Checking up on Title Firms

Whether you are a home buyer or seller involved in a real estate transaction, or a real estate professional looking out for your client's best interests - there are some important facts about title insurance and title companies that you need to be aware of.

Some of the key items to look out for:

1. Re-issue Rate.

If title insurance is to be issued then under certain circumstances the title company is supposed to charge the reissue rate, which is significantly lower than the regular premium ($3.30/$3.00 per $1,000 vs. $5.75/$5.00, i.e. a 40-45% savings!)

The reissue rate is supposed to be charged in a sales transaction if the prior owner's title policy is less than 3 years old, and on re-fi transaction if there is a prior policy, regardless of how old the prior policy is. (note: one re-fi's the reissue credit will only apply to the coverage amount of the original policy, any additional coverage due to appreciation and higher loan amount will be charged at the regular rate).

Make sure that you provide a copy of the existing title insurance policy to the closing agent and request the reissue rate where applicable.

2. Misc overcharges

Title companies routinely like to charge $50 or even $75 for 'courier fees'. By law, the title company can only charge/pass on their actual cost. Request that the title company provide proof of actual charges along with a refund of any overage. If you put the title company on notice then odds are they will be willing to charge a much more reasonable fee, say $20-25 for their fedex charges.

3. Timely Commitment

Almost all real estate contracts specify that as a condition a title commitment (which will spell out any exceptions to title, i.e. problems) must be provided to the buyer prior to closing, with the buyer having several days to examine the commitment. In reality often title companies do not provide a commitment prior to closing, many times a commitment is not even provided to the buyer at the closing table. Always request from the title company that a title commitment is provided at a minimum 2 weeks prior to closing.

4. Title Policies

Many times home buyers never receive the actual title policy for their property. Many title companies - especially during the boom times of the past two years - simply never got around to sending them out. This of course can present a problem if a title claim arises in the future, or if a title policy needs to be furnished in order to obtain the reissue rate on a sale or re-fi. Make sure you request a copy of the title insurance policy in writing if you have not received it within 2 weeks of the closing.


Most title companies are excellent in the work they do, however there are some bad apples in every bunch and being aware of the points mentioned above can easily save you or your client a few hundred dollars, plus eliminate problems down the road.

Sellers adjust to new reality

(Article published Jul 26, 2006 in Sarasota Herald Tribune, reproduced with permission)

Charlotte home prices rebound a bit in June; Sarasota sees the first price drop in six years.

By STEPHEN FRATER and MICHAEL POLLICK

stephen.frater@heraldtribune.com
michael.pollick@heraldtribune.com

After months of flattening out, home prices in the Sarasota-Bradenton market dropped during June, a sure sign that sellers have recognized the new reality of a cooler market.

The median sales price in June was $326,800, down 3 percent from $336,800 a year ago, the Florida Association of Realtors reported on Tuesday.

It was the first drop in prices in six years.

Last month, prices in Charlotte County-North Port had dropped 2 percent, but the market rebounded in June, with the price at $222,300, up 3 percent.

Cutting prices, a familiar strategy these days among the Detroit car makers, seems to be one of the big tricks to moving homes, too.

It can just take a while.

After three months of open houses and price cuts, James Good of Good Choice Realty finally landed a buyer for his listing at 2921 Stoneland Lane in Sarasota. The sellers paid $165,000 for the place last year, then pumped some money into improvements.

"We started out at $229,000," Good said. "Every time you change the price it would show up on the hot sheets. But nowadays there are so many price reductions in the hot sheets that it doesn't matter as much."

"The minute we priced it below $200,000 it went pretty quick. It sold in a week or two."

"Listings from $350,000 to $800,000 are just dead."

Sitting at the midway point of 2006, things look eerily familiar to its beginning: Sales were down 48 percent in January. Sales were down 40 percent last month. Sales were down 41.5 percent for the first six months of the year.

The phenomenon, though less pronounced, is the same in Charlotte County-North Port: sales down 18 percent in January; 34 percent last month; and 25.4 percent for the first six months of 2006.

Meanwhile, Sarasota-Bradenton's condominium market is holding up better than single-family, with 1,952 units moving so far in 2006 compared with 2,720 during the first six months of 2005, a 28.24 percent drop.

