Posted on: March 04, 2020

The importance of working with the right title company cannot be overstated. Why? For starters, they can make or break a deal. In other words, they can determine whether you get paid or not.

With countless options available at your disposal, how do you choose the best title company to work with? That’s just one of the key questions today’s guest will provide an expert answer to!

In this episode, Wholesaling Inc’s newest coach Chris Arnold talked to Taylor Martinez, his director of closing. Taylor has helped Chris and his company close hundreds of deals and is considered an expert when it comes to titles.

Taylor shared so many gold nuggets in this episode—from the things she looks for in terms of staff down to her philosophy when it comes to working with title companies, she covered it all.

Knowing how important finding the right title company is, there’s no denying this is one of those episodes you just can’t miss!

 

MARCH CONTEST ANNOUNCEMENT!

For the entire month of March, Wholesaling Inc is running a Ratings and Review contest! We’re going to fly out 3 lucky winners to Florida, paying for airfare and hotel, to spend to full days with Tom Krol!

Whether you are trying to land your first deal or scale your existing Wholesaling business, Tom is going to help you crush your obstacles and achieve your goals!

And the lucky winners will all be featured as guests on the Wholesaling Inc Podcast!

To enter, you must Rate and Review the Wholesaling Inc Podcast on iTunes (5 stars please:) and send a screenshot of the Review to Darrin at darrin@wholesalinginc.com.

3 winners will be chosen at random and announced on the Podcast in April! Good luck!

 

Key Takeaways

  • Why the location of your title company matters
  • What a blind HUD is
  • How to gauge if a title company is more investor friendly
  • What to look for in a title company in terms of staff
  • Why having only one point of contact is ideal
  • How to know if a title company is willing to go the extra mile
  • Why working with multiple title companies is recommended
  • Two types of investor friendly title companies
  • Top 2 documents required to speed up the process
  • Her philosophy when it comes to working with a title company
  • The difference between contracts that come from radio versus other marketing sources

RESOURCES:

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Episode Transcription

Speaker 4:
Hey guys, before we get started with the podcast today, I want to tell you about a very special contest we’re running just for you, our listeners. I am so excited. So what we’re going to do is, we are going to fly down three people to spend two full days with me in sunny Florida, where we’re going to review either your wholesaling business, your current business, or we are going to work like heck to get you your first deal, and all you’ve got to do to earn one of those seats is so simple, it’s so easy. Just go to iTunes. I want you to find the Wholesaling Inc. podcast, and I want you to rate and review this awesome podcast that is changing so many people’s lives, and I want you to send a picture of that review to darrin@wholesalinginc.com. That’s Darrin D-A-R-R-I-N at Wholesaling Inc, Wholesaling I-N-C dot com.
Send a picture of that review and we’re going to choose three lucky people to come down to Florida and spend two full days with me. You guys, it’s going to be an awesome adventure. You can’t buy this seat, it’s only for reviewing the podcast. Thank you for your review. Hopefully we get five stars. Either way, I will see you very soon in Florida.

Chris Arnold:
I’m your host, Chris Arnold, and I’m excited about the topic and even more the guest that I have for you today. What are we talking about? Today we’re talking about the value of having the right title company and what it can cost you to have the wrong one. And there’s a ton of questions around title companies, what should I be looking for in the title companies? Should I have more than one title company? What can I expect? There’s a lot. And why this topic really is so important? Is because title companies can determine whether or not we get paid. I’m sure everyone listening has maybe had an experience in which they felt the title company potentially lost them a deal, and that is the worst way to lose a deal.
It’s one thing if we mess up, we can blame ourselves. But if a title company does something, then it’s like, “Wow, that’s really frustrating.” So the guest I have on today that I’m very excited about is actually my director of closing, who has actually been doing transactions and closing them out, coming up on six years. She has processed as a closing manager, or as we say director, hundreds of transactions, and there’s no one that I know around the country that knows more about title from a wholesaling standpoint than she does. So much so, that some of the top guys in the country actually asked to have individual conversations with her to pick her brain about how she does what she does. So Taylor, I’m excited to hang out with you today. Welcome to the show.

