how does bill to escrow work

[terry elliott]

i will be doing my first inspection and the buyer says it will bill to escrow , i am wondering what i need to do, does anyone have any advise for me ... thanks

[Mike Tracy]

Terry,

I get this request periodically. I try to find out who the closing company will be and send the invoice along with a cover letter explaining the clients request to pay at closing. If you let the client get the invoice to the closing company, chances are it won't happen.

You should also remind the client that if he does not purchase the home for any reason, they will be obligated to pay the bill.

Mike Tracy

[Jerry McCarthy]

Terry
Whenever I was asked to bill escrow I explained there was a $______ charge for such a service. After hearing the amount most found their check books. If they did agree I got all the necessary information; Title Company, address, phone number, title officer’s name and escrow account number and emailed our invoice the same day the report went out.

My secretary, a resolute as they come, also sent a hard mail copy of my invoice then after about 4 or 5 days called the title officer to confirm our invoice was in their property’s escrow file. She kept up the calls until escrow closed and we had our check. Only once in 15 years did a title company ever try to stiff me and as soon as they received my small claims court demand their check arrived in our mail.

Bottom line, you have to stay on top of this type of billing because it’s very easy for your demand to fall in the cracks and once the account is settled and closed it’s very difficult to get paid. Most of my brother inspectors would not bill escrow, but I felt the extra ____ fee charged help take the aggravation out of it.

BTW, never bill escrow for inspection done for the seller. (pre-listing type inspection) because in those cases you may be waiting anywhere from 6 months to never to see your check.

[John Goad]

There is a good chance of a "bill to escrow" working like this, you do the inspection & report your findings, the seller can't afford the repairs, the buyer can't afford the repairs & nothing ever gets to escrow.

[Nolan Kienitz]

Terry,

Do all you can to get the check "today" or at the close of your inspection data gathering.

As Jerry M. indicated an extra fee for billing to escrow is in order ... not just $25.00 either!

If you do proceed with the escrow payment, as noted above, you will have to keep on top of it to ensure you get the check. That takes time and time is money.

I try to avoid them as best as possible, but some do go to closing for payment, but I also get my 'handling' fee.

[Nick Ostrowski]

I have only gotten a handful requests to make payment for the home inspection at escrow and I batted them right back at the client. They way I see it, I provide a professional service with prompt delivery of the report the next day so I should be paid promptly. I personally don't care if the house ever goes to settlement and I don't want to have to worry about how I will be paid if the deal falls through (many of my inspections do result in no sale).

I guess some areas of the country are different when it comes to this type of payment.

[Rick Hurst]

I try to avoid "pay at escrow" which basically means they want to pay at closing at the title company.

Most clients want to do this most of the time because their company is picking up the cost of their move. That is always the case with the ones I have worked with.

How I handle it is I still ask the client to pay me with their own personal check which I will agree to hold for 30 days with an handling fee of 75. extra dollars added to the check.

I will then bill the title company for the inspection along with an extra fee of 150.00 which not one client has ever complained of because they know their company is picking up the charges.

I have an agreement that the client signs stating that if I don't receive payment from the title company within 30 days of the inspection, I have the right to cash or deposit the check they gave me at the original inspection.

If I do receive the check from the title company, I then tear the personal check in half and mail it back to the address on the check.

As someone else mentioned if you just wait for the title company to send you a check alone, you'll lose money eventually as the client will back out of the deal due to your report or possible because their financing of the home fell through.

[Scott Patterson]

I charge a $50 fee for payment at closing. I also require a CC number as a deposit in case it does not close within 30, if it does not I charge the card. I have never had a problem doing it this way.

[Jack Feldmann]

NO!

In case that wasn't clear - NO! I DO NOT TAKE PAYMENT AT CLOSING!

Way too many seemed to loose the paperwork, even though I followed up with hard copies, phone calls etc.
Way too many didn't buy the house and there just wasn't an escrow.

The straw that broke the camels back was one where the closing company screwed up the closing and I didn't get paid. I then had to go to my client and try to collect. It took over 6 months of getting small payments ever 6 weeks or so to get paid. Trying to get blood out a turnip.

So when someone asks, the answer is NO!
JF

[Nolan Kienitz]

NO!

In case that wasn't clear - NO! I DO NOT TAKE PAYMENT AT CLOSING!


So when someone asks, the answer is NO!
JF

Jack,

Pls ... don't hold back. :D

[Jerry McCarthy]

Didn't know we could quote pricing? I charged $100.00 for escrow billing and as you guessed that did not often happen, but when it did, oh well! My secretary/book keeper always managed to pocket the escrow fee, but I couldn't complain or she would stop making my meals, cleaning house and doing my laundry. Now a days everybody around here takes credit cards when they hear those fateful words "I don't have my check book with me."

[Bruce Ramsey]

No. I have buyers who have said the closing costs are being paid by the seller and they want to include this in the closing costs.

