Your analogy is very different. I thought you were sharper than that.

This person didn't steal the money, it was given to them by mistake and the person thought it was the correct settlement he was entitled to. Not surprising since most people are lost when looking at HUDs and the like.

Hell, I bet if you had to calculate 10 settlements yourself while sitting in a closing room with nothing but a calculator and a pencil you'd probably get at least 1 wrong and you're an experienced agent ... surely we can't expect laypeople to check and correct the math of the closer?

Come on but $10,000 off? Even if you were off a 1,000 or 2,000 in your estimate for closing costs (which would be an enormous amount to be off) and as long as you knew your payoff and how much the house sold for you should be able to get an idea... and when the number you end up with is even 7 to 8k higher than you expected, you're telling me you wouldn't even ask to make sure? I don't know about where this person came from but at closing here, the closer reads through each line of the HUD-1, ignorance is no excuse for refusing to give the money back.

-J

I'm a little clairvoyant at times... Every time I open this thread, a little voice repeats this phrase to me...

"In the matter of Closing Company v. JohnSoPA, we the jury find for the plaintiff, specific damages of $10,000, and punitive damages of..."

The voice kinda fades out there at the end... I'm not sure what that means, exactly... Does this make sense to anyone?

I had a closing today and it was the last of the day for the title company so I got the owner and her title attorney together and posed this scenario to them.

They have had a similar situation at their title company which they found a couple of months later.

The couple that got the additional monies had already spent most of it and, to make matters worse, they had divorced. They called them up and told them to pay up or they would be seeing them in court. The husband is now making monthly payments to the title company.

They have a form both buyers and sellers sign at closings saying they will cooperate with the title company in correcting any mistakes they may make preparing and executing the paperwork.

They also said a claim like the $10,000 misunderstanding COULD be covered by their Errors & Omissions insurance but that they would probably pay it them selves to avoid filing a claim which could lead to cancellation of their E & O insurance or higher premiums.

In whatever event they also said they would pursue recovering the monies very vigorously including going to court if necessary.

Additionally if they did file a claim with the E & O carrier then after the E & O carrier reimbursed the title company the E & O company would almost certainly go after the guy that got the money wrongly under their subrogation rights.

Subrogation is when you pay off someone's debt and then try to get the money from the debtor yourself.

Subrogation is, for example, an uninsured motorist hits your car and damages it. Your insurance company will repair your car but they will also go after the drive that was at fault to recover their expenses in fixing your car.

Somehow after hearing all this I don't think the guy that wrote the original question here is going to get to keep the 10 grand he got that he was not supposed to.

No free lunch in real estate.

If at Closing this person had $10,000 taken away and the title company found this out during their year end evaluation... Do you really think the title company would have called this guy and sent him a refund???? I DON'T THINK SO.... Keep the money and see if they have the procedures in place to make you pay it back..... And for all you who posted and seem so sure you would give it back... Give me a break...

Thanks for sharing Mwgreco, Are you a Realtor? If so, do you apply the same finders keepers, losers weepers standards when dealing with your clients funds?

Interesting thread here I have been reading. I just can not believe we are all responding to the orignal post. First its not his money. Two It should be returned. Three why even ask. And four I know I aways look at the HUD and also check my and my clients figures figures very carefully. I think he should have caught this at the closing company and had them correct it. I can not believe he did not notice it also. ten grand is something anyone should have noticed. It not at the closing table then the next day when you processed it. So in plain english he should give the money back and thank his blessing he is not being charged interest and also going to jail.

In our state the broker has a liability/responsibility for the correctness of the HUD1 (Brokers can do closings here). Maybe the broker should pay?

In reply to mwgreco, Yes, I do think the title company would refund the money. Suppose they were audited after they found the error. You think they might get fined for sittting on 10,000?

Dave Clark is 100% correct.... Title Companies are under a similar requirement as Real Estate Brokerages in handling of ESCROW Accounts... they must be fully auditable and they do have mandatory reports on funds being held/ for whom/ and why.

Those funds are NOT in the Title Companies Operation Funds.... they are an Escrow account.