At Premier Title, we are serious about being “A Different Kind Of Title Company.” One of the ways we are different is that we do not charge “junk” fees. Unfortunately, some settlement agents give low estimates to consumers for their charges, in order to get business. At Closing, they surprise the consumer with a lot of junk fees that they do not tell the consumer about in advance. These annoying, usually small, charges can add up to a material amount. While some may be justified, many may not be. What are some examples of junk fees? Only the imagination limits them. But, here are some of the more common examples that we have seen:
What are some examples of junk closing fees?
Title Exam Fee – It is no longer legal for settlement service providers to charge a title exam fee in Florida. This is now considered to be included in the title insurance premium.
Mortgage Satisfaction Fee – A normal part of clearing title for which the title agent is paid through the settlement fee and title premium.
Long Distance Telephone Calls – Some charges may be justified where, for example, large numbers of overseas calls must be placed, but normally, this is simply a part of the settlement agent’s overhead.
“Recertification” Fee After Closing or “Title Update” Fee – This is a normal part of the process of updating title after closing prior to issuing the title policy and should be included in the search and exam for a title premium. An exception to this is a construction loan where multiple updates may be required as advances are made. A reasonable charge for updating title in such circumstances is justified.
“Mailaway” Fee – There is no extra time involved in a mail-away versus a face-to-face closing. In fact, the reverse is frequently the case.)
Postage – Except in unusual situations, a normal cost of overhead.
Telecommunications Fee – A normal cost of overhead.
What are some examples of legitimate fees and charges that Premier Title doesn’t consider to be “junk”?
Settlement Fee, Title Search and Title Insurance Premium– The normal fees that settlement agents charge and that are required by law to be stated separately. These cover the costs of searching and examining the title, making all the arrangements necessary for closing the transaction, clearing the title (including satisfying existing mortgages) updating the title after closing, disbursing the money, recording the documents and issuing the title policy.
Title Endorsements – Where required, the settlement agent must list these charges separately and must remit the appropriate amount to the title underwriter.
Courier Charges – These take time, involve an actual out-of-pocket cost for the settlement agent and are not required in all transactions.
Fees for Unusual or Special Services – Generally, these don’t require an additional or special fee, but an increase in the Settlement Fee or the Title Search Fee. These might include situations where estates are involved; where lengthy, complicated metes and bounds legal descriptions are involved; where foreign buyers or sellers are involved; where companies (including foreign companies) rather than individuals are involved; where special arrangements must be made for the execution of documents in remote or unusual locations, etc., etc. The settlement agent should explain these costs to the person paying them as soon as the settlement agent knows that they will be incurred.
Recording Fees and Taxes – These are the actual fees by the county clerk to record the documents involved in the transaction and the actual taxes that must be paid when the documents are recorded. They vary according to the number of documents and number of pages that are recorded and the size (in dollar terms) of the transaction involved.
Construction Loan Updates – Generally, in construction loans, multiple advances are provided as construction progresses. In such cases, lenders require that the title be updated at the time of each advance in order to ascertain that no construction liens have been filed and to determine the status of title prior to making the advance. The title agent then certifies the condition of the title to the lender who then proceeds to make the advance.
Municipal Lien, Open Permit and Code Violation Fees – These are the actual fees charged by the County and/or municipality where the property is located in order to determine whether any of these items are outstanding and provide the parties with an opportunity to deal with them prior to closing rather than having them come up at a later date.
Wire Transfer Fees – These are legitimate charges when they represent the actual cost incurred by the title agent in sending and receiving wire transfers.