Taylor:
Thanks for having me, Chris.

Chris Arnold:
Awesome. Tell us a little bit about you. Where are you located? And just a little bit about you personally and on the business side so we can get to know you.

Taylor:
I’m located in Dallas. I live in Dallas. I’ve been with [inaudible 00:04:10] for almost six years and I started off as part-time with [inaudible 00:04:10] then graduate to being the closing manager and now recapping, I’m basically closing manager for [inaudible 00:04:23].

Chris Arnold:
Absolutely. And not only are you the closing director, you also have a closing person underneath you as well that you help manage as well. So it’s a two person team, correct?

Taylor:
Yes, it is.

Chris Arnold:
Awesome. All right, let’s get to the meat, right? Let’s talk about title companies and pick your brain about everything that you know. So one of the first things is like location. Does the location of your title company matter?

Taylor:
Oh, definitely. Depending on what market you’re in, whether that’s DFW anywhere in California or whatever state, whatever location, like for [inaudible 00:05:04] specifically, DFW having our title company local and having them know what’s going on, different things that are changing in the DFW area, having plugs for, let’s say for a tax information or certain people they can call to get us information faster, is always in your best interest to have your title company in the same market you’re working on.

Chris Arnold:
Okay. Absolutely. And that’s, again, you’re emphasizing that for the access to information that a local title company gets versus one that’s not local, correct?

Taylor:
Yes, definitely. They’re going to be more familiar, or comfortable working within that market.

Chris Arnold:
Yeah. Now let me ask you, this are all title companies created equally or are there some that are quote, more investor friendly? Is that actually true?

Taylor:
That is true. There are more title companies that are more comfortable just on the retail side of things. They’ll do their… a couple investor deals here and there, but then you have your other title companies that are way more experienced and investor friendly, and they have tricks up their sleeve and they can help you with information maybe you’re not familiar with. for example, when we first started, I wasn’t too familiar with something called a blind HUD and our title company that we started with that was pretty familiar with doing investor deals. They schooled me on, we can show basically your information on one HUD and then on the seller’s HUD, they won’t necessarily see how much you’re making per se. So that really saved us on a lot of deals.

Chris Arnold:
Okay.

Taylor:
Because of our profit margin.

Chris Arnold:
And so that’s… Wow. And so to define that if someone newer is listening, a blind HUD is your ability to actually hide what you’re making on a deal from the other parties involved, correct?

Taylor:
Yes, exactly.

Chris Arnold:
Perfect. Now to break that down. So what I hear you saying is there are some title companies that are built to work retail, which is with traditional real estate agents and brokers. And then there’s some that are built to actually work better with investors. Now, if I’m new to the game and I’m like, well, how do I figure out the difference? How do I know whether a title company works more with agents, or works more with investors, because if I call them, they’re probably going to tell me what I want to hear. So how do you actually know which ones are investor friendly?

Taylor:
You can ask them just how many, for example, how many investors do they actually work with on a day to day? Are they familiar, for example, with blind HUD’s. And simple questions like, do you disclose information about our assignments to your sellers? What kind of relationship do you have there? Do you have our back on that end or are you more like toward the seller? Which, I mean, it’s fine, but we also want to keep a sense of confidentiality when it comes to that and the buyers that we bring in. So just simple questions like that, just to kind of screen your title company, that’ll help a lot as well.

Chris Arnold:
Okay. Now another thing is diversity, right? A title company should have experienced dealing with multiple types of closings. What does that actually look like? When we say multiple types of closings, what are we talking about and the sense of diversity? How do we identify that in a title company?

