Title insurance is a critically important part of any real estate transaction; or at least it should be. The title company guaranties the "quality" of an owners interest in the property - that there aren't any (unknown) liens or defects. No buyer that I work for will purchase a property without it.
Title insurance is only as good as the insurer. We want to know that the insurance company, like the Rock of Gibraltar, will always be there. We want to sleep easy at night, knowing that the client is protected.
That said, it was a bit distressing to see that PLM Title Company shut its doors, without any forewarning last week. Worse still, this morning's news is that there is a criminal investigation underway - and that we do not yet know why. Old timers like me shudder with memories of the great Intercounty Title debacle five years ago. Here's to hoping that this one is nothing like that one.
Set aside the problems involved trying to make a claim against a defunct title company. What about the banks and buyers (and sellers) that had money being held in escrow by that title company? Or had deeds and mortgages waiting to be recorded with local county recorders offices? Or who had escrow closings scheduled there to consummate their transactions? Big mess
Any good news in this for my clients? I suppose the "good news" is that, (a) I have had only two buyers in the last five years purchase title insurance from PLM; (b) their insurance was underwritten by Guaranty Title & Trust Company, still a viable and presumably well capitalized company, and (c) three years ago, I instituted an office policy that we will only accept title insurance from a short list of the strongest title companies, in order to problems of the sort presented when "the Rock" crumbles.
UPDATED: Nov. 20, 2008: I erroneously identified PLM's underwriter as Guaranty National when this message as originally posted. The correct entity, Guaranty Title & Trust Company was liquidated on October 27, 2008 by Ohio state regulators. All insurance policies, commitments and certificates of insurance issued by GTT, are cancelled, effective November 26, 2008. Inquiries regarding the GTT liquidation and requests for Proofs of Claim forms should be directed to: The Office of the Ohio Insurance Liquidator, Attn: GTT, 50 W. Town Street, Third Floor, Suite 350, Columbus, OH 43215. The telephone for that office is (614) 487-9200.
PLM's other underwriter Pacific Northwest Title Insurance, remains a viable entity.
Title insurance is only as good as the insurer. We want to know that the insurance company, like the Rock of Gibraltar, will always be there. We want to sleep easy at night, knowing that the client is protected.
That said, it was a bit distressing to see that PLM Title Company shut its doors, without any forewarning last week. Worse still, this morning's news is that there is a criminal investigation underway - and that we do not yet know why. Old timers like me shudder with memories of the great Intercounty Title debacle five years ago. Here's to hoping that this one is nothing like that one.
Set aside the problems involved trying to make a claim against a defunct title company. What about the banks and buyers (and sellers) that had money being held in escrow by that title company? Or had deeds and mortgages waiting to be recorded with local county recorders offices? Or who had escrow closings scheduled there to consummate their transactions? Big mess
Any good news in this for my clients? I suppose the "good news" is that, (a) I have had only two buyers in the last five years purchase title insurance from PLM; (b) their insurance was underwritten by Guaranty Title & Trust Company, still a viable and presumably well capitalized company, and (c) three years ago, I instituted an office policy that we will only accept title insurance from a short list of the strongest title companies, in order to problems of the sort presented when "the Rock" crumbles.
UPDATED: Nov. 20, 2008: I erroneously identified PLM's underwriter as Guaranty National when this message as originally posted. The correct entity, Guaranty Title & Trust Company was liquidated on October 27, 2008 by Ohio state regulators. All insurance policies, commitments and certificates of insurance issued by GTT, are cancelled, effective November 26, 2008. Inquiries regarding the GTT liquidation and requests for Proofs of Claim forms should be directed to: The Office of the Ohio Insurance Liquidator, Attn: GTT, 50 W. Town Street, Third Floor, Suite 350, Columbus, OH 43215. The telephone for that office is (614) 487-9200.
PLM's other underwriter Pacific Northwest Title Insurance, remains a viable entity.
Comments
Victim #1
Our lender never received the payoff,
PLM stalled as best it could,
Pamela Williams sent misleading assurances to me (presumably to stall), and
The final check to my lender was not honored (PLM stopped payment on it).
Apparently there are several people affected by this fraudulent title company and the crooks who led it.
We have not yet been made "whole". This has been an utterly disgusting experience. It is distressing to know that there are such title companies out there. Hopefully these crooks will be brought to justice and shall feel the full weight of the law.
It is interesting that no more "facts" pertaining to this case have been brought forward, considering this was not a small criminal matter.
If anyone has advice on how to proceed, other than simply waiting for the Insurance companies (Guaranty and Pacific) to decide on when to make us "whole", then please feel free to share. Thank you
http://www.chicagobreakingnews.com/2010/10/prosecutors-as-much-as-6-million-stolen-in-mortgage-scam.html
Two DuPage businesswomen who illegally used money from customers at their Wheaton title company for their personal use each were sentenced today to 10 years in prison and ordered jointly to pay $1.8 million in restitution.
Pamela Williams, 58, of Darien, and Patricia Johnson, 57, of Naperville, pleaded guilty in April to 10 counts of theft, stemming from their operation of the PLM Title Company from 2005 to 2008.
The pair would facilitate homeowners seeking a refinanced mortgage and were supposed to take the funds issued by a new mortgage lender and pay off a customer’s first mortgage.
Assistant DuPage County State’s Attorney Diane Michalak said that the pair “ran the business into the ground” and used their customers’ money to pay off credit cards bills and pay for personal expenses, like Williams’ daughter’s wedding at a DuPage country club, upkeep of a trailer at a Indiana lakeside, and refurbishing Johnson’s home kitchen with new cabinets.
Michalak said that many of their former clients still own double mortgages on their homes and have not recovered from their financial loss, while some have received insurance settlements after many months of paying double mortgages.
“You should be ashamed of your pitiful, disgusting, shameful behavior,” said Judge John Kinsella. “One iota of common sense in your brain should have made you realize what you were doing.”
Mark Kowalczyk, Johnson’s defense attorney, said, “The collapse of the real estate market caught these ladies off guard. They were intending to pay off.”
Michalak acknowledged that the downturn of the real estate market in 2007 had an adverse effect, “but when that crash happened, they just stole more money.”
Several victims testified that they paid off two mortgages for extended periods of time, with some getting insurance settlements and others still waiting for help.
Jocelyn Cole, of Chicago, testified, “I still have two mortgages and I can’t pay the bill. I worked hard for someone to tear it all down.”
Wheaton Detective David Zdan said that the firm closed its doors in 2008 after being confronted with evidence that the officials may have stolen more than $3 million that they were covering up in audits by producing counterfeit bank payments.
Michalak said that the investigation showed that the pair may have illegal taken as much as $3.2 million from September 2005 until the scheme was uncovered in April 2008, and that police believe the theft may have begun as early as 2002, possibly accounting for another $3 million in stolen funds.
She said that from 2005 through 2008 each of their expenses were about $9,000 to $10,000 a month more than their income.
Both Williams and Johnson were eligible for prison terms from four to 15 years.