be fair, most front desks “shut out” people trying to sell to the agents, whether they provide that service or not. I’m pretty sure they wouldn’t let 4 home inspectors a day wander through the office to introduce themselves. There are never ending requests to present to agents at one of the meetings from all sorts of people. Print ad people, health insurance providers, virtual tour people, client follow up programs.
I’m sure you have had them “stop by” your Open House while you are trying to do your job and there’s no front desk person to disuade them.
There’s a big difference between telling the agents who to use, and telling the various reps they can leave their material, but not wander around the office to drum up business.
“The previous owner of my house is a real estate agent (and good friend), and she told me she was not allowed to sell her own house by order of her broker.”
I believe that has to do with Error and Ommission insurance policies not covering the transaction if the agent is also the owner.
Greg:
Also, since it is an emotional bank account, I am VERY careful not to pressure or dictate to my trusted vendors. However, I may question them to the point of madness :), in my quest to understand their POV vs. mine or my clients, but you cannot build emotional trust with your vendors if you play unfair.
I also try to make it a habit to keep at least more than one “favorite” in all key categories. That’s a little trickier. Everyone wants all of your business, naturally, but I think it puts too much emphasis on the relationship, instead of the outcome.
Of course, I have to tell my faves that I’m seeing someone else, too! And when business is slower than usual, everyone thinks I’m cutting them out in favor of the other vendor!
If only it were just that!!
Ray wrote: “I will try again since my last post was deleted. It IS very important who you list with. It is my personal belief that Nobody should pay a fee greater then 1000 to LIST a property. Pass on the savings to the buyer. Always pay the BUYERS AGENT!!!”
That’s just as absurd as a full service agent saying discount services shouldn’t exist. It’s all about choices. Some people want and need the extra service. Some people just need it. Some don’t want or need it.
Rhonda, our office just has an affiliated mortgage company. Even though I haven’t used it yet, I do appreciate it being there. It’s a good additional source of information (which gets passed along in the hope that agents will use the services).
Ardell, thanks for being on top of that situation. Over in P-I land, where anonymous posts are allowed, seemingly every customer of a small on-line broker startup has posted about how great the company is. You’d think they were a present threat to Redfin from the number of posts by satisfied clients.
Yes, Kary some people MAY want or need more service and thats why the Brokerages that offer a MASSIVE discount and still give you full-service are the ones YOU need to seek out. Its absolute insanity to pay 1-3% to LIST your home. In this time more then any! We have a crisis of confidence out there and people need to save. The seller needs EDUCATION not a 1-3% charge at closing to a Listing Agent.
Sellers must be on the MLS and Craigslist and they need to price their home aggressively. Again…Pass that savings onto the Buyer…LOWER that price…Buyer Bonus….
Red Fin has an outstanding model but they charge too much to LIST and do NOT give enough back to the customer. Their model CAN be improved. But, they should never charge to tour homes. NEVER!!
Educate Yourself Washington! Change is very good! This collapse across the Nation will assist in change for the CONSUMER that will benefit us all.
Ray,
Seems from your website link you are saying to sellers, ALWAYS pay the buyer’s agent and NEVER pay much for your own agent. Can’t you make the same argument for the reverse? Why should the seller pay more for the representation of someone else, than for their own representation? Many believe there will be a trend where sellers only pay their own agent, and the buyer will pay for their agent.
Since it is the buyer agent’s job to basically “work over” the seller and get as much for the buyer as possible, why would a seller want to weight their expense heavily toward the person whose job it is to get the most out of them?
Why not say only pay $1,000 period, and offer the Buyer Agent a dollar and let the buyer pay their own agent if they want one?
Ardell,
I agree it’s important not to let vendors have too easy access to the office. Title reps were always an exception. They had free reign, virtually not bothering to check in with the receptionist until……the brokers affiliated and gave them the boot.
I think we can all agree we are a better industry now that the insurance commissioner has cracked down on title companies and their huge give away incentives. We’re better, but still have a ways to go.
Roger, your comment about not pressuring your trusted vendors is insightful. Every service provider must be allowed to do their job within the confines of their personal ethics. When we find a competent, ethical service person we WANT to do business with them. We have to let them do their jobs. When trust develops and an emotional bank account is established, people go the extra mile. That’s when miracles happen.
Did Ray just hi-jack this post?
