Archive for the ‘RESPA’ Category

Study: D.C. Metro homebuyers save big by shopping for title services

February 17, 2011 Leave a comment

Washington, D.C. (17 February 2011) – SHOPPING FOR TITLE SERVICES in the District of Columbia could save homebuyers up to $1,180, according to a recent study, while shopping in Maryland or Virginia could mean a savings of over $900.

“This serves as a reminder to homebuyers and their agents the importance of shopping for a title company,” said Todd Ewing, president of Federal Title & Escrow Company.

The study, commissioned by Federal Title and conducted by Veris Consulting from February 1 through February 11 of this year, compared title charges among Washington Metro Area-based title companies, revealing stark differences in charges for identical real estate purchase transactions.


· Only Washington Metro Area Title Companies that published a settlement fee and enhanced title insurance premiums for Owner’s and Lender’s Coverage.

· Purchase Price: $500,000.00

· Loan Amount: $400,000.00 (1st Mortgage Only – not including costs for simultaneous 2nd Mortgages)

· Type of Title Insurance: Enhanced Coverage (aka, Extended, Standard, Homeowners) Full Premium/Non-Reissue Rate

· Owner’s & Lender’s (Simultaneous Issue) Policies

· The “Total Title Charges” figure excludes Government Recording Costs & Recordation Taxes and Location Survey

It included only those title companies that published their settlement fees/charges and title insurance premiums for both owner’s and lender’s coverage – also known as title charges – on their respective website.

Further, the study used identical criteria for real estate purchases in the District of Columbia, Maryland and Virginia. In the District of Columbia, the difference between the most expensive and the least expensive title services was $1,180; in Maryland, the difference was $935; and in Virginia, the difference was $934.

“About 70% of variable closing costs paid by the average D.C. Metro Area homebuyer are title-related,” Ewing said. “Yet, very few homebuyers, or their agents, take the time to shop settlement companies to compare title charges.”

Title expenses such as settlement fees, title insurance and lender origination charges may vary among service providers, and these kinds of expenses are known as variable closing costs, Ewing said.

He added that comparing title charges among D.C. Metro Area settlement companies can be a daunting task for the untrained eye, which may explain why so few consumers take the time to research title companies.

The study also examined each title company’s Better Business Bureau rating to determine if there was any connection between higher title fees and ranking but found none.

Out of 25 companies, six had rankings and the only two that were accredited – Federal Title & Escrow Company and Express Title – were among the lowest and highest cost title service providers, respectively.

“The study suggests that higher fees do not equate to a higher BBB rating,” Ewing said. “To the contrary, Federal Title is one of the lowest cost title service providers and also has one of the highest Better Business [Bureau] ratings, proof that a title company can offer top-notch customer service at competitive prices,” he said.

While the study mostly focused on how shopping for title insurance services can amount to significant savings for homebuyers, fees charged to the home seller were also examined. Seller fees ranged from $393 to $736 and averaged around $500.

Below are the results of a study of rates published online by D.C. Metro Area title companies. Study criteria was the same across the board, and results are accurate as of February 11:


Company Name / Website Total Title Charges Seller Fees BBB Rating
Federal Title & Escrow Co. $3,190.00 [PDF] $495.00 [PDF] (A) A+
Counselor’s Title, LLC $3,265.00 [PDF] $443.00 [PDF] NA
Settlement Pros $3,580.00 [PDF] $438.50 [PDF] NR
Stewart Title $3,925.00 [PDF] not published NR
Pinnacle Title $4,084.99 [PDF] not published NA
National Settlement Services $4,089.99 [PDF] not published NA
District Title $4,090.00 [PDF] not published A+
Paragon Title $4,125.00 [PDF] $454.50 [PDF] B
Mid-Atlantic $4,130.00 [PDF] not published NA
Capitol Title $4,135.00 [PDF] not published A+
KVS Law Group $4,139.99 [PDF] $520.00 [PDF] NA
RGS Title $4,185.00 [PDF] $641.00 [PDF] NA
Express Title $4,339.99 [PDF] not published (A) A+
Avenue Settlements $4,370.00 [PDF] $468.75 [PDF] NA

