During a conversation with a friend of mine who has owned and operated title companies throughout northeast Ohio for the past 20+ years , he shared with me a couple of key points of which most real estate investors need to be aware. The goal is to make their experience with a title company faster and smoother. Instead of looking for an investor-friendly title company, become the friendly investor with whom the title company wants to work.
1. Make sure your purchase and sale agreement is legible and fully completed, including all relevant contact information for all parties. Do not omit phone numbers, addresses or email addresses.
2. Check to see that your entities have been properly established and that you have created and executed your Operating Agreement or Trust Agreement. You must also have a tax ID letter from the IRS for your entity. The title company will be requesting all that information, and it’s important that you are able to send it to them in a timely manner when asked.
3. Save yourself a headache by spending a little money at the front of the deal and ordering a current owner lien search or an O&E to verify that you are dealing with the correct parties and that there are no obvious issues with the title, such as a deceased family member, tax liens, a pending foreclosure, judgment liens, etc. Don’t wait for the title company to do this a week or two before closing. Do it at the beginning of the deal. Obviously, if the deal moves forward, you will get credit at closing for what you spent on the current owner lien search when you close the transaction with the title company you used to get the title exam.
I hope these suggestions help you be the type of investor that title companies look forward to working with.