Ray:
I’m a bit new to this kind of environment, so I am always glad to be educated in the finer points of nettiquette. I understand the rules to be essentially:
1. No blatant self-promotion.
2. No personal attacks.
While I think it safe to say that most authors and commenters (including myself) are indirectly promoting themselves, your comments seem to me to cross the line regarding self-promotion.
It seems more like an advertisement (ie use my service, not theirs), than a comment on the topic.
Let me emphasize that I am NOT calling you out personally, as your comments may be viewed by the RCG community at large as entirely appropriate.
It is more that I am seeking to understand what this community considers to be appropriate behavior/comments, and to what extent I could increase promoting my business, without violating those boundaries.
Comments anyone?
Kary,
The primary concern is that agent’s not get too attached or obligated to any particular service provider. We’ve all seen fabulous Escrow or Title companies go through periods of changes, where during that time the service wasn’t up to par.
I remember the crux of the “no kickbacks” issue being, you need to be free to switch to someone better at all times, and not be influenced by what that provider is giving to the agent.
Unfortunately there’s no way to stop agents from picking attractive people. Hard to put a kibosh on it, when what the agent is getting is some eye candy.
Roger,
Every morning I delete spam comments from the site, though most are trapped by the Askimet spam filter, and almost all are trackbacks and not actual comments. I do it during the day as well, but mostly it’s a one eye open while I’m drinking my coffee activity.
Tim’s initial question included, and in fact started with the question, “Does it matter who you list with…” So while Ray’s comment may not be following the direction of the current comment stream, I’m sure it isn’t off topic.
The other day I warned Michael L. about posting signature and contact info at the bottom of every one of his comments. The link out to the site via the poster’s name is the only “self promotion” permitted, and should be more than adequate.
Is someone commenting here just for self-promotion purposes? Maybe. Only the person posting comments can know for sure.
If Ray had not started off with a self promoting comment, and then come back to figure out a way to do it without getting deleted, we might not be questioning his motives.
We have discussed do you pick Title or Escrow services by cost alone, or lender services by cost alone. Ray brings up do you choose an agent by cost alone. Since the agent fee variances are much more dramatic than any of the other services we are talking about, clearly cost is definitely more of a factor in that arena than most other services.
The primary expenses for a seller are agent fees and excise taxes. Not much you can do about taxes, but there is much that can be done regarding agent cost.
We all acknowledge that we are seeing more short sales now than as far back as most can remember. So leaving agent selection and cost of that service out of this discussion or thinking it is “off topic” would be “self-serving” from my perspective.
We have very few “trolls” here at RCG. We have been very lucky in that regard. As to your experience at the PI and your suggestion that the posters are fake testimonials, just have your moderator check the IP addresses. It’s fairly easy to determine if they are coming from legitimate sources.
I think I am currently the primary editor here at the moment. Dustin has full capablilites and Robbie and I have full edit authorization for all posts and comments. The other contributors, to the best of my knowledge, have the ability to control comments on their own posts but not one another’s posts. I have to be very careful regarding whether the poster is simply pushing my buttons or is truly a spam or troll comment. I do my best.
With regard to Ray, since the “shout out” to edit came from Jillayne who has no self-interest reason to care and rarely suggests a deletion, I took her vantage point as a sincere effort to eliminate a troll comment.
I take my cue from Dustin’s general philosophy, since he owns this site. Since Dustin teaches that a good way to promote yourself is to leave intelligent comments on other people’s blogs, it wouldn’t be fair to draw the line too closely or to examine “intelligent” comments too finely.
Roger and Ardell I’m very new to this site as well. I’m usually on Seattle Bubble and The News Tribune but I took a day off today.
The buyers agent “works over the client”…wrong wrong wrong. You are thinking of MLS 4 Owners. A proper model ( I will not self promote) gives full representation with every listing be it 500.00 or 3% listing fee.
Please, just because some models charge a fee far less then the norm don’t ASSUME they are a discount type company. SOME NEW companies get paid by other sources and do NOT rely on commissions solely.
Ardell my 1st post here was rejected because of me posting the company name. I will not do that here in this forum. I thought it was like Seattle Bubble. My mistake . Just be happy there are models in real estate that are bringing many more buyers to the table for they infuse cash to the consumer and not extract.
Ardell:
Wow!
Thanks for the explanation. It is interesting to get a behind the scenes look at the production at RGC. Intuitively, it seems there must be a fair amount of time commitment to write the articles, but I didn’t put much thought to the effort to keep the entire production going.
It must be a constant struggle to weigh your own interests against “contributing” competitors, and those that merely seek to “use” the community at large.
