USEFUL INFORMATION
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J. Randolph Given
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MARKETING MYTH: THE ADVANTAGES OF ONE STOP
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For several years it seems like everyone involved in the real estate industry
has been selling all of the services connected with a residential transaction.
Real estate brokers, attorneys and lenders all sell title insurance. Some
brokers also sell mortgages. It seems like each of these industries wants
to compete with each of the others. In particular, real estate brokers
have promoted their other services as being convenient "one-stop shopping." Competition promotes efficiency and lower prices. One stop shopping may or may not promote competition. It may or may not be beneficial to Seller of to Buyer. Consider whether or not it does in your specific deal. Real estate brokers usually encounter both Sellers and Buyers earlier in the transaction than either loan officers, title insurance companies or attorneys. For years they have been promoting "one stop shopping," offering mortgages and title insurance. In Illinois, they may not legally offer legal services, although some have tried. The brokers usually get to make their sales pitch to the customer earliest in the Transaction. In my experience, a lot of the mortgage lenders affiliated with brokers have provided good service. They are motivated to do so. Their referral sources need to close in order get paid. I am not sure whether their product is always the best price. It is worth a Buyer's time to shop the mortgage. Brokers who I have known to be affiliated with a mortgage company, usually have an exclusive arrangement with one company. RETURN TO: Useful News Index RETURN TO: Web Site COPYRIGHT 2007 |
I also have noticed that real estate brokers who act as agents for title
insurance companies also tend to have an exclusive arrangement with
one title company. Since the State of Illinois began to regulate
title insurers in the 1980's, I have noticed that the rates of reputable
title insurers vary in a fairly narrow range. The quality of service,
however can be widely variable from one company to another and, within
a given company, from one county to another. It can be worthwhile to
shop for title insurance too. In order to economically serve clients in residential transactions, most attorneys have found it necessary to become agents for title insurance companies too. In my office, I have tried to solve the problem of variable service among companies by becoming a non-exclusive agent for four title companies, including: TICOR Title Insurance, First American Title Insurance Company, Lawyers Title/LandAmerica, and Professional National Title Network, Inc. I have noticed that many of my colleagues also act as agents for multiple companies. It is a luxury to be able to recommend to my clients the company whose services, in my opinion, offer the best fit to the needs of our transaction without worrying about losing the title business to do so. I hope and believe that it often enables me to better serve my clients. It seems like more attorneys are agents for multiple companies these days. Sellers may want to consider this before too quickly giving the title insurance business to their real estate brokers. NOTHING CONTAINED IN THIS ARTICLE IS LEGAL ADVICE: IMPORTANT DISCLAIMER |