(A) = Accredited | NR = Not rated | NA = Not listed


Company Name / Website Total Title Charges Seller Fees BBB Rating
Federal Title & Escrow Co. $2,300.00 [PDF] $495.00 [PDF] (A) A+
Counselor’s Title, LLC $2,375.00 [PDF] $443.00 [PDF] NA
Settlement Pros $2,755.00 [PDF] $410.00 [PDF] NR
Stewart Title $2,787.50 [PDF] not published NR
Paragon Title $2,870.00 [PDF] $454.50 [PDF] B
Olde Key Title $2,943.00 [PDF] $433.00 [PDF] NA
Mid-Atlantic $2,948.00 [PDF] not published NR
Capitol Title $3,045.00 [PDF] not published A+
Pinnacle Title $3,045.00 [PDF] not published NR
RGS Title $3,045.00 [PDF] $530.00 [PDF] NR
National Settlement Services $3,050.00 [PDF] not published NR
KVS Law Group $3,100.00 [PDF] $520.00 [PDF] NA
Village Settlements $3,149.00 [PDF] not published NR
Express Title $3,175.00 [PDF] not published (A) A+
Avenue Settlements $3,235.00 [PDF] $538.75 [PDF] NA

(A) = Accredited | NR = Not rated | NA = Not listed


Company Name / Website Total Title Charges Seller Fees BBB Rating
Lighthouse Title $2,321.00 [PDF] $570.00 [PDF] NR
Federal Title & Escrow Co. $2,380.00 [PDF] $495.00 [PDF] (A) A+
Counselor’s Title, LLC $2,455.00 [PDF] $443.00 [PDF] NA
New World Title $2,550.00 [PDF] $535.00 [PDF] NA
Dominion Title $2,595.00 [PDF] $470.00 [PDF] NA
All American Title $2,645.00 [PDF] $393.00 [PDF] NA
Settlement Pros $2,960.00 [PDF] $411.00 [PDF] NR
National Settlement Services $2,980.00 [PDF] not published NR
Republic Title $3,025.00 [PDF] $460.00 [PDF] NR
Key Title $3,029.00 [PDF] $624.00 [PDF] NR
Mid-Atlantic $3,060.00 [PDF] not published NR
Stewart Title $3,087.50 [PDF] not published NR
Capitol Title $3,125.00 [PDF] not published A+
Pinnacle Title $3,125.00 [PDF] not published NA
Global Title $3,175.00 [PDF] not published B
RGS Title $3,175.00 [PDF] $736.00 [PDF] NR
District Title $3,180.00 [PDF] not published A+
KVS Law Group $3,180.00 [PDF] $520.00 [PDF] NA
Avenue Settlements $3,235.00 [PDF] $418.75 [PDF] NA
Express Title $3,255.00 [PDF] not published (A) A+

(A) = Accredited | NR = Not rated | NA = Not listed



Categories: RESPA

Amendment to delay RESPA implementation withdrawn

October 23, 2009 Leave a comment

An amendment that would have required HUD’s secretary of housing to delay implementation of the new RESPA rule for at least six months was quietly dropped this week.

Federal Housing Commissioner David Stevens denied the request, saying the industry will have 14 months to prepare for the changes before they become mandatory.

Learn more

Congress passes amendment clarifying reach of CFPA

October 22, 2009 Leave a comment

The American Land Title Association applauded Congress’ passage of an amendment that clarifies the oversight of the Consumer Financial Protection Agency.

“Congress recognized that title insurance is best regulated by a comprehensive, well established state regulatory system,” ALTA CEO Kurt Pfotenhauer told Reuters.

Title insurance providers are still subject to federal regulation, however, in the form of the Real Estate Settlement Procedure Act. RESPA changes go into effect Jan. 1, 2010, and HUD has no plans to delay the implementation.

Learn more

Title Report highlights our ‘unique business model’

October 20, 2009 Leave a comment

With new legislation around the Real Estate Settlement Procedures Act slated to take effect Jan. 1, 2010, many in the industry have concerns about how these changes will impact their daily work routine. More accountability, full disclosures — the new RESPA rule has placed a lot of lenders in particular on the hook.

A few weeks back Todd Ewing spoke with The Title Report editor Jennifer Kovacs about Federal Title’s approach to the changes.

“There’s a hard push with the RESPA reforms toward what we’ve been doing all along, which is full disclosure. Mortgage lenders are not just going to expect it, they’re going to demand all title companies provide a guaranteed quote for their services,” Ewing said.

Below is the article in full:

Title company’s unique anti-AfBA business model pays off

About nine years ago, Federal Title & Escrow Co., which serves the Washington, D.C. metro market, decided it was time to quit a bad habit.