You, in particular, seem to invite controversy. Perhaps it’s because no one will pay to watch a knitting circle, but they’ll line up for a cat fight! 🙂
Personally, I try to be mindful of the need to give back to any community that you derive benefit from. I have definitely derived benefit from reading and commenting, in the form of knowledge and self-discovery, (if not any direct business), and have at least attempted to bring intelligent comments to the table.
Thanks for the ruling yer honner, can we go back to play now?
Ray, you and I apparently have a different definition of full service. There’s no way anyone could make a living providing the services we do and only charging $1,000.
I’ve only dealt with Redfin once (I actually referred the buyer to them), and they were AWOL when the counter-offer came back. The contact person never returned my call.
Also, you have to be kidding? Craigslist? I don’t use this much, but this really calls for a ROFLOL. Maybe if you deal in a sub-$200,000 market that might work. I periodically post things there and it’s the least effective tool there is.
Ray,
All I’m saying is why not offer $500 to the buyer’s agent AND list for $500 both? Clearly it is NOT the job of the buyer’s agent to do anything for the benefit of the seller. So why not strip both costs down, or pay your own agent (for the seller that would be the seller’s agent) and create the savings on the buyer side?
Why wouldn’t the buyer’s agent work hard to get the lowest price and the most they can out of the inspection, etc…? How is that “wrong, wrong, wrong”? It would seem to me to be the opposite, as any buyer’s agent who isn’t looking to find weaknesses in the seller’s position, like the seller not having any representation, would not be doing the job they are paid for which is to represent the buyer well.
I don’t know your service. Do buyer agents deal directly with the seller under your model?
I see this on your site: “If you cannot come to our office please email or fax to us the offer you received.”
How can it be “full service” if the buyer agent has to present the offer directly to the seller with no agent for the seller present at the time? Why is the seller faxing you the offer himself instead of the buyer agent giving it to you, the agent for the seller, in the first place?
I have no problem with many and varied choices in the marketplace. But let’s not pretend that a “FSBO in the mls” service is something it is not. Maybe a seller doesn’t want Open Houses, maybe a seller has no problem with dealing directly with the buyer agents and only calling you if they have a question. Great! But don’t pretend the service is identical, that’s just misrepresentation.
Why not post an honest list of what you don’t do that full service does do? That would be more credible than suggesting “full” when it clearly is not.
Kary,
Seems to me that Craig’s List is one of the best places to post Open Houses since the MLS made the rule that you can’t post that in the public remarks section.
Do you know any other online place to announce Sunday Open Houses other than Craig’s List? I do wish there was an online service that listed all Open Houses by neighborhood or zip code.
Ray said:
“Ardell my 1st post here was rejected because of me posting the company name. I will not do that here in this forum. I thought it was like Seattle Bubble…”
Hasn’t Seattle Bubble called you a Troll yet? We are like Seattle Bubble in that all blogs expect people commenting to be doing so to add to the conversation, and not as a means of advertising themselves primarily. Look up “internet troll”. You may find it informative.
If and as you answer the questions that we raise, it will help to establish that you didn’t come here simply to advertise your service.
How IS your model different than MLS4Owners, since you brought up that obviously similar service. Don’t they both state that the buyer agent is to present the offer directly to the seller, vs. other business models that don’t put the seller in the hands and space of the buyer’s agent?
Quick drive by comment..
Greg brings up an interesting issue:
“I think we can all agree we are a better industry now that the insurance commissioner has cracked down on title companies and their huge give away incentives. We’re better, but still have a ways to go.”
At what point do you disassociate yourself from companies that have been in the news lately?
Ray, FWIW I thought your first comment that was deleted smelled spammy.
Rhonda,
I think that Ray is making an honest effort to promote his business by leaving comments. It often takes awhile for some to understand that promotion via blogging and commenting on blogs is less of a hard sell strategy than they may originally perceive. Just part of the learning curve.
Only Tim has the original comment in his email. If he still has it, maybe he can repost it so we can dissect it LOL. Or maybe Ray has it.
I’m more likely to answer a request to delete a comment without a long examination after 11 p.m. than I am during the day 🙂
Tim, do you mean mortgage companies? When title companies are fined?
I’ve actually started asking clients during the application if they care if their mortgage is brokered to a company who’s been in the news lately. I did a survey on my blog too. It’s pretty 50/50. Some don’t care and they just want the lowest rate and others do not want to be brokered to banks who’ve been poster-childs for the mortgage crisis.
