Why Should Consumers, Homeowners Be Concerned About Settlement Agents?

Why should a consumer be concerned about the person who is “settling” their loan? The attorney, title agent, escrow officer, or notary who is managing the documents and money at the closing can cause you harm.  These professionals, who have varying degrees of education, training, insurance coverage, and competency, are the only people connected to your mortgage transaction who have access to the bank’s money, your money, your personal and financial information, and the important bank documents that verify and finalize your ownership of your new home. 

Consumers should be concerned about settlement agents because they may not always act in the best interest of the consumer. They may have conflicts of interest, such as receiving kickbacks from lenders or charging excessive fees. Additionally, some settlement agents may not have the necessary qualifications or experience to properly handle real estate transactions. Consumers should do their due diligence and research potential settlement agents before hiring one, as well as familiarize themselves with the process and their rights.

Unfortunately, the FBI has called mortgage fraud which often takes the form of fake documents, unrecorded deeds, title fraud creating a cloud on ownership, theft of funds, wire fraud, and other issues, “the number one white-collar crime in America.”  Wire fraud alone has caused billions of dollars of financial harm to banks and private citizens every year for the past several years.