“We kicked the [affiliated business arrangement] joint venture addiction and replaced that relationship with a pro-consumer model that we now call the REAL Credit program,” Todd Ewing, Federal Title president, told The Title Report.

It was after about five years in business that the company put everything on the line for what felt right.

“If anyone is really honest about it, the affiliated business arrangements (AfBAs) are not consumer friendly, they’re just not. You got too many hands in the pie. So the consumer ends up losing,” Ewing said.

Federal Title’s REAL Credit program is simple: If title work is ordered through the company’s Web site, the consumer receives a credit that reduces the overall cost. Just like AfBAs, which caused the company to lose a good chunk of its revenue to the referral source, this program comes at a loss to Federal Title — but one not linked to a conflict of interest.

“Our REAL Credit represents in dollars what we used to pay over to our AfBA joint venture referral partners, only now we just pay it over to the homebuyer,” Ewing said. “I don’t want to be beholden to the interest of the referral source. I’d rather be beholden to the interest of the consumer. So we developed the concept, and it’s worked really well.”

The model
While not involved in any joint ventures, Federal Title does still rely on its referral sources. The company has a network of real estate agents and lenders who can also take advantage of the pro-consumer platform.

For example, when a real estate agent goes online to order services through Federal Title, an automated e-mail is sent to the homebuyers that tells them their agent just saved them $1,200 for ordering online, which then puts the agent in a great light.

“That goes a long way,” Ewing said.

In the first three years of the program, Federal Title saw a 50-percent increase in transaction volume and since has continued to grow its referral base.

“What happened is real estate agents realized that they wanted to extract themselves from that conflict of interest potential [with AfBAs]. And if they can look good and we can look good, then they’re going to come. And we’re obviously providing a cost-savings proposition to the homeowners,” Ewing said.

In fact, as word has spread about the credit, it’s not just industry partners who are referring business to Federal Title — consumers are discovering the company on their own.

Cost savings
Federal Title is able to stay above water and still offer the credit thanks to the increase in transaction volume that it’s seen over the years. However, the key to the program is that services must be ordered online.

The automated system is one that’s allowed Federal Title to see a significant savings.

The process starts with a transparent, instant online quote available from the company’s Web site. Federal Title was the first title company to provide the service in 2002, thanks to its proprietary software.

“A lot of our competition just couldn’t believe we were doing it. They were fearful. They were, like, ‘Why would you do that? Why would you guarantee that? You don’t know, things could change [from the quote].’ Well, we were willing to do it. Very few things change, frankly, and we ask the right questions,” Ewing said.

The user gets a guaranteed quote from the Web site on a modified HUD-1 form that shows the costs for title insurance, settlement fees, government recording charges, etc., Ewing said.

Then the person seeking the quote is able to order services online from there. Through asking detailed questions, Federal Title is able to limit its liability at the same time it cuts down on mistakes and automatically populates forms a title agent would normally need to process.

“All of that results in a cost-savings to us,” Ewing said.

Federal Title processes about 3,000 transactions a year, and the average savings to consumers through the REAL Credit program is $750. “It adds up, doesn’t it?” he said.

Federal Title has tried streamlining processes even further in the past, through outsourcing title work and surveys, but Ewing said the company has decided to bring all of its services back in-house and rely on its technology instead.

“None of it has really panned out for us. There’s nothing better than a home-grown title report. I don’t see that changing anytime soon,” he said.

Technological focus
Federal Title offers a variety of services, from deed transfers to a 1031 exchange to wills and estate planning, but Ewing said the majority of its business remains traditional real estate closings.

And while the bulk of that business is ordered online, Ewing said there’s always been some who would rather fax over the necessary forms. “We still have a few of those, but after nine years, given the changes in technology, I think people are adapting,” he said.

The industry, too, is adapting to the business model Federal Title has taken on, something Ewing said is apparent in the RESPA final rule and its goal of transparency in real estate closings.

“There’s a hard push with the RESPA reforms toward what we’ve been doing all along, which is full disclosure. Mortgage lenders are not just going to expect it, they’re going to demand all title companies provide a guaranteed quote for their services,” he said.

Ewing added that he expects lenders also to begin seeking instant, electronic quotes for title work that doesn’t throw off any specified tolerances, as dictated by the RESPA final rule and the Truth in Lending Act. “Who wants to call up and ask for numbers?” he said.

