Late Payments

PSAs and News
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This is just an FYI for all us CNSAs…I contacted our Texas governor about us not getting payments anywhere from 30days-a year in some extreme cases. I explained the whole process to include how title companies are funded that day or the day after and that this is not fair when a regular employer have labor laws they need to follow when it comes to payment. I asked if there is something he can do to laws governing this funding from 3rd parties who contract us.

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That’s not exactly true - “title companies are funded that day or the day after” - the situation depends on many different scenarios.

…if a refi, 3 business days must go by from signing date before funding can occur;

…if you are named on the CD then the payment is issued at funding;

…if you were contracted directly by title and NOT named on the CD, you may be paid from their operating account, which may be paid when their accounts payables are paid;

…if you were contracted with a signing service, title pays them on their arranged schedule and then you have to wait for SS to pay you on their schedule…which could be anywhere from 2 weeks to 3 months.

Many factors in consideration here and not all in the notary’s favor - best thing is just know the system and the payment schedule of the particular hiring party.

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@cheryl_1_angel The following are a few general insights regarding the management of Accounts Receivable transactions within this business sector. These are not necessarily in order of priority . . .

  • ALWAYS submit an invoice directly to your client; that is, unless they’ve specifically identified that one isn’t necessary.

Of course, you’ll want to follow that account across the ‘maiden voyage’ to ensure that business entity DOES pay without receiving an invoice directly from you. After that confirmation of successful payment, continue to monitor receipt of payments.

  • DO keep an abbreviated payment turnaround interval.

A reasonable payment timeframe with a Title/Escrow Company [T/EC], Attorney, etc. is 5 to 7 calendar days.

For Signing Services [SSs], 7 to 21 calendar days.

NOTE: Some SSs issue checks/Automated Clearing House [ACH] payments on the 1st & the 15th of each month. As such, their payment interval may be a bit longer than noted above.

===>>> Anything longer than the intervals noted above is considered an EXTENDED interval for payment.

If you decide to accept longer intervals, in essence, as a business owner you’ll be extending credit/giving a non-interest-bearing loan. Certainly, NOT the best use of your funds/return on investment [ROI].

Please research the business entity & their affiliated reputation PRIOR to providing any Professional Services.

===>>> Remember that for the Professional services you provide include associated ACTUAL DIRECT out-of-pocket expenses that become a financial liability you’re incurring for that specific SO; i.e., gasoline, turnpike/ferry fees, paper, toner, binder clips, pens, envelopes, hand sanitizer, wipes, etc.

Many of us have a PAYMENT POLICY & identify those requirements when accepting Signing Orders [SOs] from a new client. That is normally one of the non-negotiables during the SO Acceptance discussion. Here is an example of a payment policy:

“Fee is due and payable for services rendered at the time service is provided - regardless of/not contingent upon borrower(s) signing, the loan funding status, or the purchase/sale/refinance finalization status.”

The PAYMENT POLICY STATEMENT is also included on each invoice for every client.

REMEMBER that your out-of-pocket expenses are promptly due (whether cash payment or credit card) immediately or within 21-25 calendar days (per credit card statement).

Ergo, you owe it to yourself to ensure that your CASH FLOW is available within that timeframe.

Want to learn how to Create your own individualized Schedule of Fees? Review this Notary Cafe thread.

Always remember to make an important distinction when asking about payment turnaround time during the negotiation interval:

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  • “Is that 21 Calendar days? Or, 21 Business days?”

When doing the math, it reveals there is a much longer turnaround time for payment with the Business days counting ‘method’ . . .

  • Trust (but verify).

Always vet a client PRIOR to the initial transaction. Ask “What is your payment interval?”

Be certain that you confirm the interval is in calendar days or business days as there’s a LARGE difference between the two . . .

Accept the SO if it meets your criteria and add the caveat that you’ll be researching their business regarding payment history & may need to return the SO to them if there are concerns about prompt remuneration of successfully provided Professional Signing Agent [PSA] services..

  • Remember to always keep notes about the payment interval agreement.

  • If you have a NEW client with one outstanding invoice, hesitate on accepting additional SOs until payment is made.

WHY? Often, business entities that have a “sketchy” history of paying PSAs, they’ll often schedule MULTIPLE SOs close together. Before you know it, you have a NEW client with 5 or 6 outstanding invoices! Non-payment could result in financial difficulties . . .

  • Be Professional.

  • Remain calm.

  • Don’t respond to ad hominem attacks (nor reciprocate).

  • Take legal action when all else fails . . .

:swan:

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