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Inflating Invoice
Doing small boundary survey and I agreed to have it paid from the closing of sale of the property. Client (seller) asks me to send him invoice so he could submit it to the title company. Normal so far. Buyer had called and asked some questions and told me he was paying half the survey and wanted to know the cost which I told him. So I emailed the invoice. Get a call from the title company and the buyer at their closing. Buyer wanted to know why the invoice was for almost twice the amount. I told him it wasn’t. So I forwarded the original email and invoice to them. Interesting eh? Midnight cut and paste I suppose!
Another first for me. Wonder if I would have received the extra money it the altered invoice was accepted. How was that going to work out for the seller’s advantage?
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30 Replies
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Paid at closing seems risky. What if there is no closing? Does your contract still require the owner who didn’t sell to pay you?
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Paid at closing seems risky. What if there is no closing? Does your contract still require the owner who didn’t sell to pay you?
I just OK’d being paid from the closing funds that was scheduled. I would still require payment if it didn’t close. I don’t work like a real estate agent that I get paid only if they get paid.
It’s closing today and they (title officer) told me my payment would be sent tomorrow.
It’s not my SOP to get paid at closing but if the timing works I’ll accept it that way some times.
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The company I work for also works this way, the only thing we wait to do until after closing is setting corners. Is it really that uncommon?
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I think it’s fairly common to be paid at closing. Back in the day when I did more residential stuff, I was paid at closing a lot. Sometimes you had to carry the invoice for quite a few months, but not a big deal. Usually small amounts of money.
That being said, it’s considered highly unethical (and in some jurisdictions illegal) to require payment only if the sale goes through. But nobody here is doing that anyway. In cases where a property didn’t close, I required payment from whoever ordered the survey–real estate agent, bank, owner, etc. They always came through.
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Payment at closing is a serious conflict of interest for a surveyor whose payment is dependent upon that closing. More surveyors around here have been played for the fools they are by agreeing to those terms.
Just say no.
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Payment at closing is a serious conflict of interest for a surveyor whose payment is dependent upon that closing. More surveyors around here have been played for the fools they are by agreeing to those terms.
Just say no.
Payment IF closing is unethical or illegal because it gives the surveyor incentive to not report issues. Payment AT closing does not pose that problem, but does add risk or delay to the collection of the fee.
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I think it’s fairly common to be paid at closing. Back in the day when I did more residential stuff, I was paid at closing a lot. Sometimes you had to carry the invoice for quite a few months, but not a big deal. Usually small amounts of money.
That being said, it’s considered highly unethical (and in some jurisdictions illegal) to require payment only if the sale goes through. But nobody here is doing that anyway. In cases where a property didn’t close, I required payment from whoever ordered the survey–real estate agent, bank, owner, etc. They always came through.
To be more clear, I should specify that we do send out a waiver that we will be paid by the signer, regardless of whether or not the closing occurs.
“…for services performed regardless of circumstances that may arise, including delay or failure to close on property.“
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I’ll allow a few to go this way each year. Sometimes its a month or two later than everyone expected. Not too bad if you are working with more than just the seller or buyer. Talking with the others (lender, realtor, title co.) helps greatly.
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Most of my papers are sent directly to the closing agent at the Title Company or other institution.
By law they must payout from the sell of the property or any escrow funds they are in control of to the people that they hold statements that require any payments before they can complete the transaction, if not they are in violation of their position and could lose their license.
When a property does not make it to closing, I still have the original of the survey order that was sent from the person responsible to pay for the survey.
A closer will send out payments when the money has funded, has been deposited in the correct accounts by the bank or other loan agency or from cash escrow.
All the people involved from one end of a property sale to the other is regulated by some BOR and I have contacted them all before concerning a few highhats that thought they could make their own rules.
Their BORs have swift justice and carry a very big stick.
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Payment at closing is a serious conflict of interest for a surveyor whose payment is dependent upon that closing. More surveyors around here have been played for the fools they are by agreeing to those terms.
Just say no.
I disagree. Payment at closing and payment if closing are two vastly different things. I can only remember 1 time in the 18 years I’ve been here when we got stuck over a deal that didn’t close.
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when we bought a property we had to pay for the appraisal up front, no waiting for close of escrow.
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You make the Invoice out to whoever ordered the survey. Agreeing to get paid at Closing has no effect on whether you’re going to get paid or not. All my experiences have been Closing is within a week of filing the survey. It actually expedite payment. The Title Company will make sure all the bills get paid.
