With the recent developments, including Chapter 11 bankruptcy, surrounding LandAmerica; I thought it would be important to share with you "who's who" locally.   Due to the bankruptcy, some lenders are not accepting title policies backed by LandAmerica.  If you are buying or selling a home right now, please check with your lender or real estate agent to make sure your title company is acceptable.

Our market has many different "brand names" of title insurance companies and actually just a few actual title underwriters.   Here's a quick run down of how the local companies currently stand (note: this will be changing as Fidelity National Financial is in the process of buying LandAmerica if the transaction is successful):

The LandAmerica Title Insurance (currently going through bankruptcy and being acquired by Fidelity National Financial).  Note: percentage of ownership is based on this report effective December 31, 2007.  Hat tip to Matt Carter.

Commonwealth of Puget Sound = LandAmerica's underwriter named Commonwealth with 50% stake in Commonwealth of Puget Sound.  Windermere, along with independent broker/owners have financial interests.

Rainier Title, LLC = LandAmerica's underwriter named Lawyers with a 25% stake in Rainier Title LLC.  John L. Scott and Coldwell Banker Bain have financial interests. (See Update 12/9/2008 below for changes).

Northpoint Title and Escrow = LandAmerica is the underwriter through Lawyers and reported a 40% stake in Northpoint.

Fidelity National Financial (in the process of merging LandAmerica's title division).

Fidelity Title and Escrow = Fidelity.

Chicago Title and Escrow = Fidelity.

Ticor Title and Escrow = Fidelity.

First American Title Insurance Company

First American Title and Escrow = First American.

The Talon Group Title and Escrow = First American.

Pacific Northwest Title = First American.

Stewart Title and Escrow = Stewart Title

Old Republic Title and Escrow = Old Republic

As I mentioned, this list is scheduled to change.  Fidelity National Title hopes to have the LandAmerica merger complete by the end of this year…Fidelity called the merger off in the ninth hour in a previous attempt.  Currently some major lenders, including Countrywide, Bank of America, Flagstar US Bank and Chase, have LandAmerica companies on their "non-approved vendors" list which may cause a hiccup with transactions that are in process.

I will keep you posted a this story develops.

Update 12/3/2008: Countrywide will accept LandAm policies stating that Fidelity Reinsurance Treaties are acceptable when your title commitment shows Commonwealth or Lawyers as the insurer.

Update 12/5/2008:  Provident Funding issues memo stating they "will not accept title policies underwritten or escrow services provided by a LandAmerica subsidiary…"

Update 12/8/2008: Flagstar Bank has issued a memo stating they will "require all title commitments, title policies and closing protections to be in the name of the new entities" for loans registered after December 1, 2008.   Flagstar's memo also states that Land America affiliated settlement agents (escrow) "who have not been associated with a closing disbursement with Flagstar since September 8, 2008 will "expired" from their closing agent database.

Update 12/9/2008:  Rainier Title, LLC has announced "we have become an authorized policy issueing agent for Stewart Guaranty Company".   (No mention in the email of Fidelity or their proposed merger).

My title and escrow partners at The Talon Group are at it once again.  This time, they’ve produced an entertaining video on how to read your title commitment.  Whenever you buy, sell or mortgage your home, odds are you receive a title commitment (aka title report).  It’s important to take a few moments to review what’s showing against your property.

This informative video from The Talon Group explains what happens with a reconveyance.  A reconveyance takes place when an existing deed of trust (aka mortgage) is being paid off.  Watch this short video to learn more.

The fine folks at The Talon Group answer a question on everyone’s mind: "what the heck is title insurance?" in this short video.

It’s good to understand what is covered with a title insurance policy.  Typically the seller pays for the buyer’s policy (Owners Policy) which assures the buyer of issues such as vesting (the seller is authorized to sell the property) and that the title is free and clear of liens.   The buyer generally pays for the lenders policy to assure the lender will be in first lien position (Lenders Policy).

Unlike other forms of insurance (auto, health, home, etc.), there are no renewal fees.  Title insurance actually covers you from the point of recording the new deed backwards into time.

Stay tuned for more videos from the cast and crew and The Talon Group.

If you have a common popular name, like Smith, Jones or Hernandez;  you may be asked to complete a form from the title insurance company.  This is so that instead of listing many judgments that are against the same name as yours on the preliminary title commitment, the Title Department and use the ID Affidavit to determine whether or not the items shown are against you.  Tim Daniels, Chief Title Officer with The Talon Group, explains more in this video.

<<Video Deleted>>

Sadly when First American absorbed The Talon Group, the deleted many of their education and entertaining videos.

Normally this wouldn’t be big news…but when Northpoint Title decided to drop their rates well below market and agressively try to pull existing title orders from other companies only to raise their rates one month later, I think it’s worthy some attention. Here’s an example of an email from a Northpoint rep to a real estate agent (dated June 16, 2008):

"Just checking in to see what you thought about the new title rates.  Can you believe we are 28% lower??  This is fantastic!   Here is a price comparison on an average sales price of $275,000:

Fidelity/Chicago: $840.00

FATCO/Talon: $840.00

OUR RATE:  $605.00

This is a big difference in the bottom line for your clients.  Let me know if you have any titles  you would like me to pull over.  I would be thrilled to help you out!"

Northpoint is a Landamerica "venture".  This email excludes the other local Landamerica title companies (which represent 25% of the total resale market in King County alone), Commonwealth of Puget Sound and Rainier Title who’s title rates (at the time) were 33% higher than Northpoint at this price point.

This tactic was used an attempt to gain title business on existing transactions without any regard to what was negotiated in the purchase and sale agreement.   Not to mention the effort or cost involved in producing the all ready provided title commitments. 

Northpoint justified their deep rate cut because they were a "green" title company, promoting being paperless which many title companies are (this is not unique).  From a separate Northpoint email dated June 16, 2008:

"I have some good news!  Northpoint’s paperless workflow system has effectively reduced our waste and costs, resulting in tremendous costs savings.  To help consumers in today’s challenging real estate market, we ahve decided to pass this savings on to your clients.  We filed new, lower rates with the Office of Insurance Commissioner and the rates became effective on Tuesday, June 10th…Please pass along this good news to your clients.  I look forward to working with you."

On July 7, 2008, Northpoint suddenly was not green anymore nor were they planning on passing any savings along to consumers.  Just shy of one month, they filed a rate increase following their huge marketing blitz all based on rate.  Presentations were being made to offices promoting the low rates even after the new higher rate was filed with the State.

Effective August 1, 2008, Northpoint’s rates are the same as Commonwealth of Puget Sound and Rainier Title.  They are 33% higher than what they’ve been pushing (and pulling) over the past month.   They are in line with the other title companies rates.

Title rates are not changed on a whim.   If you’re a long time reader of Mortgage Porter, you know that my background is title insurance and escrow and that my husband is in the title industry.   As a former manager, I can tell you that title rates are discussed and studied several weeks if not months.   Not to mention the time and effort it takes to file rates with the State.  (Washington title rates are public record, filed in Olympia).

In my twenty+ years in the real estate industry, I have never witnessed a title company use what appears to be bait and switch.