Click here for a list of independent Minnesota title firms:
Affiliated Business Arrangements are legalized kickbacks (click here to learn more about this problem). They are allowed only because of the immense lobbying power of the real estate industry (the second most powerful in the United States – click here). Just because they may be legal does not mean that they are good for consumers. RESPA (Real Estate Settlement and Procedures Act) prohibits kickbacks because, “Kickbacks harm consumers by hampering fair market competition and by unnecessarily increasing the costs of getting a mortgage.” (Richard Cordray, Consumer Finance Protection Bureau Director).
Affiliated Business Arrangements, also known as “one-stop shopping,” depend entirely upon the vulnerability of consumers who, by and large, lack the know-how to navigate the real estate marketplace. Many realtors exploit this and are able to steer their clients to in-house or affiliated title companies which, for the consumer, result in over-priced title products and higher risk closings that line the pockets of brokers and their affiliated title companies. Remember, real estate brokers are legally and ethically obligated to look out for your best interests, not theirs. Unfortunately, our real estate system is broken. Empower yourself by shopping around for an independent title company (click here for a partial list) to compare prices and title insurance policies.
Report Steering to the Minnesota Department of Commerce: If you feel that you were steered into an affiliated title company, that may constitute “solicitation” of insurance and other unlawful conduct. File your complaint here: Minnesota Department of Commerce Real Estate Complaints.