Yes, lenders and banks had a lot to do with the current economic crisis. But what about the huge industry players like First American Title Insurance Company.
News from various law firms and attorneys are circulating the blogsphere about several class action lawsuits against this title company for their involvement in several real estate and home loan kick back schemes.
This is the most common allegation against First American Title and they have been accused of doing this for years. But when the money dries up and there is no money to kick back, people sue and point fingers.
“These types of payments to real estate settlement providers are bad for consumers because they artificially inflate the price of title insurance,” Toll said. “I believe this is one of the reasons that title insurance rates have not decreased even though title searches are nearly 100 percent electronically performed.”
Title insurance, which typically costs home sellers between $500 and $1,000, protects lenders and owners against losses from property-ownership disputes.
Toll said the alleged kickback scheme comes under the guise of “marketing agreements.”
“They’re saying: You can have exclusive rights to all of our work if you pay me money and we call it marketing,” she said.
More current lawsuits against First American Title
First American Title InsuranceDate Filed: May 14, 2008
Court: U.S. District Court
Location: Northern District of California
Ticker Symbol: FAF
Hagens Berman Sobol Shapiro filed a lawsuit on behalf of consumers against one of the nation’s largest title and escrow companies, First American Title Insurance, claiming the company engaged in a series of schemes and deceptions designed to bilk customers out of millions of dollars.
The lawsuit identifies four schemes created to bilk customers.
First American also engaged in an affiliate reconveyance scheme, steering customers to subsidiary businesses for reconveyance tracking then charging the customer three times the rate the affiliated company charges independents, the suit claims.
The complaint alleges First American engaged in a captive reconveyance scheme – charging customers fees for reconveyance when the reconveyance is actually done by the prior lender, a charge built into the payoff amount.
The complaint also claims First American engaged in a retained interest scheme, pooling customer’s loans and taking the profit from gained interest, the suit states. The company failed to disclose this to customers, which is a violation of fiduciary duties, according to the claim.
All information contained in this transmission is confidential and Hagens Berman Sobol Shapiro agrees to protect information against unauthorized use, publication or disclosure. However, if you would like to join the class and do not wish to submit information via the Internet, please contact us by phone at (206) 623-7292. We would be happy to discuss eligibility with you then. If you used First American Title Insurance, please contact HBSS by clicking here or e-mailing email@example.com.
A lawsuit is what prompted the state to look into whether real estate brokerage companies are requiring title companies to pay for referrals.
Re/Max International Inc. filed the suit against a California title company, First American Residential Group Inc., on March 20 in Denver District Court.
The suit claims that First American didn’t fulfill the terms of a marketing contract requiring it to pay Re/Max $1.35 million for marketing its services to Re/Max franchisees.
Such marketing contracts are being investigated by the Colorado Division of Real Estate. The division has subpoenaed records from Re/Max International and First American Residential, as well as eight Colorado real estate brokerages.
Erin Toll, the division’s director, wants to look at marketing agreements the companies have with real estate settlement-service providers, such as title and mortgage companies.
I have a new website that I will thoroughly chronicle First American Title’s busines practices and the hundreds of lawsuits this now bankrupt company is facing. That website is www.FirstAmericanSucks.com and I encourage all homeowners, ex-employees or real estate professionals that know of any dirt on this company to please join me in fighting this Goliath that has made billions off the suffering backs of homeowners.