Federal Title also is using its technology platform as a vital part of its expansion efforts. The company recently partnered with a law firm in Coral Gables, Fla., to offer its expertise in marketing as well as technology to grow the company in that region. Federal Title is also seeking like-minded partners for opportunities on the East Coast, potentially in North and South Carolina and Georgia, Ewing said.

However, Federal Title is also using the technology arena to grow its footprint at home. The company is focused on developing its Web site’s blog to reach consumers who are technologically savvy and use the Internet to investigate the home buying process before jumping in.

“With the blogging atmosphere and everything that is available to the average consumer and the consumer’s appetite for that, we see a great opportunity not to be beholden to our traditional referral system. So that’s exciting for us,” Ewing said.

Issue Date: October 19, 2009
Questions/comments? E-mail Jennifer Kovacs at

Mortgage Lenders, Closing Agents Effected Most by New RESPA Rule

August 27, 2009 Leave a comment

CONTACT:  Nikki Smith                       
Main line:  202-362-1500
Direct line: 202-274-1517

Expert to dissect consumer disclosure, anti-kickback statute at upcoming Q&A session. Free event.

Washington, D.C. – Mortgage banking and consumer finance expert Holly Spencer Bunting will address controversy surrounding the reformed Real Estate Settlement Procedures Act during a presentation and Q&A session next month.

The new RESPA rule, which aims to connect the dots between estimated closing costs set forth in the good faith estimate and actual closing costs disclosed in the HUD-1 form, will mostly impact mortgage lenders and closing agents.

“The rule continues to stir controversy,” Bunting said.

While there’s hope the U.S. Department of Housing and Urban Development will delay implementation, settlement service providers are gearing up for Jan. 1, 2010 effective date, she added.

Mortgage lenders and real estate agents are encouraged to attend the free luncheon event, beginning at 10 a.m. Wednesday, September 16 at the Kenwood Golf & Country Club in Bethesda, Md., presented by Federal Title & Escrow Company.

“At its core, the Real Estate Settlement Procedures Act, is a consumer disclosure and anti-kickback statute intended to alert consumers about their settlement costs and to prohibit kickbacks that could increase mortgage costs,” said Todd Ewing, president of Federal Title.

Claims that fraud, deception and general consumer ignorance led to the disastrous outcome of the real estate lending bubble fueled the overhaul of the home buyer protection statute. Bunting will provide an in-depth overview of the components of HUD’s final RESPA rule and the new HUD-1 and GFE disclosure forms.

About the Holly Spencer Bunting:
Bunting is an associate with the Washington, D.C. office of K&L Gates. She represents companies in mortgage lending, title insurance and real estate industries in connection with regulatory compliance matters, according to her biography on the company’s website.

Her articles have appeared in a variety of publications including “The Review of Banking and Financial Services,” “Mortgage Banking and Consumer Credit Alert,” and “The Banking Law Journal.”

About Federal Title & Escrow Company:
In an industry contaminated by affiliated business arrangements, kickbacks and other referral incentives, the Internet returns the power to the people. Federal Title recognizes consumer-driven market pressures, as exemplified by the new RESPA rule, and seeks to offer home buyers substantial closing cost savings and a streamlined settlement process.

Federal Title has a reputation of being technically innovative and always at the forefront of the latest real estate trends. Years ago the company made a bold move by eschewing all Affiliated Business Arrangements and established its REAL Credit Program, which saves home buyers up to $2,000 on closing costs.

Now Playing: Closing Costs Explained Visually


New RESPA Rule FAQs – Good Faith Estimates

August 21, 2009 Leave a comment

1) Q: What happens if a GFE is not provided to a borrower?

A: In a transaction involving a federally related mortgage, the loan originator is required to provide a GFE to the borrower. Failure to provide a GFE as required is a violation of Section 5 of RESPA.

2) Q: When will the use of the new GFE and HUD-1 forms be required?
A: The new GFE and HUD-1 forms must be used as of January 1, 2010. The new GFE and HUD-1 forms may be used before this date. Please note that if a loan originator issues a GFE on the new form, then the settlement agent must use the new HUD-1 form and the tolerances and other requirements in the revised RESPA regulations will apply.

3) Q: If a GFE is issued on the old form prior to January 1, 2010, and the loan will close after January 1, 2010, which HUD-1 form is to be completed by the settlement agent?

