Rant,  Title Insurance

We’re good and we’re evil, which one will I be today?

We all know I spent a few years in the title industry.  Around 31 years to be exact, over a 33 year period of time.  I was out briefly in the early 80’s when the market crashed.  During that time I worked as a baker for Mrs. Fields.  That Mrs. Fields.  While the company originally taught me how to make cookies, I had the privilidge of the real Debbie Fields showing me how to make her cookies one day, years ago in Los Angeles.  I was out of the business in 2000 to a couple of weeks after 9/11.  The real 9/11.  I was commission only and just starting out when they flew the planes into the WTC.  When you’re commission only and they close the stock market, that’s not a great business plan.  Of course whenever I work for someone I learn way more than they want me to.  I’m always watching how things are done, how they get from Point A to Point B and then digesting all the information.

Like the day back in 2006 that they told me they could have the prelims created for $16 a day in India.  I knew what that meant to real title officers.  Like watching as title companies started being run like insurance companies.  The transformation from risk adversion to risk assumption.  The evolution of “quick” pres.  And all things that I hope, quite honestly end up bringing down one of the big firms.  It is not the product that the customer believes they are buying.  Plain and simple.  Their behavior is reprehensible.

But that’s not the point of today’s post.  Today’s post is about the deal from hell.  A simple purchase for a first time buyer.  A great gal who did not deserve to go through what the largest bank in the country put her through or what Old Repulsive put her through.

I love working with first time buyers.  As long as they listen to me and not their boneheaded friends I do great.  Sometimes I get tired of batting down their idiot friends.  This gal was awesome.   A big ol’ slice of awesome pie.  She’s young but not that young, she worked very hard and she was ready to buy a house.  She was well qualified in every way.  The prototype first time homebuyer.

I found her this amazing old house in Oakland that was an investor flip.  It has, amongst other things, an amazing deck out front from which you can sit at night and enjoy the view of San Francisco.  We made a nice offer and the seller accepted it.  We received back contracts signed by an LLC with a non-descript name inferring that it was for flipping properties.  As the selling agent, it is not my responsibility to check this entity or the signatures.  While I have those skills, it is not my place.

About a week later the preliminary reports came out in the name of a different LLC.  I noticed it and went to the page where the LLC information was called out.  Nothing untoward.  I clicked through to the LLC-1 (something not one other Realtor on the planet would have done) and didn’t see the signatory of my contract, but once again it was a non-descript name inferring that is was for investing.  It had the word “fund” in the title.  My assumption was that it was the equity investor in the project somehow.  I did not follow up.  Speaking of not following up, or more likely not doing their job at all, the Escrow Officer noticed that the contract was improperly executed and called the listing agent, her little buddy, and told him.  At no point did either of these knuckleheads tell me, the person who originated the contract.

After much crying and gnashing of teeth, the largest lending institution in the country is finally ready to release the documents on this transaction.  We are only 10 days late.  Two more days and a per diem is going to kick in.  We need one last signature from the Underwriting Department which is really the Underwater Department because they’re so far behind they could work straight through this holiday and still be five days behind.  This person notices a request for a Power of Attorney that has not been met and reiterates the request.  All along the bank has been asking the Escrow Officer for a Power of Attorney to connect the dots between the entity who executed the contracts and the entity who is the real seller.  Not once did this stupid bitch put it all together and say “Hey wait a minute, didn’t you guys redo the contract?”  The largest lending institution in the country slams on the brakes on everything and kicks my deal into the Fraud Department.  I guess because they didn’t have a Too Stupid to Live department.  When I finally hear about the issue, it’s from the bank.  I call and tear up the Escrow Assistant because naturally the EO is on vacation.  I race home and draw up a new contract and email it to my gal.   She signs within minutes and it ends up back at the seller.  Then I do what any good Realtor would do, I head to Pleasant Hill Wine Merchants.  I end up talking to their seller in the parking lot and they punch the documents back to me and I punch them over to the bank.  We were 10 days late and now we’re in the Fraud Department.  My Loan Officer has never been there before and has no idea what this all means.  My mortgage has now gone late and that’s what it means to me.

I write the Escrow Officer, her assistant, the branch manager and the Escrow Operations manager because I’m so pissed off.  They knew five days into this deal that the contract was improperly executed.  In fact it had been signed by the listing broker.  They failed to tell me.  The jackass Branch Manager responds and tells me that I SHOULD HAVE CAUGHT IT TOO!  I’m sitting there thinking what the hell is the matter with you?  I should have caught something on the seller’s side because I used to be a Title Officer?  Would you blame any other selling agent for this?  Seriously.  WHAT THE HELL IS THE MATTER WITH YOU PEOPLE!  I write back and say “You’re not really going to sit there and blame the selling agent for a mistake on the listing side are you?”  And goddammit apologize.  She never did.  I did get a snotty message from the Escrow Officer which pissed me off even more, but as it turns out at least she didn’t yell at me like she did at my Loan Officer.  While I’m not a fan of largest lending institution in the country, they saved her ignorant ass and she should be kissing their ass morning noon and night.  Suffice it to say that a company that I spent 15 years working for let me down in a big and mighty way.  And then blamed me for their screw up.  Their customer service was non-existent and that dumb bitch will never touch another deal that I am involved with.  I don’t care if there is a binder (which is why it was there in the first place) we will go to another branch and do the reissue there.

