Question about Closing Agent Pricing

7 Replies

Hello,

I am putting together a deal and looking for a title company in Chicago.  One got back to me with their pricing and I'd love some advice about whether it is a fair price or not.  It is more than I thought, at this price I wouldn't make any money.

Also, in a wholesaling deal who pays for what in the B to C transaction?  Is it common for me (B) to pay for everything or should the cash buyer (C) pay for half?

Below is the email the title company sent.

Thanks!

Elliot Erickson

Below is the pricing for the first purchase transaction for a purchase price of $68,000.00 based upon the transaction being a cash transaction:

Seller charges:

Owner’s Policy - $1,525.00

IL Policy Fee - $3.00

ICPL (Seller) - $50.00

Zoning Certification Processing Fee - $80.00

Water Certification Processing Fee - $80.00

Zoning Certification - $120.00

Update Commitment Fee - $125.00

City of Chicago Transfer Tax - $204.00

State Transfer Tax - $68.00

County Transfer Tax - $34.00

Notarial Record Fee (If Applicable) - $25.00

Notarial Record Filing Fee (If Applicable) - $5.00

Recording of Release (If Applicable) - $54.00

Payoff Processing Fee (If Applicable)- $40.00

Proceeds wire fee (If Applicable) - $40.00

Buyer charges:

Closing Fee - $1,075.00

ICPL (Buyer) - $25.00

Recording of Deed - $54.00

Recording of Power of Attorney (If Applicable) - $54.00 estimated

Wire Fee (Per wire) - $40.00

Document Administration Fee - $25.00

Email Fee - $40.00

Later Date Examination - $125.00

City of Chicago Transfer Tax - $510.00

Below is the pricing for the second purchase transaction for a purchase price of $75,000.00 with a loan/mortgage policy:

Seller charges:

Owner’s Policy - $1,525.00

IL Policy Fee - $3.00

ICPL (Seller) - $50.00

Zoning Certification Processing Fee - $80.00

Water Certification Processing Fee - $80.00

Zoning Certification - $120.00

Update Commitment Fee - $125.00

City of Chicago Transfer Tax - $225.00

State Transfer Tax - $75.00

County Transfer Tax - $37.50

Notarial Record Fee (If Applicable) - $25.00

Notarial Record Filing Fee (If Applicable) - $5.00

Recording of Release (If Applicable) - $54.00

Payoff Processing Fee (If Applicable)- $40.00

Proceeds wire fee (If Applicable) - $40.00

Buyer charges:

Loan Policy - $500.00

Closing Fee - $1,075.00

ICPL (Buyer) - $25.00

ICPL (Lender) - $25.00

IL Policy Fee - $3.00

Chain of Title - $125.00

Predatory Lending Certificate - $150.00

Recording of Deed - $54.00

Recording of Mortgage - $86.00

Recording of Power of Attorney (If Applicable) - $54.00 estimated

Recording of Assignment of Mortgage (If Applicable) - $54.00

Wire Fee (Per wire) - $40.00

Document Administration Fee - $25.00

Email Fee - $40.00

Later Date Examination - $125.00

City of Chicago Transfer Tax - $562.50

Endorsements - $175.00 per endorsement

Seems like they are nickel and diming a lot.

Have you gotten  quotes from 2 to 3 others to compare and contrast??

Remember if it's a large title with volume they might be fat cats. A smaller group might be willing to do a deal on the fees to get business. Most of the local title companies have the policy go through one of the big three anyways that they associated with.

First American, Old Republic, etc.  

Let's forget the title company for a minute and back the deal train up.  I have a couple of questions that need to be answered, before you get to closing...

1.  Did you not factor in "fixed costs", when you did your deal analysis?

2.  Why in the world would you do a double closing on a property with a purchase price <$100k?  Double closing is always going to be more expensive.  I would just do a straight assignment of contract.

If you didn't analyze your deal correctly, you may have to facilitate this sale, to be fair to the seller, and walk away with little or no profit.  Afterwards, you need to sit down and reevaluate your deal analysis process.  It doesn't sound to me like you understood the numbers and costs involved with the process.

I think you will be better off finding a mom and pop title company, and you can save a lot of fees.


Joe Gore

Wow, $1525 Owner's policy twice? That is high for once, and they have no additional research for the second.

Hi Elliot

Illinois is an attorney close state - in Chicago you don't close at a title company, your attorney does.  And you'll find that most attorneys have a favorite title company that they work with.

Closing costs are extremely expensive in Chicago (as you're finding out) so I agree with  the other comments - you want to assign any deals that you find, not do double closes.

Good luck

Larry

You can get numbers from Joe Talarico who is real estate attorney in Chicago but he also is a partner in Barrister Title which is a smaller title company where you can usually get some better pricing.  

708-935-5205

[email protected]

Everyone,

Thank you for the wonderful advice.  I will take it all.  I've learned that I can stay involved with the transaction, after the contract is assigned, until it closes.  So, I will be doing that for this and other deals.

Also, I will give the mentioned lawyer a call.

Thank you again, I look forward to being able to help others here as I have been helped!

Regards,

Elliot Erickson

Asgaard Real Estate

847-773-7488 

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