We sent a customer our LE with the Service Provider List. Customer expressed intent to proceed and went with our title company on our list; we ordered title. Customer did not like an indemnity agreement that accompanied the title report (owner/builder construction loan) and wanted to use a different title company that he had used before. We cancelled the initial title commitment through our service provider and ordered through his requested title company. Our preferred title company sent us an invoice for the cancellation of the policy. Can we pass this fee on to the customer and if so, what section would it go in? Or, do we have to pay the cancellation fee? Thank you.

The customer requesting you go with a different title company could be a valid CC but in order to pass the fee on, you would have needed to redisclose to capture the cancellation fee within three days of the customer making the request.

fwiw, if you do a lot of business with this title company, I would reach out to them and ask them to waive the fee. It's at least worth the try.

We missed the three day window and we use this title company a lot locally but this deal is in the next state over and we don't do a lot of deals in that state. Although it is the same title company it is a different regional office and our relationship with them is not as close as it is here in our state; they won't waive it.......we tried. So, we will eat the fee which was my initial instinct. Thanks for the feedback.

Customer did not like the indemnity agreement wording given by our preferred service provider; the other title company that he had used before used a different form with different wording.....he would not sign the indemnity agreement given by our service provider. So, in the spirit of customer service, we allowed him to go with another title company that he liked.....different title companies...different indemnity agreement wording. In our eyes, they were the same document but not worded exactly the same! It cost us $100!