MLS 4 Owners and 500 Realty is completely different. They target sellers we target buyers. We get paid by advertisers and commissions. We offer the best in the Nation in terms of service, honesty, and integrity.
When you list you do NOT get:
*fliers (we email to seller the listing for the client to print and fill box)
*open houses ( we advise sellers to place a balloon on our sign and sit in their open house on Sundays- and yes post it on Craigs List)
*we do not pay for staging, or newspaper ads
The 500 listing plan just like MLS 4 Owners puts the seller in a position to sell. But, when an offer is received we act in FULL SERVICE and do offer guidance, support, all the way to close. We have live Agents unlike MLS 4 Owners. All the while the seller will be educated about our 75% credit to the buyer.
BTW DO NOT LAUGH AT Craigs List. Market data is indicating they are getting very high traffic. 2 buyers already approached us after finding their home on Craigs.
Yes, maybe I smelled spammy. I apologize. But after the Puyallup Fair, Tacoma Home Show, and Seattle Home Show you begin to just want to scream to the WORLD—-” Go to the WEBSITE——-Then Bash if its still fitting. The model works and so does MLS 4 Owners and Red Fin.
I applaud change in any industry that is better for the consumer. exp. Orbitz, Priceline, …….. Society is changing. Earn that 6% !!
Tim,
Good thought.
Actually several years ago, I directed a few transactions to the biggest offending company. They became so agressive for my business that it turned me away from them.
The company that I use now is one of the cleanest companies. To answer you question, I disassociated with the biggest offender years before they were pinched.
Ray and his cohorts are not all that naive about what they’re doing. They get called out constantly at Seattle Bubble and SREP for blatant self promotion and spamming. Rarely do they actually participate in the discussion.
Ardell, I don’t have a good solution for advertising open houses. Zillow has a spot, but I don’t think anyone looks at it. Same for the ones that are dedicated. So far all I’ve come up with is listing it as an open in the MLS, and then hoping people find it through one of the other sites (e.g. Windermere).
If we’re talking title companies, has anyone seen rates go down since the Insurance Commissioner cracked down on them? I view the crackdown as being something the title companies would say: Thank you! It probably has just increased their profits (even after the fines).
The problem I have with “Ray and his cohorts” is more that from what you read in the blogs you’d think they are a major player. They are not. Unless I’m doing my searches wrong (using 4477) there are probably hundreds of agents locally that do more transactions than the entire firm (even excluding agents that do new construction).
I don’t have a problem with them trying a new approach, and I wish them well. But right now I think they’re rather like the man behind the curtain in Wizard of Oz.
Kary,
If you don’t have a better place to post Open Houses than Craigslist, and I don’t, then it would seem that Ray is correct.
Ray,
So basically you are getting sellers to sign up so you have inventory, but are really a model based on buyer agency vs. seller agency. Seems a bit deceptive.
MLS4Owners does not seem to pretend they are something they are not, in my experience anyway.
Looks like you are pretending to be a listing company, but the listings are simply the worm for your hook to solicit buyers. Based on what you are saying anyway.
“All the while the seller will be educated about our 75% credit to the buyer.”
Interesting. Yes, it is a business model that deserves a good look at.
Kary,
Clearly a new company can’t be based on past volume. If that were the case, any and all new ideas would be hindered.
Based on what I’m saying? Go to the website. In about 1 second if you do NOT know who we are targeting then I can’t help you.
Deceptive? Never! the feedback from our customers and consumers is always the same: Very positive. The negative always comes from the population.
We just opened in August 2007. Give us time. We have about 10 Agents with more on the way. Call our team “cohorts” but we are building alot of momentum. There will be many more companies like 500 Realty coming down the Pike in the coming decade but we all must start somewhere. I Thank MLS 4 Owners and Red Fin for help paving the way.
Change is good! Especially if it is for the common good! I gave up a 12 year job as an RN to bring about change in an industry that was long over due.
ooops…Too much multi-tasking………..The negative always comes from our ” fellow Realtors.”
Ardell, I didn’t say Craiglist was good for open houses. I’ve tried listing them there without any effect.
Also, it’s not the past volume thing. It’s the giving the impression that they are something they are not (a major player). I think a “We’re new, this is what we offer” approach would be a lot better.
Ray,
Calm down. We’re trying to give you a platform here. Seriously.
