The Difference an Escrow Company can make

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freedomcm said:
wow.  are escrow cos required to have insurance to cover these situations?
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It depends upon how they're set up.

If they are licensed through DOC (dept. of corporations) they are required to have insurance to cover this type of situation. They also have to follow a stricter set of guidelines about how money is transferred in/out (wire transfers vs. cashier's checks vs. ACH vs. personal checks, etc.). They are also required to have more specific guidelines and policies for trust logs and data safety (dedicated systems/computers), as well.

If they are just licensed through a RE broker, there is not the same requirement and while this kind of occurrence is very rare, this is the possibility that may come up.

The 40+ transactions that are withoout their $1M of missing money are all stuck in limbo. It's not a good spot to be in, I'm sure. I'd have no idea where to start if I were in that spot. Pretty sure some brokers' heads will roll.

-IR2
 
I won't never trust a small time escrow company.  Essentially you're entrusting them with your money for at least 30 days. 

With that said, I have dealt with a few large title/escrow companies and they are often pretty incompetent.
 
it seems like buyers have no choice on escrow...almost all the purchase agreements say sellers choice.  as a buyer, how would you push for a certain escrow company?
 
I know it's a Seller's market, and a hard counter might cost you the deal, but somewhere there should be some buyer protections about the "what if". "What if" we use the Seller's choice of services and there is an issue? Who is liable? A counter listing that the "Seller accepts all liability if the Seller's choice of services fails to deliver Buyer Agent commissions and Buyer's excess funds from closing within 10 days of settlement", or something like that.
 
Soylent Green Is People said:
I know it's a Seller's market, and a hard counter might cost you the deal, but somewhere there should be some buyer protections about the "what if". "What if" we use the Seller's choice of services and there is an issue? Who is liable? A counter listing that the "Seller accepts all liability if the Seller's choice of services fails to deliver Buyer Agent commissions and Buyer's excess funds from closing within 10 days of settlement", or something like that.
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In our current market where 20%, 30% or all cash deals are done, I'm not worried about my excess funds, I'm worried about my $150,000 down payment vaporizing before they close the deal and transfer title.

Perhaps a offer of buyers accepts Seller's choice of Escrow from the following list of 3 or 5 or 10 escrow companies or simply, buyer accepts Seller's choice of fully bonded and insured Escrow.

None of which really prevents the main problem which is once your money is in the Escrow and this boondoogle happens how long is everything tied in limbo before someone pays up to finalize the deal.
 
Does anyone have any suggestions for a good low-priced escrow and title company?  I've got two properties for sale and have accepted one offer.  I went to an escrow company that I used in the past, but the rates are high.  I used to pay 1.10 to 1.25 per $1000 in escrow fees.  They are charging 1.95 per $1000 plus $195.  Title is the same issue.
 
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