Fine. Here is a reciept that indicates you paid for my services. Submit the reciept to the closing attorney and get reimbursed. I do not delay payment until closing.

I had a customer who submitted my RECIEPT marked PAID IN FULL and the closing attorney sent ME a check. :rolleyes: I contacted my customer and said I would be happy to get paid twice for the job but offered to deposit the check made out to my company and send him a check. He mentioned I did a great job but not worth double the fee. Oh well. The customer has already referred me to his ex-wife and a co-worker who both booked inspections.

[Jim Luttrall]

I did bill the title company and stopped. I have gotten burned too many times. It was common practice in my small town and I never had much trouble... but then I moved to the big city. I still have several hundred dollars tied up in escrow from a deal that went south in 2006.
NO MORE!
Too much trouble. I'll take cash, check or credit card before they get the report.
Bill to escrow? NO!

[Matt Fellman]

We do it once or twice a year.... As with the others, it's a charge. We started taking visa/mc a few years back it has cut down a great deal on the requests. The cc merchant fee's sting a bit but it's worth it to get your money now... We also do a lot business for people moving in from other areas so the cc thing works great.

As for the nuts and bolts of the billing... just make sure to get the escrow officer's name and give him/her a call and introduce yourself. That way, they'll already know you if/when they mess up. Overall, the billing end of it is easy. This is the stuff the title companies do everyday. The only problems come about when a deal doesn't close.

[Jerry Peck]

the buyer says it will bill to escrow

Tell the buyer ... no problem, that's when my report gets issued ... when I get the escrow check.

Since this is your first inspection, if you loose it after doing it, use it as a 'training experience', including learning how to avoid 'billing to escrow'.

Preferably, though, you will want to get paid, and what if the deal does not make it to escrow? You don't get paid.

Thus, either check now and report now, or report at escrow when check is given at escrow ... of course, though, that does mean you will not be able to benefit from my report as your inspection time period will have passed ...

[James Duffin]

75% of my inspections get paid at closing. There has never been a time I did not get paid. I do not charge extra for this service. I guess it depends on how quick (or bad) you need the money. I have about $6000 owed to me at the moment.

[Jim Luttrall]

James, that is the position I was in until relocating. Good luck with it, I would no doubt still be billing to escrow if not for moving to the big city.

[Jerry Peck]

I guess it depends on how quick (or bad) you need the money. I have about $6000 owed to me at the moment.

James,

That's a different problem than billing to closing and not related at all.

During my last 4 years or so in the business I seldom got paid at the time of the inspection and after I completed the report and gave it to my client they would mail be a check.

I typically had about $20,000 per month 'in accounts receivable' waiting on those checks. When I retired, it worked out good as I received the last couple of month's checks over the next few months following retiring ... it was nice getting $10,000 per month ... to bad it could not have lasted longer. :D

Anytime you 'bill for the fee' there is a risk of not getting paid, however, when you bill to escrow you are adding in the risk that it may not get to escrow - the deal may fall apart.

I'm glad you have been successful on those collections, but it does not always work out that way - so the advise to a new inspection should include those warnings.

[Brian Cooper]

I get paid at closing about half of the time. I must admit that I have not had a bad experience. I don't charge extra either.

All I do is keep a simple Excel sheet with the address, buyer's name, and realtor's name and number. If I don't get paid when I am told, I call the realtor. It has not been a big deal for me. Actually, my realtors like it because their client does not have to come up with my fee up front. It makes them happy, so they call me more often. Seems like a win-win to me.

[Rick Hurst]

Actually, my realtors like it because their client does not have to come up with my fee up front. It makes them happy, so they call me more often. Seems like a win-win to me.

As long as their happy, I guess that is all that matters.

[Dan Blanchard]

So are we collecting through pay pale or how? I need to add this form of collection fast. I put in the phone book add that I accept payment by credit card. The phone book wasn’t supposed to be out for another two weeks and it’s already delivered!

[Scott Patterson]

So are we collecting through pay pale or how? I need to add this form of collection fast. I put in the phone book add that I accept payment by credit card. The phone book wasn’t supposed to be out for another two weeks and it’s already delivered!

You can do Pay Pal, but frankly it is a pain in the patoot and some will not use it. If you belong to Costco or Sam's Club they both have a good CC program. I use Costco and I have not complaints and I'm very pleased with it. I input the CC information on my computer and the money is in my account in two days. It will take a few days to set it up, but I think Pay Pal takes a few days to set up as well.

As for the cost of a CC service, I look at it as part of the cost of doing business. All cost associated with accepting CC's is deductible.

[Brian Cooper]

You can use PayPal, but they screw my account up at least once every month.

I'm sorry you bought a phone book ad. I have an ad in two directories and an online ad. It is the biggest waste of money I have had since I went into business. I have never received one single call off of the phone book, and they refuse to tell me how many hits I have recieved. You shouldn't have wasted your money.

