Who Should Define What Is Superior Customer Service? The Client or the Texas Title Company?

99.9% of every Texas title company makes the declaration “customer service is what we are best at!” And maybe that particular title company is good at what they define as customer service in the world of Texas title insurance and real estate closing services. But if the title company’s definition of customer service does not match your definition of customer service, more than likely, you will disagree with their statement of superior customer service and think the opposite. A Texas title company’s definition of customer service may not be the customer service you are looking for. Superior customer service is not a universal standard, but based on each customer’s expectations.

Here’s the challenge: The Texas title company that you have selected defines “superior customer service” as making sure your loan closes and funds on time. The title company has all of the information and is in contact with the lender. The escrow officer knows she has enough information to close and fund this loan. In the escrow officer’s mind, she is thinking, “Snap, I’m good!” BUT your definition of “superior customer service” from a Texas title company is different: You also want constant communication with all parties, making sure everyone is on the same page, confirmation of deadlines, etc. Your mind is filled with, “Is this going to close? Has anyone contacted MY client to confirm the closing time and location? Why can I not reach my escrow officer?” And you want someone to allay those fears.

In the above example, is it an untrue statement that the Texas title company has performed with “superior customer service”? No, not necessarily. It simply reveals you or your team’s customer service needs require a different type of customer service to provide a level of confidence and comfort you and your team are looking for. That’s why Griffin Law Firm knows and believes the importance of communicating with our clients from the very beginning. Knowing and organizing a client’s future expectations makes for a fruitful and lasting relationship for both Griffin Law Firm and you, our client.

At Griffin Law Firm, we don’t claim to our clients we have “superior customer service.” However, we do provide a service based on you and your team’s needs. We recognize there is not a cookie-cutter solution for all clients. Thus, we provide a customized, organized, customer service defined by your standards.

What Is The Ideal Texas Title Company?

The following story reminds me of a “priest, rabbi and a minister” joke, but it is a true story about Texas title companies and how they differentiate their very commoditized products and services nonetheless. However, it shed new light on what the ideal Texas title company does or should be doing for its clients within the highly regulated framework created by the Texas Department of Insurance.

A mortgage company is having their weekly meeting in which they invite current and prospective vendors in to solicit the mortgage company’s business. On this occasion, three Texas title company representatives are there to try to earn the mortgage company’s business for their respective title company. When the first Texas title company representative has the opportunity to give his spiel, he states, “The price of Texas title insurance is fixed by the Department of Insurance, so the bulk of the fees charged by all Texas title companies is the same generally, so the way we differentiate our title company is in our customer service”. The second Texas title company representative has his chance next, and asserts, “The first Texas title company representative is correct in what he says that there are very little differences in what Texas title companies charge, and so customer service is what sets us apart. And that is why our title company’s customer service is second to none”. It was now the third Texas title company representative’s turn to give his pitch. The loan officers are waiting for him to say something—anything—interesting and different from what the first two said. Instead, the third Texas title company representative says, “The first two Texas title company representatives have said it best. I have nothing further to add”.

In my head, this story is comical, but the reality. I actually agree with all three Texas title company representatives that it all comes down to customer service: they are all correct. But how are mortgage and real estate professionals supposed to see the difference between Texas title companies and their varying degrees of “good customer service”? I ask myself this question constantly because differentiation is always important when clients have a choice in who they use.

At Griffin Law Firm, which is a fee office for a major Texas title company, we know we haven’t thought of everything and every tool we can be providing for our clients. There will always be more ideas to come. We also know that the ability to fulfill the needs of our clients comes from engaging with them and building strong relationships with them in order to know what voids could be filled. That being said, we have some very clear ideas of what sets us apart from other Texas title companies that goes beyond the usual dog and pony show. This may not be the silver bullet that meets all your needs, but I believe it gives us a good foundation from which to start. We are always willing to listen and always asking why. We want to be the Texas title company that is on your team.

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Happy Thanksgiving from Your Texas Title Company!

I know that with all the hustle and bustle of the new RESPA rules, end of month, end of year coming things can be rushed and everyone seems to focus on the subject at hand, which is to get as many loans closed as possible by the end of the month; be prepared for the New Year RESPA Rules (so you can continue without slowing your closing pace); and somewhere in between try to make a few bucks.

Okay, now it’s time to breathe. All of the matters at hand are important, and I realize there are dead lines in all situations, but there is something even more important coming your way—and that is Thanksgiving. I know we are all thankful for our jobs, especially in this market. But how about that son or daughter that tugs on your pants while he or she looks up to you? Or how about the wife that waits patiently while you work the long hours to make sure they are cared for adequately? Or how about the brothers, sisters, mom and dads that you haven’t really had time to see because of all the time restraints and challenges with your career?

I would like to challenge you to set aside some time, maybe a day or two to reflect on what REALLY matters in life. Then once you have decided, tell someone how much you love them, why you are thankful and how thankful you are that they are part of your life.

In this day and time, love can be lost in translation.

Make this Thanksgiving true and sincere.

Happy Thanksgiving from all of us at Griffin Law Firm!

RESPA's Changed Circumstances: A Texas Title Company That Can Help Get You Through It

Effective January 1, 2010 RESPA states that once the Good Faith Estimate has been disclosed to your client, it’s pretty much written in stone. But what if something does need to be changed? There are certain circumstances that you may change the numbers on your GFE.

If the following occurs, you may change your GFE:

1. Acts of God, war, disaster, or other emergency.
2. Info particular to the borrower or transaction that was relied on in providing the GFE and that changes or is found to be inaccurate after the GFE has been provided, which information may include information about the credit quality of the borrower, the amount of loan, the estimated value of the property, or any other information that was used in providing the GFE.
3. New information particular to the borrower or transaction that was not relied on in providing the GFE.
4. Other circumstances that are particular to the borrower or transaction, including boundary disputes, the need for flood insurance, or environmental problems.

