Settlement Nightmares!!!

Come on let’s take a break doing what we LOVE and share our experiences. One of my favorite and unforgettable incident in my 18 years in the industry occurred in late 2009….After telling my story you’ll find out why this incident (after many years) is still fresh in my mind….in details!

Listing Agent (LA) was extremely frustrated with the Loan Officer (LO) and the Selling Agent (SA) for holding up the settlement for hours because they won’t comply with the buyer’s (usual) demand on a (typical) situation. “GIVE ME A CREDIT FOR THESE CHARGES THAT I WAS NOT AWARE OF!” May I briefly mention the buyer’s party arrived the settlement 2 hours late! Both the SA and LO got on their cell phones as soon as the buyers voiced out their demand (who knows who they’re calling at 8:30pm) and refused to come back in the settlement room until……..whatever they were waiting for! Listing Agent stepped out of the settlement room to speak to both SA and LO in several occasions and asked them to resolve their situation as soon as they could and to get back in the settlement room. Seller waits quietly. Listing Agent, finally frustrated, threatened to walk out with his seller and place the other parties in breached of contract as the buyers stand strong not to sign any papers unless someone cover the discrepancy. Buyers was upset with the seller’s attempt to walk and said it wasn’t their fault that they found charges that were not disclosed to them. Listing Agent ignored the buyer’s frustration and continuously screamed at the SA and LO asking for someone step up to find solution to their situation. I waived my settlement fee of $195 to help with the situation and show my client (the Loan Officer) consideration. Still short of credit demanded by the buyers – NO ONE ELSE offered to help. In fact, the LO advised the buyers not to purchase an owner’s policy to lower the cash from borrower with a comment “You can remove it! The lender doesn’t care and it’s not required by law”. Of course after I explained the risk – buyers refused. LO pulled me out of the settlement room and said I should have been on his side and threatened to pull out all his files in process with our Company. Why? Because I educated the buyer of the risks involved for not purchasing an owner’s policy. I stayed calm and in a professional tone and manner stated “I apologize Mr. __, although you are the source of this business; we (title/escrow companies) are a neutral party. By law, we can only represent the real estate transaction and not ANY of the individuals involved”. Still looking very frustrated with me, he walked back in the settlement room and I followed.

This is how my nightmare began. It started with loud argument between the LA, SA, LO and the buyers (all at the same time). Unimaginable name calling and foul languages (some I never knew exist), endless threats AND THEN…..pens, papers, coffee cup and CHAIR flying across the room. The cup thrown by the Listing Agent accidentally hit one of the buyer on the forehead (and NO…sorry we don’t serve paper cups). Buyer/husband called the cops and threatened to sue the listing agent for physical injury. I grabbed the medical kit to stop the bleeding on his wife’s forehead (it was a small cut but it was bleeding). After the husband’s phone call to the cops, he flew across the table and punches the Listing Agent on the face and missed. The listing agent & the seller tried to calm down the buyer and asked not to proceed to file a complaint against the LA. The buyer asked the seller. “What’s your concern? You didn’t do anything”. After many hours and with all the commotions that happened, seller finally speaks: Well he’s my brother of course I care what happens to him…..Seller was a widow using her husband’s last name (who would have thought!). After someone getting hurt, I figured everything will stop. Hmmmm no disclosures found stating the relationship between the seller and her agent, SA opened up another topic of argument. I was just glad that the cops finally arrived.

Here is the cherry on top of my “sundae” (as in my SUNDAY settlement). Home is being purchased/sold for almost $400K. If you know the business, you do the math on how much in commission the agents and the loan officer could possibly receive. The credit that the buyer was demanding for? The 2^nd appraisal fee appearing on the HUD-1 for $350 and the SA’s admin fee of $195 (which I basically covered by waiving my settlement fee). $350 dollars my friends!!! So after they settled their business WITH the cops……still calm, I locked up and got in my car and head home. I arrive very early to work the next morning and my boss asked me how the settlement went last night. It was then I realized when you love and enjoy what you do, you tend to ignore the bad events that comes with it….as if it’s always been part of your job and it is your responsibility to act professionally no matter what and never lose your temper. I’ve spoken to my husband when I got home that evening and again when I woke up the next. Even chat with a few staff when I arrived at work but only told the story to my Boss – only because he asked. I told him that the file didn’t close and my opening statement to start the story was “About the missing coffee mug………”

I think RESPA felt the pain of this incident that day. A few months later, I’ve learned the new 2010 GFE Compliance (Cure and Tolerance)!!! Oh in defense to all the parties involved they all apologized to me the second time around I had to do that settlement. I did receive new cases from the LO AND received a few contracts from the selling agent. Yes, they both demanded that I do their settlements for each and every closing they have with us!

SURE it was my pleasure to comply to their request. What’s the worst that could happen next time? Thanks for listening guys! Now tell me your story…..

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