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Paid at closing has been quicker than most payments for me. I’ve never had an issue with it, it works better that way. Usually it’s for a large parcel, not house surveys.
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Payment at closing is a serious conflict of interest for a surveyor whose payment is dependent upon that closing. More surveyors around here have been played for the fools they are by agreeing to those terms.
Just say no.
I disagree. Payment at closing and payment if closing are two vastly different things. I can only remember 1 time in the 18 years I’ve been here when we got stuck over a deal that didn’t close.
We can disagree and do so civilly and I still believe that payment upon closing incentivizes the surveyor to not report or show a problem as doing so will likely jeopardize the closing and thereby putting the whammy on your payment.
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Payment at closing is a serious conflict of interest for a surveyor whose payment is dependent upon that closing. More surveyors around here have been played for the fools they are by agreeing to those terms.
Just say no.
I agree with that. It’s a basic PS test ethics question. Payment at closing means no closing, no payment. That’s a clear COI.
Now, if you choose to let the client slide a little, and ultimately and coincidently get paid just after the time of closing, that’s your business. But no way I’d put any paid at closing terms in writing.
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@ Just a Surveyor
Many people are only selling their current residence because they can not afford it or anything else for that matter and without the funds from the sale of the property they would lose everything they have.
What you are thinking of is what many people, bankers, attorneys and real estate people want, a no fault system like they live under where when the deal sours and goes away, nobody is out any money.
The labor laws that are on the books were written for instances like this and to give notice to the cheap lying stealing people that think they don’t have to pay for your work.
There is a term for what you are referring to and I believe it is “no fault” or something to that area of thinking.
In Texas or any other place for that matter, it is a practice that is hardly ethical by any professional involved in any real estate transaction, survey or whatever.
When a client insists upon picking up the papers themselves before closing, they pay me then or I send it to their closing agent.
0.02
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Payment at closing means no closing, no payment.
Not so. Although I never write “payment at closing” into my contracts, I love it when the client or title company requests an invoice be delivered into escrow, as it means I get paid sooner. The contract is in force no matter what, I don’t care who writes the check. If the deal falls out of bed I still have a contract that I can enforce.
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Client asked me for the invoice so he could have it paid through the closing. Invoice was due on receipt. No contract for “paid at closing”. Just finishing the survey so no time lost here.
Apparently client though they would pay him for the survey and then he’d pay me. I never thought that, been paid a few times from a closing, know how it works. So he rewrites the invoice someway and sends it in. I should have got wise when I asked if I should send it to the title company and he said just send it to him and he’d get it to them. I didn’t even know what title company it was.
Buyer got wise. If not I’d got a bigger payment from the title company. Wonder if he’d then asked me for a refund. Probably was an interesting day at the closing.
Might be good it happened this way. If the title company had paid him this sort of guy probably would have tried to stiff me.
You guys are a tough bunch today, sort of wish I’d kept this to myself. I think I still have my license but you never know!
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One time the real estate agency paid me out of the earnest money when the sale failed to close. Only one time in 30+ years where the closing agent had to do that.
On the other hand I have had plenty of clients who never got around to paying the invoice until they had the money to do so, which was after closing.
One time I had a fellow call to find the corners I had set a couple years earlier for a different fellow. Turned out this was the buyer from that sale. He had merely speculated on the tract and was selling it to someone new who had insisted they wanted to see the corners before closing. Somewhere in the conversation he commented that he thought my bill from earlier had been too high. The client had paid me in full, so I didn’t see what the problem was. Turns out my client had modified my invoice to be exactly double what he had paid me. When they split the modified invoice he got every penny back. To tell the truth, I was amazed the client had enough intelligence to figure out how to do it and not get caught. He was one of those guys I would describe as being “as sharp as a stick of butter”.
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It has become necessary to create a document that has some security items that can not be scanned and recreated, altered and such for a long time.
A unique design, coloring, watermark or some embedded pattern that can not be captured and reprinted.
I get drawings and property descriptions of mine and others from clients and interested parties that are incomplete and do not contain the proper preamble or closing statements. Also, use a specific way of saying things that most people can not grasp using and still relay a completely understood description.
I have had to pull out the original many times dealing with shady people that try to get away with altering my work to suit their own desires at the title company and to new buyers.
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