Will consumers shop for settlement services?
Posted in RESPA reform By Matt Carter, Tuesday, April 15, 2008.Be interested to hear the group's thoughts on whether RESPA reform will spawn Web sites that allow consumers (and real estate and mortgage pros) to shop for settlement services.
See today's story on Fairclosingcosts.com's plan to launch next month.
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Submitted by Joe Cline on April 15, 2008 - 3:18pm.
Title insurance and settlement services are way overpriced. Title insurance is almost like big oil on a much smaller scale. For instance, when I refi, I pay another title policy? What's that for? In case I scammed myself and obtained my title fraudulently? I would welcome any ability to shop for title policies. I know that they do work to earn the title policy premium, but in Texas rates are regulated and competition is hardly there to help consumers. The title company lobby also has been successful in passing legislation that makes it illegal for title companies to compete for business or induce folks to give them business by providing any ancillary services. I wish we had their lobby.
Joe
Austin Real Estate | Certified Residential Specialist
Submitted by Steve Loper on April 15, 2008 - 8:56pm.
For all services other than title insurance this will work.
If you say "Title Insurance" to an end consumer, you will get a quizzical "What the heck that?" Or try to explain what "re-issue credit" is. Title insurance is more of a b2b enterprise. There is a niche market for this, but it wouldn't be huge.
For the other industries, this can spawn a whole new marketing area. Appraisers, and home inspectors can begin to market directly to the end consumer.
Here is the idea that some smart company like zillow should implement: Marketed to the end consumer "Close your own home" web site. Where the end consumer can manage the process. With document management, communication tracking ...
Wait, hold on a second, let me get to building my own site that does this. :)
steveloper.com
Submitted by Diane Cipa on April 16, 2008 - 5:43am.
I saw the Fairclosingcosts.com site and registered for future participation when they get to my state.
I wish Zillow would add title insurance and settlement services.
I have always spent my marketing dollar on consumer facing advertising. Visit www.chooseandsave.com. Visit http://titleinsurancetalk.blogspot.com. These are consumer facing sites.
It's the future. The point of sale is in flux.
Submitted by Kathy Glor on October 22, 2008 - 8:20am.
Hey Matt,
We were the only title company in Indiana to sign up at Fairclosingcosts.com. I tried to go to the site today and its gone!!!! Any information as to what happened to them?
Submitted by Diane Cipa on October 22, 2008 - 8:26am.
That's interesting, Kathy. I took a look at their set-up and decided to pass. It really wasn't of any value, in my opinion. The best way for a consumer to shop for title insurance and settlement services is to call a few companies and request full quotes in writing after discussing their transaction.
At least in PA, there are so many things which could impact a quote that a simple web site really can't pull it together in a meaningful way.
Witness the whole ENTITLE promotion. The fairclosingcosts.com site would only have quoted the title premium and would have missed the flat fees for services which eat up the purported savings.
Submitted by Kathy Glor on October 22, 2008 - 8:34am.
Gone capute..... They courted us relentlessly, we said no. Then they offered 90 days free, so we said OK. I was not happy about the format for pricing because our premiums are not done by range. There is no place for the additonal fees ie recording, express mail etc. We never received one hit or order. The premise was great. Maybe the consumer isn't ready for us to sell directly to them. Bummer ;)
Submitted by Diane Cipa on October 22, 2008 - 8:47am.
I disagree on the consumer. The consumer is DEFINITELY ready for us to sell to them directly.
I just got an order off our web site, input by the consumer for a cash purchase in the City of Pittsburgh. They used our shopping cart and gave us a $300 deposit using their credit card.
This consumer found the web site all on their own, used out rate calculator and read our fee data. He called to confirm that he understood. He did.
I received a call yesterday from a fellow who had been shopping, found my blog and site, went through the same thought process. Called me to confirm. He'll likely put in his order today or tomorrow.
The consumer is VERY READY to buy directly. You just have to reach out for the business.
Submitted by Dave Wirsching on October 22, 2008 - 8:47am.
This sounds similar to TitleInsurance.com and GetTitleInsurance.com (and several others). Most have or failing because they can't aggregate enough leads to make it worth anyone's $$$. Just not enough people shopping for title insurance online.
Also a problem with the "one size fits all" approach. Title Insurance pricing varies by state. Closing customs vary by state, sometimes by county and sometimes even within a county! Just too much variation to make a national clearinghouse workable.
The good news is that they enter the market and advertise, which tends to educate consumers. A little progress made each step of the way.
Submitted by Matt Carter on October 22, 2008 - 9:14am.
Thanks Kathy, I have put a call in to Jeff...
Submitted by Matt Carter on October 22, 2008 - 2:24pm.
Fairclosingcosts.com is back up.