By Christopher Hoeffel, President CoreVest Finance This article originally appeared in Scotsman Guide. The commercial…
By Adam Luray, Analyst
For investors, a title is paramount. It ensures that they receive a clean deed of ownership on real property as they enter the closing table. Companies who issue these titles provide assurance to a property buyer and their lender that there are no outstanding liens and that all other claims of ownership from the past are removed. Title companies also require insurance in order to protect both the owner and lender from legal disputes that may arise.
What other additional benefits can title companies provide for real estate investors?
1. Property Information
Thanks to assistance from a title company, investors can gather useful property information that aids in identifying potential investment opportunities. Title companies can offer valuable data, such as addresses, names, and sometimes phone numbers for properties you may be interested in buying. You can also obtain information regarding property age, the length of time the current owners have lived there, absentee ownership, and which properties have less than a certain amount remaining on their outstanding loans.
This could be useful if, for example, you specialize in purchasing assets 20 years or older and plan to renovate them to attract rents more in line with the current market.
2. Deal Sourcing
Many title companies have departments whose sole purpose is to help real estate agents and brokers gain more deals. It is advantageous for title companies to help investors pinpoint new properties in order to provide their services again come closing time. It is a win-win situation for all parties involved.
Keep in mind that title companies, as with many other facets of the real estate industry, are extremely relationship driven. Not all title companies operate in the same way, so it is important for investors to find one in which they can build and develop a symbiotic relationship. This will help investors source more deals while working with a single firm versus using different ones for each property they acquire.
3. Peace of Mind
As the market for investment properties continues to thrive, some investors and homebuyers have increased their risk appetite by opting to avoid using title companies altogether. This typically occurs when an investor wants to move as quickly as possible to lock down a property, especially if he or she believes it may not be on the market for very long.
Newer investors may ask, “How often does a title issue actually arise, anyways?” They may never have experienced such issues in their own transactions. The reality, however, is they do occur. Experienced investors who have gone through the battle of unexpected tax liens on a property can attest to the level of inconvenience that this type of discovery brings.
At the end of the day, title and title fees are a small but important part of the real estate investment process. They provide peace of mind and prevent headaches and potential loss in the future.
Regardless of your investment strategy, CoreVest is here for you every step of the way. Allow us to become part of your team, as your preferred lending partner. For more information about how CoreVest can help you grow your rental business, please call Adam Luray at 917.633.9204 or email email@example.com.