Saturday, August 23, 2008
Interesting how they change their tune
We had another "deed and green" transaction, this one in Poweshiek County in Iowa. The attorney charged $85 to prepare a deed. There was a strange little title defect, and when we called the attorney, he told us, "Why are you asking me? The real estate agent represents them." Clearing title defects in Illinois and Iowa is considered the practice of law, and therefore real estate agents are not allowed to clear title defects. We believe we are assisting in the unauthorized practice of law when we "work with" real estate agents in clearing title defects. We also believe that attorneys should "do their job." I sent the attorney a letter outlining my concerns, advising that I was not about to assist in the unauthorized practice of law, and including a copy of the Iowa Court Rules which set forth what real estate agents can and cannot do in real estate transactions. By golly, he called me right back, and started working on clearing that title defect.
Thursday, August 21, 2008
These are supposed to be smart people
http://www.chicagotribune.com/business/chi-sun-title-insurance-fraud-aug17,0,1998638.story
Ticor is claiming that they should not have to cover a title claim because Countrywide should not have given the loan to these scammers. Heck yes, Countrywide should never have given this loan. But Ticor agreed to take some money to insure title. Unfortunately, their local agent may have been a bit sloppy according to the article. That's not really Countrywide's problem. Maybe Ticor should have done a better job of qualifying and/or checking on their agents.
I understand the sentiment, really I do. If Countrywide had done its job and seen all of the neon clues that this was a scam from top to bottom, they would never have given the loan, and therefore, they would never have hired Ticor to give them a title policy, and therefore, there would be no title claim. But isn't this tantamount to your car insurance company refusing to cover you because the accident would not have happened if you were not driving? If Ticor succeeds in this case, haven't they demonstrated that title insurance is worthless? And, having done that, wouldn't they have litigated themselves out of existence?
Ticor is claiming that they should not have to cover a title claim because Countrywide should not have given the loan to these scammers. Heck yes, Countrywide should never have given this loan. But Ticor agreed to take some money to insure title. Unfortunately, their local agent may have been a bit sloppy according to the article. That's not really Countrywide's problem. Maybe Ticor should have done a better job of qualifying and/or checking on their agents.
I understand the sentiment, really I do. If Countrywide had done its job and seen all of the neon clues that this was a scam from top to bottom, they would never have given the loan, and therefore, they would never have hired Ticor to give them a title policy, and therefore, there would be no title claim. But isn't this tantamount to your car insurance company refusing to cover you because the accident would not have happened if you were not driving? If Ticor succeeds in this case, haven't they demonstrated that title insurance is worthless? And, having done that, wouldn't they have litigated themselves out of existence?
Tuesday, August 19, 2008
Say the name! Say the name!
A banker friend of mine told me he had a conversation with a real estate agent who was complaining that I was not "flexible" about how something should be done in a real estate transaction. He knows how I operate, and he asked, "Well, was he right?" To which the real estate agent responded, "I guess so. Technically....." I was so proud.
Speaking of flexibility, I came across the following press release from the Department of Justice District of New Jersey website.
http://www.usdoj.gov/usao/nj/press/press/files/pdffiles/cart0813%20rel.pdf
Here is a brief quote:
"According to the Indictment, the borrowers attended closings at a Garfield law office where Gebbia worked. There, at the closing attorney’s direction, Gebbia prepared fraudulent HUD-1 Uniform Settlement Statements that were signed by the borrowers, Ugwu and others reflecting deposits that had never been made. The closing attorney then allegedly distributed proceeds of the fraudulently-obtained mortgage loans to the conspirators by checks made payable to companies controlled by Eliasof, who in turn paid kickbacks to Carti, the closing attorney and others. "
I can only hope they did not name the closing attorney because they have something really "special" planned for him/her. Not only do attorneys have a lot to lose by playing these games, they violate their duty to their clients by allowing these transactions to go through this way. Perhaps if a few more attorneys would have stood firm, we might not be in the mess we are in right now. Sure, some real estate agent might complain that we are "not flexible," but isn't that our job?
Speaking of flexibility, I came across the following press release from the Department of Justice District of New Jersey website.
http://www.usdoj.gov/usao/nj/press/press/files/pdffiles/cart0813%20rel.pdf
Here is a brief quote:
"According to the Indictment, the borrowers attended closings at a Garfield law office where Gebbia worked. There, at the closing attorney’s direction, Gebbia prepared fraudulent HUD-1 Uniform Settlement Statements that were signed by the borrowers, Ugwu and others reflecting deposits that had never been made. The closing attorney then allegedly distributed proceeds of the fraudulently-obtained mortgage loans to the conspirators by checks made payable to companies controlled by Eliasof, who in turn paid kickbacks to Carti, the closing attorney and others. "
I can only hope they did not name the closing attorney because they have something really "special" planned for him/her. Not only do attorneys have a lot to lose by playing these games, they violate their duty to their clients by allowing these transactions to go through this way. Perhaps if a few more attorneys would have stood firm, we might not be in the mess we are in right now. Sure, some real estate agent might complain that we are "not flexible," but isn't that our job?
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