In Charlotte County, it was much more dismal, with only 27 units moving so far this year compared with 463 in 2005. But what is moving is clearly high-end -- prices rocketed from a median of $184,300 a year ago to $350,000 last month. By comparison, condos in Sarasota-Bradenton were up 11 percent to $287,500.

The real estate situation in Southwest Florida is mirrored across the Sunshine State.

So far in 2006, 98,396 homes have changed hands, off nearly 25 percent from a year ago. Then last month, all of the state's 22 largest markets saw drops -- the highest at 48 percent in Naples; the lowest at 7 percent in Tallahassee.

The biggest price drop was in Panama City at 10 percent. Close behind was Naples -- a city often compared with the local market -- down 8 percent, from $491,400 to $451,500.

Besides Sarasota-Bradenton, Naples and Panama City, price declines occurred in Fort Walton Beach (a drop of 6 percent), Fort Myers-Cape Coral (5 percent), Melbourne-Titusville-Palm Bay (2 percent) and Fort Pierce-Port St. Lucie (1 percent).

The statewide median sales price last month was $257,800, up modestly -- 3 percent -- from a year ago.

Just about every seller is struggling with price.

Nearly two years after he bought a west-of-the-Trail house in north Sarasota as a speculative investment, Steve Judd has become a don't-wanter.

"I really don't want to wait," said Judd, explaining that he has since purchased an industrial property that he wants to develop.

"So I need the funds to get going on that one."

He spent $100,000 renovating the house at 1009 23rd St. in Sarasota, adding landscaping, upgrading bathrooms and flooring, building a wrap-around deck and refinishing the kitchen.

Judd recently reduced the price to $390,000 from the original $460,000. The home was listed at that higher price for nine months starting in May 2005. Judd got some offers, but most, including the one he accepted at the time, were contingent on the buyer selling another place.

"Where I goofed is I took a deposit that was contingent, and it tied the property up for about five months."

Judd isn't the only one who wants to move on.

Susan Murphy-Hitchins has been trying to sell her home at 3148 Browning St. in Sarasota for two months. A real estate agent associated with Sarasota's Carefree Realty, she recently dropped her offering price by $20,000 to $259,000.

"So far, I haven't had an offer," she said. "I think that it is just a timing thing. As we all know, the market has changed drastically in the last 12 months."

The drop in prices during June is not news to Felix Power, president of the Sarasota Association of Realtors. What is news is the number of listings remaining stubbornly high.

Last month, there were 7,025 homes and condos listed for sale in Sarasota County compared with 9,193 in April. Although the absolute number of homes listed decreased, the rate of absorption did not. Only about 5 percent of listed homes are bought each month, a ratio that has not improved significantly so far in 2006.

"Those who did not need to sell have removed their houses from the market, and those who did need to sell have adjusted prices accordingly," Power said.

Some real estate agents said they expected the price drop for months after listings doubled and then doubled again in the last 12 months.

"We're also seeing home prices slashed by 15 percent off the listing price," said Shaun Peens, a South African-born broker and co-owner, with wife Kim, of the Peens Property Group in Lakewood Ranch.

The price drop comes as "some negative spin" in the market, but Peens hopes it encourages sellers "to get off the high" of 2005's unsustainable values.

"Homes are still selling well if priced well," he said.

Carla Rayman, a broker and owner of Sarasota's Cloud Nine Realty, says that business has begun to pick up even in this traditionally slow time of year. Her phone has been ringing more in the last two weeks than it has in the last three months, she said.

"I have a showing a day now in the off-season, when in the high season a few months ago there was nothing."
_____

Staff writer Harold Bubil contributed to this report.

Home sales in Bradenton-Sarasota down 40 percent in June

According to a recent article in the Bradenton Herald: The Bradenton/Sarasota real estate market's high prices took a tumble in June but lower prices didn't seem to spur sales.
The median price of an existing home fell by 3 percent, roughly $10,000 last month, according to numbers released by the Florida Association of Realtors. Bradenton-Sarasota was one of seven Florida markets to see prices falter, while areas like Gainesville and neighboring Tampa-St. Petersburg-Clearwater continued to see double digit appreciation.

Even with falling prices, Bradenton-Sarasota remained the fifth most expensive place to purchase a home in Florida.

Top loan officer sees challenges for lenders

Sarasota Herald-Tribune - Sarasota,FL,USA... The bottom line is it appears that 2006 will be the third-best year in Sarasota's real estate history (as industry leaders correctly predicted in January).