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Charging for a new certifcation
Posted by Larry Best on February 16, 2017 at 7:05 pmI finished an ALTA on a commercial property 3 months ago. Took 3 months to get paid. There’s a recent history of threatened litigation on the boundaries of the property. I listed over 50 encroachments. My customer asked for a new certification. I sent out a proposal for 50% of the original fee. The customer is not happy. It’s further complicated in that my office is on the property and the customer,who might soon be my landlord threatened to throw me out. What do we all think?
Unknown Member replied 7 years, 7 months ago 12 Members · 11 Replies -
11 Replies
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The thought of having a landlord is why my office is at my house.
You probably need to sit down with the new owner and negotiate your business relationship.
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Half the original fee after only three months seems a little high, but more to the point, never give your clients the impression you are sticking it to them, because they don’t like it. I would have included an explanatory note justifying the fee.
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Since you do not say, I assume the New Certification is to remove many or all of the encroachments’
Your fee quote may be too low and you may want 100% up front, plus cost of moving.
Paul in PA
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Larry Best, post: 414425, member: 763 wrote: It’s further complicated in that my office is on the property and the customer,who might soon be my landlord threatened to throw me out. What do we all think?
Sounds like a dangerous conflict of interest.
I can understand charging for the new certification. I would also require payment on delivery due to previous slow pay experience. If the only change to the plat is the new wording, I would think 50% is excessive.
Regardless of all of that, the fact that your services are being “complicated” by other business arrangements (your rental), I think this is a conflict of interest and it sounds like it always was.
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The ALTA standards have no provisions for ‘update’ or ‘recertification’. If the new parties want a map with different names (and more importantly a new date) there is work to be done. At the very least you add the new title repoet and summary, check for changes in the record, zoning, field conditions and monumentation. I also run through a complete checklist on the map. The only thing worse than certifying a mistake is certifying it twice.
After that I get paid for my time, liability, aggravation and product value. The client understands all this before we start work and it’s not a problem moving forward. If they started with threats I would give them one chance to calm down. There is too much work to put up with that. -
I think 50% off is a great deal, to good of a deal in fact, I would have charge at the least 80% of the original price, and if he didn’t like that he could hire another company and pay the full price.
Why is the job worth 50% less than it was 3 months ago?
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Larry Best, post: 414425, member: 763 wrote: I finished an ALTA on a commercial property 3 months ago. Took 3 months to get paid. There’s a recent history of threatened litigation on the boundaries of the property. I listed over 50 encroachments. My customer asked for a new certification. I sent out a proposal for 50% of the original fee. The customer is not happy. It’s further complicated in that my office is on the property and the customer,who might soon be my landlord threatened to throw me out. What do we all think?
What do you mean by a new certification? If it were simple revisions to the wording 50% would be way excessive but if it were a change in the parties of interest, specifically the owners, by all means 50% is more than reasonable as you are now extending your liability to a new client and essentially releasing a new survey.
I personally do not like doing ALTA surveys as quite often the Attorneys and Title review people do not fully understand what they are reviewing and I often end up battling with Attorneys when I refuse to certify anything above the scope of the contract or the standard ALTA wording required. -
If you are certifying to new players then anything under 100% is a bargain in my book. If on the other hand you are making changes based on an updated title report and all of the players are the same I would say 50% my be on the steep end. No matter what, given the fact that they took so long to pay the first time I would demand payment on receipt and add a reasonable amount (~5%) to make for the late payment.
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If it’s the same customer, I would say that 50% is a little steep for a re-certification only after 3 months. Our clients often go through a big financial process and we may change potential lenders multiple time and different entity names. Sometimes it takes 6 months or more to close. If its more like a year then i would consider charging more to allow for time to verify site conditions. Be clear as to what you are certifying to. Surveyor Notes are the key,
For an ALTA survey just simply make it very clear that the map is based upon a survey performed on a certain date, and leave it that date until the time you go back out to verify the current conditions. As long as you satisfy all ALTA requirements and If the Owner, Lender & title company are comfortable closing with the date of survey then all is good.
We also make sure to include a Time and Expense line in our contracts for additional fees for satisfying client/attorney comments / or additional items..
On a side note, sounds like you may want to consider moving, Especially if they would threaten you over the cost of a survey… 🙂
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[USER=763]@Larry Best[/USER]
I’d move now. However I would suggest reviewing your lease, rental agreement etc. prior to moving.
As a side note, I’m sure relocating in your area is expensive.
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