In addition to these rules, RESPA goes further to say:

None of the information collected by the loan originator prior to issuing the GFE may later become the basis for a “changed circumstance” upon which a loan originator may offer a revised GFE unless the loan originator can demonstrate that there was a change in the particular information or that it was inaccurate, or that the loan originator did not rely on that particular information in issuing the GFE.

In addition, the loan originator is presumed to have relied on the borrower’s name, the borrower’s monthly income, the property address, an estimate of the value of the property, the mortgage loan amount sought, and any information contained in any credit report obtained by the loan originator before providing the GFE. The loan originator cannot base a revision of the GFE on this information unless it changed or is later found to be inaccurate.

GOOD RULE OF THUMB: GET IT RIGHT THE FIRST TIME!!

We are a Texas title company that will help you get it right the first time. Use our Texas Title Insurance Premium Calculator to determine your title fees to the penny. So many times, mortgage lenders and mortgage brokers leave money on the table when filling out their GFE because they did not include the credit the Texas title company has to deduct from the basic Texas title insurance premium. Check it out!

How to Avoid Loan Closing Delays Because Of Inaccurate GFE Charges Under the New RESPA

If you are worried that getting your borrower’s Good Faith Estimate may be a near impossibility when first starting the loan process and when you don’t know all the third-party service provider’s fees, HUD allows loan originators another method that may relieve some of the guessing. Loan originators may use average charges for those third party service charges that are not based on your borrower’s property value or loan amount. HUD cites the following list of nonexclusive service charges as permissible: appraisals, credit reports, flood certificates, tax service, and recording documents. However, HUD specifically states the average charge method cannot be used for transfer taxes, interest charges, escrow reserves and insurances (including your Texas title company’s title insurance).

However, if you are going to use the average charge method, HUD requires the loan originator to document how you arrived at such average charge. A loan originator must keep documentation showing how it calculated an average charge for at least three years after any settlement for which that average charge was used.

In order to calculate an average charge, the loan originator must "define a specific class of transactions for a specific time period (not less than 30 calendar days, nor more than 6 months), for a specific geographical area, and for a specific loan type. The average charge is based on a calculation of the average amount paid for the settlement service for the particular class of transaction. HUD does not prescribe a particular method for calculating the average charge, but it must be determined in such a way that the total amounts paid by borrowers and sellers through use of an average charge will not exceed the total amounts paid to the applicable settlement service providers in the particular class of transactions." See New RESPA Rule FAQs at http://bit.ly/msSSY, p. 28-29.

What if the loan originator overcharges the borrower or seller too much when using the average charge method? Does the loan originator have to refund the borrower or seller the excess amount? The answer is no, but…the loan originator cannot retain the excess. Instead, the excess should be applied to the next average charge period, so that the next class of borrowers or sellers receive a discount on their charges that use the average charge method.

So the loan originator can use the average charge method to alleviate the guesswork in knowing the third-party service provider’s charges, so the loan originator may avoid hang-ups that would delay a closing. However, if the loan originator uses the average charge method, it best be ready to substantiate the average costs determined to their regulators.

Does your Texas Title Commitment Insure Mineral Rights?

As of this year, a rule was passed allowing Texas title insurance companies to insure mineral rights on a residential property. The insurance comes in the form of a blanket policy and certain criteria must be met before issuing the T-19.2 aka Minerals and Surface Damage Endorsement.

Note that this is not an endorsement that will be automatically issued. In order for the owner or lender of the property to be insured, the endorsement will need to be requested directly with the Texas title company insuring the transaction.

There is still some uncertainty as to the pricing of the T-19.2 and if credits such as the R-8 refinance credit, apply, but the Texas Department of Insurance presumably will clear this up in the next few weeks.

For timing’s sake, it will be important to notify your Texas title company if this endorsement is going to be requested as soon as possible. Mineral right researches require more work than a normal title search and, thus, much more time. Some mineral right researches can take weeks depending on issues such as how far back the deed was taken out, were the minerals ever severed from the surface, were there any deaths, were the rights transferred, etc.? And once the research is completed, the information gathered concerning the mineral rights being insured by your Texas title policy will need to be reviewed by the appropriate underwriter or attorney. Only upon their approval will the endorsement be issued.

The point I’m trying to drill into your rock is there will be many steps to obtaining this endorsement and may require time. If you need this endorsement or you think you may need it, request it up front from your Texas title company to save your closing from being prolonged.

This new endorsement may not be a big deal in the Houston area where typically, residential owners do not own the minerals to their property. However, in areas like the Dallas-Forth Worth metroplex, it is quite common for residential owners to still retain the minerals to their property. It is worth taking the time to ask your borrower if they would like this endorsement to show them you are the smartest mortgage specialist in the room.

Need a Texas Real Estate Contract?

It’s 5:00 pm…30 minutes until you leave your work life behind—if you are that disciplined….and some of us aren’t. The phone rings, and it is your FSBO borrower wondering if you know how to set up a seller lease-back or have some sort of “Seller’s Temporary Residential Lease” form. Not a very common request for most, and I know your first thought is, “I will call the title company and see if they have one.”

Did you know the Texas Real Estate Commission publishes all the forms they give to real estate agents? If you or your client really need a real estate contract, go to:

http://www.trec.state.tx.us/formslawscontracts/forms/forms-contracts.asp

Cut the middle man out! Save time! Now, go home!