A: If a GFE is issued on the old form prior to January 1, 2010, then the old HUD-1 form must be used even if closing will occur after January 1, 2010. For GFEs issued on the old form, the loan originator has the option to reissue the GFE (with the same terms and charges) on the new form, in which case the settlement agent must complete the new HUD-1 form.

4) Q: When does a loan originator have to issue a GFE?

A: A loan originator must issue a GFE no later than 3 business days after the loan originator receives an application or information sufficient to complete an application. Application is defined as the submission of a borrower‘s financial information in anticipation of a credit decision relating to a federally related mortgage loan, which shall include the following: (1) borrower‘s name, (2) borrower‘s monthly income; (3) borrower‘s social security number to obtain a credit report; (4) property address; (5) estimate of value of the property; (6) loan amount and (7) any other information deemed necessary by the loan originator.

5) Q: What is a loan originator?

A: “Loan originator” means a lender or a mortgage broker.

6) Q: What fees can a loan originator charge before issuing a GFE?

A: Prior to issuing a GFE, the loan originator may, at its option, collect a fee limited to the cost of a credit report.

7) Q: I am a mortgage broker. Can I provide the GFE?

A: Yes, a mortgage broker can provide the GFE, however the lender is ultimately responsible for ascertaining that the GFE was provided to the applicant.

8) Q: There are not enough lines on the GFE or the HUD-1 to show all of the charges that are appropriate for some of the categories. Where should these charges be listed?

A: Additional lines may be added to Blocks 3, 6 and 11 of the GFE. Additional lines may also be added to the HUD-1.

9) Q: Is a GFE a loan commitment?

A: No, the GFE is not a loan commitment. A GFE is an estimate of settlement charges a borrower is likely to incur to obtain a specific loan.

10) Q: At what point can a loan originator charge a loan applicant fees for services other than the cost of obtaining a credit report?

A: After a loan applicant both receives a GFE and indicates an intention to proceed with the loan covered by the GFE, the loan originator may collect fees beyond the cost of a credit report for origination-related services.

11) Q: If the borrower is taking out two loans to finance the purchase, how should the loan originator disclose the charges from each loan on the GFE and the HUD-1?

A: Each loan must have a separate GFE and a separate HUD-1. However, the principal amount of the second loan and a brief explanation of the second loan should be listed on Lines 204 – 209 of the HUD-1 for the first loan.

12) Q: What are processing and administrative services?

A: Processing and administrative services are those services required to perform the functions involved in title service and origination service. Processing and administrative services include, but are not limited to the following: document delivery, document preparation, copying, wiring, preparing endorsements, document handling and notarization.

*The preceding Q&A was originally published on the HUD website.

New RESPA Rule FAQs – General Information

August 19, 2009 Leave a comment

1) Q: When does the new RESPA Rule take effect?

A: The November 2008 RESPA Rule was effective January 16, 2009. Implementation of the provisions are as follows:

2) Q: When does the revised required use definition take effect?

A: The revised required use definition was withdrawn by a separate final rule published May 15, 2009.

3) Q: Can a loan originator e-mail a GFE to a borrower?

A: Yes; as long as the borrower consents and the other specific requirements for consumer disclosures under the Electronic Signatures in Global and National Commerce Act (ESIGN) are met, a loan originator may e-mail, fax, or send by other electronic means the GFE (and other RESPA disclosures, such as the HUD-1/1A). See section 101(c) of ESIGN, 15 U.S.C. 7001(c); also see 24 CFR 3500.23. The loan originator may also continue to deliver the GFE to the borrower by hand delivery or by placing it in the mail, as provided by RESPA.

4) Q: RESPA and HUD‘s RESPA regulations require that certain records be retained for a period of time. Can those records be retained electronically?

A: Yes, if the person responsible for retaining records under RESPA and HUD’s RESPA regulations meets the specific requirements and limitations applicable to the retention of electronic documents set out in the Electronic Signatures in Global and National Commerce Act (ESIGN), that person’s responsibility will be satisfied by the retention of electronic records. See sections 101(d) and (e) of ESIGN, 15 U.S.C. 7001(d) and (e); also see 24 CFR 3500.23.

5) Q: Can we translate the GFE and the HUD-1 into languages other than English?

A: Yes, it is permissible to translate the GFE and the HUD-1 as long as the form has been translated accurately.

*The preceding Q&A was originally published on the HUD website.