Taylor:
And again, it comes back to questions and just screening the title company. Our title company, for example, is very familiar with retail transactions, but they’re also familiar with wholesales, assignments, dealing with multiple buyers at one time. And they’re also familiar with a lot of title issues, which is, because of the markets that we’re in, I see a lot of in, not only different title issues, multiple title issues within one transaction. So having a title company that’s diverse in just different types of closings and different title issues is very helpful.

Chris Arnold:
Yeah. I definitely agree. Because you know, as I do, particularly in Dallas Fort Worth where we’re at, I think you’ve seen just about every title issue there is. And most of those on a regular basis

Taylor:
Yes. On a regular basis, yes.

Chris Arnold:
That’s what makes what you do difficult. But, what has always been amazed with me is you’re at a point where you talk way above most of our heads in the sense of what you understand about title, because there is a lot that goes into understanding each of those title issues. So let’s talk about the actual staff at a title company, right? When I go in and I say, okay, this particular title company is investor friendly, but then I start to look at the particular staff that make it up. What am I looking for when it comes to staff? What should I be expecting them to offer me?

Taylor:
Honestly, I mean, there are title companies that we work with that are on a smaller scale. There’s three to four, maybe five people in an office, for the title companies that we work with, that there’s 13 to 15 people within their office. What we’re looking for though, as far as staffing wise or what we’re looking for specifically is not so much the number, but the attitude and the people that we can actually contact for our deals. So having a specific person to contact is a huge deal for me. Having somebody that I can go to on a day to day basis, be like, “Hey, I have to get an update for Sunrise Drive.” And them being able to reply within an hour, 30 minutes or an hour, that’s huge because I have so much on my plate.
Having those updates daily or every other day, it just helps me do my job that much better. And if that person is busy, having someone else in their place to be like, “You know what? I don’t have that file in front of me, but I can go grab it and just look at it and tell you where they’re at. And I can give you an update myself.” So not so much having… It doesn’t mean that the more people, the better, it’s just that having somebody that is committed to our contracts and then also having somebody else under them, assistant, whoever it is be like, “Okay, you know what? She’s not available, but let me help you with that update. [inaudible 00:00:11:32]. Give me 30 minutes I’ll have it right to you.”

Chris Arnold:
So the word I hear is somebody that’s dedicated to your files at the title company is really important, so that you have one point of contact rather than just calling in and just speaking to different people on that team. But at the same time, the team that’s behind your point of contact should also be able to step in as needed.

Taylor:
Yeah.

Chris Arnold:
And that’s what we should expect from our staff over at the title company. Okay. Now, what does it look like for a title company to go the extra mile? How do we gauge? And I’m looking for specifics here, I’m working with the title company and I want to go, how do I know they’re on par? How do I know, not even that they’re on par, but they’re really going the extra mile. What does that look like in your world with the title companies that you work with?

Taylor:
Again, it goes back to the communication and dedication that that title company has. So even, I test start title companies before we actually use them all the way. So for example, if I have one or two files that I give a title company to just go ahead and test them out, the updates, that’s something I’m looking for. If a title company’s taken more than an hour or two to respond to me, that probably means that I’m not top priority within their stack. And a good title company is, no matter how busy they are, are going to make time for you because they want your business. And then they actually care about your file. Take the time to be like, you know what? I’ll get to this real quick. Let me just update her really fast on what’s going on. It doesn’t take about five minutes.
So the communication, updating, and then for example, one of our title companies that we have right now, one of the head escrow agents, always, like when I say going above and beyond, we had foreclosures last month, two of them going on simultaneously, seven to 10 day close turnaround in a foreclosure, that’s really tough. And we had to get a payoff to the attorney so the foreclosure wouldn’t take place. It was a Monday foreclosures on Tuesday, first Tuesday of the month. And she actually went down to the attorney office herself to hand deliver the payoff so they could stop the closure.