[Ron Bibler]

In todays market a lot of escrows a falling out. And you get stuck with the paper chase. Trying to find the buyer. The Dude is long gone.

I hold the real estate agent up for the insp fee. I GOT HIS NUMBER.
Most agent will take care of us inspectors, and a like.
And do charge a billing fee to escrow. I have more open escrows now in this market then i have ever had before.

Get the green up front is always best.:D

Best

Ron

[Billy Stephens]

Get the green up front is always best.:D

Best

Ron

Always a Sure Winner.

[Leigh Goodman]

What about our ethical situation. Do we want to create even the appearance of a financial stake in the out come of the sale? Would that be something a lawyer might bring up if (s)he were trying to show that you left something out of the report to the detriment of the plaintiff.

That is what I tell them when they ask me to wait until closing. " I have a strict code of ethics which prohibits me from having a financial stake in the outcome of your transaction and I want you to be sure that my report would not be unduly influenced buy a fear that the sale would not close."

[Scott Patterson]

What about our ethical situation. Do we want to create even the appearance of a financial stake in the out come of the sale? Would that be something a lawyer might bring up if (s)he were trying to show that you left something out of the report to the detriment of the plaintiff.

That is what I tell them when they ask me to wait until closing. " I have a strict code of ethics which prohibits me from having a financial stake in the outcome of your transaction and I want you to be sure that my report would not be unduly influenced buy a fear that the sale would not close."

As long as payment is not contingent on the closing of the sale, it is not a problem. Payment is still expected regardless if the sale goes through or not.

Best way to accept a payment at closing is to get a CC or a check deposit for the full amount of the inspection. Let your client know that if you do not have payment within X number of days after closing that you will charge the card or deposit the check.

Bottom line is that you can't be scared to ask for the payment. I have seen it way too many times that newer inspectors are almost ashamed or scared to ask for payment. If you don't ask, you ain't going to get it!

It is simple all you have to say is this; "How would you like to pay for the inspection?", it is so simple yet folks are scared to ask for their money!

[Randy Aldering]

It is best to collect your fee when the work is done. It keeps things very tidy, closes some potential legal loopholes that may leave you vulnerable, and generally improves the bottom line.

[Ron Bibler]

I think some big Q. is why are they asking you to bill escrow?

1. they dont have the cash. Why ?
2. they have a 1031 and need to for taxes. Why ?
3 they just dont have a check with them. Why
"Sorry it slip my mind" This can be the first lie. Why ?
4. They need you the inspector to float them a loan. Why ?
5. They like to pay a billing fees. up to $ 100.00 extra. Why

Dang this is like a bad movie. know the ending way to soon.

Get the cash up front.

Best

Ron

[Erby Crofutt]

I had a problem asking for payment when I started. Now I make sure to tell them upfront when booking the ispection:

"The inspection fee is xxx.xxs which is due at the time of inspection. You can pay with cash, check or credit card, whichever you chose."

At the end of the inspection its:

"Do you have any more questions or is there anything elese you want me to look at?"

"Okay, that just leaves the payment. Will it be cash, check or credit card?"

Seven years or so. Stiffed once with a bad credit card # and unable to contact the client at the info she provided. Ah well, she probably needed it more than me.

[Steven Meyer]

POORLY!!!!!!!!!!!!!

[Jerry Peck]

Re: how does bill to escrow work
POORLY!!!!!!!!!!!!!


Finally!

Someone with my same thoughts. :D

[Rick Hurst]

Jerry,

I was going to describe it like this.

Have my personal address put on all your HI invoices. Tell your clients to mail their payments directly to Rick.

Call Rick at a latter date and ask where is your payment for the home inspection you performed.

Rick avoids you. :)

Rick has caller ID and recognizes your follow-up calls. Your on ignore list.

[Dave Hill]

You better consider that you may not get paid if you go this route (bill to escrow). I'm currently trying to get money from a deadbeat that couldn't get the house - walked away from escrow, and my bill. I'm considering using a collections agency, and/or having a lawyer draft a letter mentioning small claims court if I don't get paid for services rendered.
Times are tough, but we still deserve to get paid! I probably will not do another bill to escrow, I can't afford working fro free, can you?

[Steven Meyer]

Cash takls, the rest walks!!!!

It took me months to get my money, as escrow had "lost" my billing, and escrow was closed, money distributed.

Who paid me???? The escrow company, it was their error.
Took them to small claims court.



You better consider that you may not get paid if you go this route (bill to escrow). I'm currently trying to get money from a deadbeat that couldn't get the house - walked away from escrow, and my bill. I'm considering using a collections agency, and/or having a lawyer draft a letter mentioning small claims court if I don't get paid for services rendered.
Times are tough, but we still deserve to get paid! I probably will not do another bill to escrow, I can't afford working fro free, can you?