When most people think about title companies, they don’t see them as resources. Most people don’t even know what title company does because title companies don’t advertise their services. Do you know a title company or title representative? Probably not.
Let’s look at the purpose of title companies, then get into what they can do for you as an investor.
A title company looks over the title history of a property to ensure that when title is transferred (property bought or sold), all liens and other claims of ownership from past owners are taken care of and removed. Liens can include past due property taxes, unpaid contractor fees, etc.
Title companies also ensure their work. The insurance covers problems and legal fees that arise if there were still liens or claims of ownership that weren’t taken care of.
Lastly, once the transaction is complete, they put your name on the title.
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What Title Companies Can Do for Investors
Being a title representative is a competitive business just as with most real estate activities. While they don’t go and put out ads and commercials — let’s face it, they would be very boring — they do still need to market to get business.
A title company markets by providing services, information and just all around help to real estate agents. The more business a real estate agent does because of a title company, the more referrals the title company will get. If title companies can help real estate agents, they can also help real estate investors.
Some of the services I use title companies for include:
Access to Property Information
My title rep sends me names, addresses and sometimes phone numbers of properties my clients or I want to buy. You can ask for only properties of a certain age or in a certain area, properties with a certain number of years that the owner has lived there, properties with absentee owners, properties with less than $X left on their loan (not very exact), etc. They have a lot of data they can use to identify properties you might want.
If you want to find seller financed properties, you can use title companies to get addresses for only properties that are paid off. If you want to find houses likely to be for sale soon, then you can ask for owner-occupied addresses where the owner lived there between 7-10 years, because this is the average timeframe that people start thinking about moving. You can also drive around looking for properties and pick out the ones you like, and the title company will get you the contact info and addresses of the owners when the owners live somewhere else.
Most people don’t realize there is an advertising budget for title companies. However, they use it to help those that send them business. The law forbids them from paying you for sending them business, but they are allowed to print out mailers, pay for postage or help pay for other advertising, as long as the money is only going to good and services and not into your pocket. The possibilities are endless.
Maps & Marketing Materials
They have maps and different marketing materials they give to real estate agents to better prepare them for working in that market. These resources can also be helpful to you.
Title companies also give classes on a lot of different aspects of real estate that you might be able to attend.
Title companies have departments whose only jobs are to help real estate agents get more deals. If you’re looking for properties yourself and you can give the title company business by using them when you find the properties, they just might help you too.
One thing to keep in mind is not every title company and every title rep are the same. I’ve had some representatives tell me they can’t get contact information, while another at the same company has done it.
If you want to find a title rep to help you, I suggest calling a few in the local area and letting them know what your plans are and that you will use them if they can help you get business. Then, ask them what they can do for you. You want to work with someone you like and someone that’s going to help you. It’s best to build a mutually beneficial relationship over time. You can’t beat that.
Investors: Have you ever used your title company for any of the above resources? Anything to add to the list?
Be sure to leave a comment below!