You said: “They target sellers we target buyers”
You started by saying you had the best listing service, then you flipped into not caring about the sellers as much as the buyers. If you are using sellers to get buyer calls so you can “target the buyers”, then it doesn’t seem quite fair to call yourself a “full service listing company”, which was your original claim.
Now you are saying you are not a full service listing company and are not even targeting sellers at all.
Sorry if we’re confused, but that seems to be your claim.
Ray,
You said, “A proper model ( I will not self promote) gives full representation with every listing be it 500.00…”
Now you say,”When you list you do NOT get:
*fliers (we email to seller the listing for the client to print and fill box)
*open houses ( we advise sellers to place a balloon on our sign and sit in their open house on Sundays- and yes post it on Craigs List)
*we do not pay for staging, or newspaper ads…”
I just wish people would be honest and be partially “do it yourself” companies. That would be largely popular and a more honest representation. I hate the word “discount”. Why not just be a Do It Yourself company with a lower cost for the part the buyers and sellers do on their own? Lots of people want that. Why pretend to be more than you are when it is not necessary?
Ardell ..We are what we are. Pretend? We do NOT need to. This is not even a point to argue. People Love looking for their home and now we are here.
I just wrote 31,000 in checks last week as credits back to Buyers. I’m sorry you are having trouble understanding what we do. Our customers speak volumes.
If you call looking for your OWN HOME do it your self. Then we are. But, we find everyone enjoys looking for their home.
To be honest Ardell I haven’t looked into what you do or any of the other people do here. If my tone is negative I apologize. But, I have respect for everyone in this profession for it will become far worse before it gets any better. Brace yourself.
You will be happy to know we are arriving in Seattle soon and many more offices in 2009-10. Our Model is just one of many to come. We will constantly change to improve our Model for the consumers.
Today we have added a nice young lady to step out on our website and explain what it is we do. Interactive Actor marketing I believe they call it. But, either way within a few years everyone will know there are options in Real Estate far different and better then the old Brick and Mortar.
Ray,
I’m not having trouble understanding what you do. You got into the discussion by saying you provided full service. Maybe we just don’t understand your definition of full service.
I think it’s a great business model. I don’t blame you for trying to get the word out, and have given you a lot of leeway with regard to advertising here.
It would probably be better if you took those credits off price if that was financed money. Handing people checks outside of closing is generally considered lender fraud if the property was fully or mostly financed. Taking $31,000 of money financed as “commission” that wasn’t commission, could be an issue. Banks don’t have a lot of tolerance these days for fooling them into paying a commission…that wasn’t commission, and not showing everything on the HUD 1. Just as easy to do it “on the sheet” most times. Try it.
I do believe your comments could have been presented in an on-topic manner. I expect it is simply your style to try to advertise anywhere you can.
So now that you have been kind enough to have an exchange with us, maybe you want to apologize to Tim for hijacking his post 🙂
Tim did ask “does it matter who you list with.” Your answer, I expect would be “YES! Just get in the mls and we’ll offer a big rebate to the buyer and that will help get your home sold faster than a traditional service.” And you are correct, it is a good option for some people. If you would talk TO us instead of AT us, like a commercial, all would be well.
I apologize for high jacking and I have never been called a troll. Now I’m getting to know the lingo. I most surely have been a troll at the Bubble and News Tribune.
BTW we are 100% within compliance and never “fool” the lenders. All our credits to the Buyer are stated clearly on the P & S addendum. Every transaction is its own entity and all subject to Lender Discretion. Most of the time the credit pays nearly all associated closing costs but in about 20% of the transactions the Buyer gets a check.
FYI
“According to long-standing interpretation, it does not violate Washington State’s laws governing the licensing of real estate brokers and real estate salespersons to rebate all or a portion of a real estate commission to an unlicensed principal(buyer, seller, lessor, lessee) in the transaction in which the commission is generated.”
“Accordingly, a licensee could advertise: “buy or sell through me and I will give you_____.”
“A rebate of all or part of the commission to the buyer by the company representing the buyer, or to the seller by the company representing the seller, would not require written consent of buyer, seller, or the lender.
Washington State Real Estate Regulatory and Enforcement Unit
Ray, I want a t-shirt. And,only then, will you be forgiven.
BTW- everyone, I’d like to retroactively introduce Mr. Ray Pepper, otherwise known as the most enthusiastic Broker to grace the electrons of Seattle Bubble and RCG. Everyone together….Hiiii Raaaaaay!
Just giving you a hard time Ray and you didn’t hijack the post, just added a bit of Pepper to it!
