Signing Agents in for a long Summer?

I had a very interesting call last week.   The call was from a “national” title insurance agency, operating in another part of Pennsylvania.  It’s the sort of operation that is licensed in multiple states, runs a boiler-room operation, and closes deals with notary signing agents.

Recently, while interviewing to fill an open position we spoke to several “refugees” from a local variant of this set-up. To answer interview questions, they went to great lengths to describe the work environment and operating practices.    It was an education in a part of the industry that no one seems to talk about.   And now I know why.

These operators (notice I didn’t say agents) exploit the reciprocal title licensing agreements between states to set up a high volume, low cost, high risk operation.  To keep costs down, they regularly cut corners in places most title insurance agents wouldn’t even consider.  Because errors in title and conveyancing can take years to be discovered, they can run some time before the music stops. 

Back to the call – the lender for a transaction insisted that any notary signing agent for carry $500,000 of E&O insurance.

Surprise – they couldn’t find any signing agents with that sort of coverage.  They asked if I would close the deal in my office and I’d receive the signing agent fee.  My “not interested” seemed to make the caller a little angry.

I have no intention of risking my license and reputation to further someone else’s shaky business model.  Don’t get sucked in by the lure of seemingly easy money.  If a deal ever came unwound, and many of these will, the powers that be will look for the licensee closest to the settlement table.

I’ve heard from E&O insurers that one of their greatest claim sources are operations using signing agents.  Could it be that lenders have figured it out as well? 

It could be a very long summer for the signing agents.

Integrity Counts

Back in March, John Corey asked a question on what to avoid in Real Estate Transactions.  Since his post,  I became increasingly conscious of my day-to-day interactions with others – the good, the bad and the ugly.

It reinforced what I’ve always believed.  Integrity counts.

People are amazingly consistent.  Good people usually behave well in all aspects of their lives, while the not-so-good ones tend to behave badly all the time.   Those who treat their employees, clients, and partners badly also seem to be the same ones that break, bend, or mutilate the rules. 

What is integrity? The link above provides the standard definition.  I’d like to borrow from Supreme Court Justice Potter Stewart’s famous quote – “I know it when I see it.”  But how do you find it?  When I build new relationships, here’s how I do it:

Rely on referrals.  If someone you trust recommends someone, then you are pointed in the right direction. 

See what they say publicly.   The Internet is a great tool to find out what people think and how they act.  Check out their web presence(s).  What does it say?  More importantly – what doesn’t it say?  Look for a clear articulation of values and a business philosophy similar to your own.

Look for a trail of satisfaction.  Do you hear good things about them from others in the industry and community?   Do clients and colleagues go the extra mile to say good things about them publicly? 

Observe how they treat others. Do they treat their employees well?  How do they treat their vendors?  Others?

The title business has evolved into two distinct business models – Client Focused and Transaction Focused.  The agency’s operating model can have a dramatic impact on your experience. I’ll follow up with another post that explains the service models and how they impact the client experience.