While smaller title companies are struggling to stay afloat, cutting costs and downsizing just to stay open. Some who were once flooded with work are in high growth areas - downright bored. On the other hand, overworked giants are outsourcing to compensate for the huge influx of transactions, yet poorly processing the paperwork, causing an uprise in claims - up 15% from last year alone.
Kickbacks, incentives, and "friendly gifts" abound in an industry that strictly prohibits any such activity, costing a hefty sum in settlement charges for many who are caught. Recently I read an article about a builder who even attempted to require that all of his clients used a single title company - illegal by any standards, but prohibited by Federal laws stating that "anything of value" used in exchange for referrals of consumer business constitutes a violation of the law.
While it may seem that this is a hot topic of debate surfacing in the recent years to those who are new to the industry, but this is a problem that has been cultivated into our culture - it's nothing new. What is new is that the industry has grown larger than the public it serves in some areas. Think of it in this sense - if you put too many lobsters into a tank together, only the strong will survive, eating the weaker creatures. Mirror any business you know of? Well, put into simple terms, too many professionals in the same area offering the same services create the "lobster tank" in which only the strongest will endure - surviving only on the failure of others. In the future, we may see more industry-related crackdowns as the Federal government scrambles to get a handle on the real estate industry.