🙂
Ray,
I enjoyed our conversation and we both learned something new 🙂
Totally agree about WA and rebates and I do it all the time, as do many agents who don’t necessarily advertise as such. Though I’ve only done one with a 75% rebate in recent history.
If the lender won’t permit the full credit, and sometimes they don’t, we then take it off the price of the house.
The issue of the lender being fully informed has nothing to do with WA laws, but I understand there are a few States that do have Rebate issues. I think those will change in short order though.
Best of luck to you and your business.
We have always chosen our title and escrow people by the service that they provide but there are a variety of factors overall. It’s rare that I’ve chosen one purely by the rep alone but I will say that Ticor started getting my business after the listing agent called out their office in the contract and they did a good job and the rep then kept staying in communication with me regularly to ask for business and giving me excellent reasons WHY I should submit them as an option to my clients. What has been great in working with both Chicago Title and Ticor Title is that I’ve received excellent customer service from them both on a number of issues related to my clients over the years. We’ve handled a wide variety of problems and found ways around tricky situations that might otherwise have blown up a transaction for a client when they didn’t want it to.
As for escrow, we do the same thing here. We look for quality, price, and service. A good escrow agent will work with you in a transaction and they’ll answer questions for you on the fly sometimes before you even get to a contract situation. An example is as such: a client of mine bought a property a few years ago with the idea of short-platting, fixing up one house and building another. He’s already completed the short plat and fix up and sold the fixed up house. Now we’re on to the new construction piece and we had questions about whether, or how, a title transfer could be done (for liability reduction reasons) to move from private personal ownership to an LLC. One of my favorite escrow people was willing to provide some great information and resources to me and my client that helped him get what he needed and to learn the proper process and costs associated with the adjustment in ownership. End result – happy customer who will want to work with this escrow agent (and me) in the future.
Truly service minded professionals don’t think about only themselves when helping clients. They provide thoughtful advice, resources, and commentary so that people (the public) can make good decisions.
Thanks everyone! Tim the NEW shirts are coming you will love them. I still don’t think I’m a Troll like someone called me. I have a message to consumers thats relatively NEW, and very direct, but I don’t fit the Troll type definition.
Wikipedia defines it as irrelevant or off-topic. I personally feel I’m always on topic and never try to bait. But, I understand our message will continue to stir debate for at least another 5 years.
Beyond the obvious of engaging a good real estate practitioner, the choice of brokerage firm does impact the Time On Market (TOM).
If the price of properties account for different characteristics, then the TOM should be the same for all properties according to the market efficiency hypothesis. The test results only partially support this argument. The variables determined to be significant in the TOM model are insignificant in the price model and vice versa.
An accurately priced property has an initial list price that is +/-3% of the final sale price. The range of +/-3% probably accounts for the fact that real estate has qualitative characteristics that may be difficult to value. Interestingly, there is no impact on TOM from the initial list price/sale price ratio for low or high priced homes. Over pricing and under pricing does not influence the TOM. I suspect the low priced homes are seen as a generic product in a large supply. The list price doesnt necessarily signal the sellers reservation price. The high priced homes are limited in supply. They have many more unique characteristics.
For medium priced homes, accurately pricing the property from the start has an impact on TOM. The smaller the percentage difference between the initial list price and the final sale price impacts the TOM and selling within the average number of days on market. Overpricing medium priced homes can result in a buyer perception of stale or shelf worn listings. When finally priced correctly buyers ask “What’s wrong with it to sit on the market?” Such overpricing can result in a final sale price discounted more than 10% from the FMV. That is 7% points from the +/-3% range for property initially priced correctly. With the Time Value of Money, the longer TOM has as an economic oppurtunity cost.
Also, seasonality and brokerage firm choice impact the TOM. TOM is influenced by the season in which the property is listed for sale, the size of the brokerage and the number of listings.
Is it possible the large brokerage firms enjoy a competitive advantage from an economy of scale with general marketing and advertising cost? It seems plausible the large brokerage firms enjoy a cost advantage listing high priced homes and a large number of low priced homes. Strategic spending increases brand awareness.
Source: Yavas and Yang, Real Estate Economics, 1995.
Tim:
I thought it was appropriate to bring this back to my major beef with escrow…inflated and unneccesary reconveyance fees. (comments #29, 30 etc.)
Apparently some clever lawyer has decided to run with thisissue as well.
http://seattlepi.nwsource.com/local/363112_escrow15.html?source=mypi
Can you give us some insight into this?