Chris Arnold:
That’s a great example. So that’s an example of going above and beyond right there. Now, Taylor, you keep saying title companies, plural. My question is, do you put all of your eggs in one basket with one title company and try to just strengthen that relationship and just give them all your business. And you go in and go, “Hey, if you do a great job for me, I’m going to give you all my business.” Or do you go a different route and have more than one title company? What’s the better setup there in your experience?

Taylor:
Honestly, in my experience, you never want to put all your eggs in one basket. You always want to have multiple title companies, for sure. And at the same time, the reason for that being, the why you want multiple power companies, you never want them to lose that. You don’t want them to take you for granted. If your title company knows that you’re sending them all your business, they’re going [inaudible 00:14:34], we can basically slack off a little bit. I’m a firm believer that having multiple title companies helps us out tremendously because I feel that it helps build a healthy type of competition. So when the title company-

Chris Arnold:
Between the title companies, right?

Taylor:
Yeah, between the title companies-

Chris Arnold:
Because they know, hey, I got to fight for this a little bit.

Taylor:
Yes. They don’t back off. And that’s what I’m looking… and that’s what we need because we have such a heavy contract count and I have so many, I have so much on my plate at one time, even with [Alan 00:15:08] helping tremendously, she’s dealing with almost half the load as well. It’s still, having those two to three title companies. And I don’t ever lie. I don’t ever say, “You’re my only title company.” They know that there’s multiple title companies. And I think that’s helped us out tremendously because that lets them know that, Hey, we really appreciate you. You have our back, we love you. But at the same time, I don’t want them to slack off and take the fact that… I don’t want them to take our business for granted.

Chris Arnold:
Yeah. And I can remember in the past, when we, Taylor just had one title company, they would get a little bit soft. They would lose that sense of urgency. And then you would come in and go, Oh, we’re going to start moving a partial amount of these files over to this next A and BC title company. And all of a sudden they’d perk up. Right?

Taylor:
Exactly, they would.

Chris Arnold:
They started getting faster, [inaudible 00:16:03] better, all of that stuff.

Taylor:
They realize they’re losing business, yeah.

Chris Arnold:
Yeah. Keep them competing for your business. I definitely think that, that’s important as well. Now I’ve heard you also say that another great reason to have multiple title companies is that based on the title issue, that for instance, you might have one title company that does really well with X title issue, and another company that does really well with this different title issue. Is that true that you’re sending contracts to our different title companies based on the type of title issues, because some are just better at dealing with them?

Taylor:
Yes, it is very true. You do have title companies that specialize a little bit more. For example, when the attorneys in-house it’s actually easier to deal with, for example, like the IRS, tax liens or foreclosures, because you can ask your questions right then and there. When the attorney is out-of-office, like the fee attorney, it’s a little bit harder, the communication, because it’s going through the escrow officers. So having communication with the attorney, it helps a lot. And having title companies that specialize in certain, whether that be again like the foreclosures or abstract judgments or certain liens, it actually helps speed the process along that much more, and helps you with your closing time.

Chris Arnold:
Makes sense. So there are two types of investor friendly title companies. Those that the attorney on staff works actually in the office, they have an in-office attorney and then there’s other title companies that the attorney is out-of-office. Did I get that right?

Taylor:
Yes.

Chris Arnold:
And that can determine, based on where the attorney’s located, on how well they deal with certain title issues that would, I guess, require the attorney to be more involved to get that title issue cleared. I get that, right?

Taylor:
Yeah. So I mean, we have some title companies, their attorney is not in-office and they’re still really fast, it’s just me. I just feel more comfortable about my wording, my emails are going directly to them and that my point is getting across and I’m understanding what they’re telling me. And that helps a lot as well.

Chris Arnold:
Okay. And putting all this together, we run, if you haven’t read the book highly recommended called Traction and in Traction is what’s called EOS, which is the Entrepreneur’s Operating System. And that’s just a fancy way of, here’s how you should build out your team and your company. And one of the parts of Traction is that every person in your number, in your company or team member is responsible for a number. Term is, everyone gets a number or gets a metric that they’re responsible for. Now, your metric Taylor, that you’re responsible for in your position, is contract to close. Is that right?

