A Dispute Over Escrow Firm’s ‘Rush Fee’

What is a fair price?

If you’re buying fruit at the peak of the season, you know pretty much, depending on the quality, what a pound of plums should cost. Same thing with having laundry done, or taking a bus downtown.

But if you’re doing something that for you is highly unusual, such as buying a condo, perhaps a once- or twice-in-a-lifetime venture, how can you be certain what the escrow fees ought to be?

Services such as these--the acting by a firm as a clearinghouse to be sure payments are made properly and to handle paperwork--can lend themselves to add-ons that may be exploited against a consumer’s interests.

In this case, Anita Winkler of Los Angeles is convinced that she was overcharged by Nettie Becker Escrow Inc. of Beverly Hills when it billed her $1,350, including $250 in “rush fees,” for closing the escrow in just nine days on a $204,000 condo near the Beverly Center that she purchased in May.

Winkler had deferred to the escrow choice of the seller’s real estate agent, a Coldwell Banker office with the same Beverly Hills street address as the Becker firm. She asserts that, by the time she found out that the escrow charge was going to be twice what she had expected and what her lender had indicated it should be, it was too late to go elsewhere without losing her locked-in loan rate.

Winkler has complained far and wide, asking the firm directly for a reimbursement of some of this amount, and approaching The Times, a television station, the state Department of Corporations and the Los Angeles County Department of Consumer Affairs, among others, for assistance in the matter.

“It really bothers me that one cannot trust even the people who are supposed to make sure real estate transactions close properly, escrow officers, and that, with all the government offices we have, none appears to be able to assist me in obtaining a refund,” she e-mailed me on July 23.

Winkler has certainly gotten the attention of Nettie Becker, owner of the firm, and escrow officer Mark Fishman, who primarily handled the matter.

They say they are acting on principle in refusing to give any refund.

As Fishman put it, “If you call me at the outset and ask if I can do an escrow in nine days, there’d be no rush fee. But in this case, where she initiated a change at the last moment, and I had to drop everything to accommodate her, then I feel the rush fee is justified.”

In one instance, Fishman reported, an employee had to come in at 5:30 a.m. to get out all the papers that Winkler needed.

Still, Winkler persists, and by now, Becker and Fishman are fed up. Becker said she had instructed her attorney, Ronald Altman of Brentwood, to send a letter threatening Winkler with a lawsuit for defamation if she keeps accusing the firm of overcharging and abuse.

Altman said such a letter was going out Wednesday by certified mail.

Winkler responded: “I think it’s terrible that they would try to sue me when I’m the victim of all this. I don’t have the money to pay lawyers to try to deal with that. . . . I’m frightened.”

Altman insisted there is no truth to Winkler’s assertion that she was overcharged, and said the continued airing of such charges could stain the Becker firm’s reputation.

Becker says her firm is competitive in its pricing. “I’ve been in business for 20 years,” she said. “I never wanted to be the lowest priced or the highest.” But, she went on, her firm doesn’t charge for extras that other firms do charge for.

Maybe so, but my own survey of several firms in higher-priced areas of the Southland indicated that Winkler’s $1,350 bill was higher than other escrow offices said they would have charged. Of four firms surveyed, none said their charge would have exceeded $1,000.

The vice president of the real estate firm that represented Winkler, Elsa Nelson of Nelson, Shelton & Associates, who has unsuccessfully tried to arrange a partial refund for her, was categorical in asserting that there was an overcharge.

“I have never in my 22 years managing a real estate firm seen an escrow company charge a rush fee,” she said. “This bill should have been $650, max.

“The going price is anywhere from $1.50 to $2 a thousand, plus a minimum fee of $200 to $250,” she said.

However, my own survey, with firms that did not want to be quoted by name, indicated that quite a few would have charged a loan tie-in fee (as Becker did) and some would have had extra charges for paperwork. That pushed up their prices into the $900 or $1,000 range--still below what Becker charged.

Again, these firms were in affluent areas. Escrow fees in outlying parts of Southern California might well be even less.

There are other aspects of the dispute between Winkler and the Becker firm.

Winkler is deaf and suggests she may have been discriminated against, saying, “I find that people sometimes assume because I cannot hear well, I am also short on brains and can be taken advantage of.” Becker and Fishman sharply deny such discrimination.

Fishman also mentioned that the loan papers revealed that Winkler is an employee of the Internal Revenue Service. He said that while she had never mentioned this to him, he still felt that, if principle were not involved, it would have been politic for the firm to make a refund. The fact that the firm is sticking to its position shows how right it feels it is, he said.

Winkler said any suggestion of an IRS role in the dispute was nonsense. “We have very strict conduct rules in the IRS against using our affiliation in any way in such matters,” she emphasized.

These issues may or may not be important. The likelihood, however, is that this is mainly a dispute over price.

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Ken Reich can be contacted with your accounts of true consumer adventure at (213) 237-7060 or by e-mail at ken.reich@latimes.com.