My buyer, you know, the greatest gal you’d ever want to be your buyer was supposed to move in that weekend and now the wheels of progress have come to a standstill.  A little added extra is the home she’s living in was sold to her boyfriend BY ME, a year ago.  Three days after documents were due the foundation work was scheduled to begin.  He’d spent months with the City of Berkeley getting all his permits in order, he was late starting the project and couldn’t really wait any longer due to weather.  As it turns out it was too late anyway.  The work starts and we labor away in the Fraud Department.  They quietly go through three days of a house without water as the Fraud Department sits around with their thumbs up their collective asses.  I call daily but nothing new.

Nineteen, yes, nineteen days later my deal finally emerges from the Fraud Department.  I shit you not.  Nineteen freaking days.  And then it goes back to the Underwriting Department.  My LO informs me that it’s a 72 hour turn around and she’s put an expedite on it.  I tell my gal hopefully by the weekend.  Then we go to docs and it’s over with.  Not so fast buckaroo.  The largest lending institution in the country doesn’t count so hot.  72 hours turned into 9 days.  I shit you not.  On the 9th day my gal loses her shit.  Completely.  I can’t even blame her so I let her.  Something I didn’t mention was that this gal is a pretty high powered individual.  Her mother was kind of a vagabound who relied on her next husband for providing for them.  They moved to whatever town the next man lived in.  Her mother never owned a house and never really did more than hold a job.  She was determined to make her life different.  You know how driven someone like that can be.  She can create testicular hamburger with a look.  And now she’d lost her shit on this deal.  Thankfully her choice was to get roaring drunk and tear up Berkeley.  After about an hour she lost interest in tearing up my cell phone.  The last coherent message I got from her was “I am going to micromanage this thing the rest of the way”.  Joy.

I chose to be proactive.  If I grind everyone’s eyeballs to powder before she gets to me I can report that whatever she wants me to do is already done.  I start in on the Loan Officer first thing in the morning.  I know none of this is her fault but it’s my belief that she’s been too nice and no one is taking her seriously.  I lay it out.  She gets a little bent out of shape but mostly because I know she likes me and doesn’t like getting squeezed by someone she really likes.  I reiterate that I think she’s great but her back office is the shits.  And continue to push.  She actually chooses a root canal over dealing with me any more that day.  Except she gets to the chair and is so upset she can’t sit there and has to return for more grinding from me.  Then low and behold, documents.  I push some more and presto!  A signer appears and she executes the documents.  I push a little more and we closed on the day we needed to.  We got confirmation as the moving truck was leaving her place in the City.  That’s a lot closer than I like to cut it, but I had no choice on this one.  I met them at the house as they arrived with the moving truck.  She was walking 10 feet above the ground.  “I can’t believe they let me have this house, I’ve never lived in a house before.”  Yeah babe, you earned this one.


  • OldTitleGuy

    First, how did you get a picture of my office?

    Second, if anything good is to be wrung from this, it’s the lessons to all concerning validation of authority. There are roughly a gazillion forged documents out there purportedly executed by major banks and trustees that have been falsified, so us evil title guys tend to be a little anal about signatures.

    Sometimes folks, with the best of intent, take shortcuts that jump up and bite later. Seems to be, in part, what happened here. Contract signed by the listing broker for the selling LLC? Lender calling for a power of attorney to validate that? Did they call for a resolution by the LLC authorizing the power of attorney? That power of attorney would have to be executed by the LLC, not by an individual in charge of the LLC. Not the approach that I would take, but then it isn’t my money. I do sorta wonder who signed the deed and escrow instructions, and under what authority.

    It’s a fun business.

  • lidarose

    News such as this blog makes the hair on the back of my neck stand on end and gives me a headache. There are so many incompetant, and just plain dishonest people working in the lending industry…and the real estate industry (sorry to say). I’m so glad that you were finally able to put it all together. Too bad you have to play “bad cop” to do get the job done. You are a true professional..I’m glad your buyer is happy and in her first and new home. Happy Thanksgiving!!!

  • Wine Dog

    Yeah, this one was ugly. Contract comes in with one name, prelim comes out with another. I think y’all still call that a red flag. I clicked through to the LLC-1 which of course is only moderately helpful. It had another guy’s name on it, but my line of thinking was there was a missing piece. EO dropped the ball mightily. Listing agent runs numerous LLC’s, she knows that, it was a pretty simple error back in the first week of September. I can’t blame the largest bank in the country for kicking it to the Fraud Department. At that point in the transaction, from their point of view, I’m sure that’s what it looked like. In the end, the real manager for the LLC that owned the property re-executed the contracts, escrow papers and signed the deed. I made sure of that. And yeah, POA? Seriously? I don’t know about you but I rarely saw an LLC with a POA for anyone. And I did billion dollar transactions with multiple layers of entities.

  • Skip-itty-doodah

    Not to chime in sideways but we are seeing so much “old” creativity. Welcome to the nineteen eighties again. Bad market so therefore creativity. I’m seeing parents added to co-sign again, seller carry-backs and joint protection CLTA policies? what next equity sharing? And yes I was even asked about a POA on an LLC? I’m seeing more Deeds in Lieu, yes A LIEU-Y LIEU-Y, OH OH WE GOTTA GO NOW! But the biggest issue I’m seeing lately is BAD trustee work..creating BAD foreclosures…and all the auction companies think WTF? why can’t you just close the deal…which MFer got us into this trouble in the first place!..whew I feel better now..but my butt still hurts from having Alliance as a cell mate! by the way where is John H.? Vegas?…1,2,3 kick, 1,2,3, kick!..Show Girls 2 here he comes!

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