Taylor:
Yes.

Chris Arnold:
Okay. Can you define what it means to have that number? What are we talking about when we say your KPI or your metric is contract to close? What is that KPI for you?

Taylor:
So we’re looking specifically at how long it takes from when a contract comes in, I received a contract from our acquisition manager, to when it’s closed out and funded, and we have our fee in the bank. So right now that number it’s between 23 and 24 days, and that’s been pretty consistent even last year. And so we’re trying to keep that consistent this year, or lower. We’re going to be trying to go lower than that.

Chris Arnold:
Yeah. So from the time a contract comes in, meaning comes into your hands until we get closed and paid as an organization is around 23 to 24 days.

Taylor:
Yes.

Chris Arnold:
Now if you’re listening and either you’re listening, going, I don’t really know that number because I don’t track it, or, I track that number and in no way is my number close to that. Do you mind Taylor, telling us about where we were, where we started before you really got this all systemized? How long was it taking us years ago to close these transactions out?

Taylor:
Ooh, on certain deals… I mean, it’s hard to believe, on certain deals, especially with like IRS liens and certain affidavit heirship issues, which were huge for us. And still, I mean, that’s a lot of our, our clients do you have a lot of affidavit heirship, which is basically just multiple people on… that have to be involved in the sale of the home that maybe they’re not necessarily, they know about, privy too. But as far as that number, when we first started, it could take up to 60 days to close those types of properties.

Chris Arnold:
And I can remember, I believe Taylor, correct me if I’m wrong, that our average contract to close at one point was averaging over 50 as a whole. Isn’t that right?

Taylor:
Yes.

Chris Arnold:
And you cut it in half over time, you and the team?

Taylor:
Mm-hmm (affirmative)

Chris Arnold:
Yeah. If you’re listening, that should give you a rabbit to chase. That, if you’re looking at your contract to close process, and again, the title company’s a part of that, again, I know there’s other variables, but it does give you a sense that if you have a well oiled closing process, it should on average be about 23 to 24 days. When you take all of your contracts each month, how long it took all of them to close, and then you average that number up to come up with the true average. Now, another question, what are a couple things that you actually take responsibility for to send a title company documentation in order to speed up that process? Again, I know there’s several, but what are the top two things that listeners might go, “Hey, I need to know what can I help to do to speed up that process?” Do you mind touching on two documents that you make sure they have in their hands, right when the contract is sent over to them?

Taylor:
Right when the contract sent over, we definitely require the seller’s authorization, which basically gives the authorization to the title company to request information on the seller’s behalf. So any kind of liens with the city, any kind of judgements, whatever the case may be, mortgage payoff with mortgage companies, those types of things, you’re going to need 99.99% of the time. The [inaudible 00:22:45] holder is going to require that seller’s authorization. And it’s usually just a one page form. And the seller is [inaudible 00:22:51] signing off thing. They give permission to the title company to request that on their behalf. And the next-

Chris Arnold:
Do you get that signed, or does the acquisition manager get that signed?

Taylor:
The acquisition manager gets that signed, but we make sure… If the acquisition manager does not have that, which sometimes it happens. It’s usually required when they submit a contract. I have to have that piece of paper because it’s so important. [crosstalk 00:23:18]

Chris Arnold:
… the one I hear you saying like, if you were to 80/20, this, if you’re going to get one document signed at the time of contract from the seller, get the seller’s authorization signed and sent over to the title company, along with the contract, right? That’s the big-

Taylor:
Yes.

Chris Arnold:
What’s the second one to that would you say?

Taylor:
The second one to that would probably be the seller information. And that basically is a, it’s just a one page paper with just their basic information, last four as their social, their ID number, the driver’s license number. That information is super important because we’re dealing with a lot of information here. And when the title company gets the commitment back and they see all these different names, people have really common names like John Smith. I don’t know how many liens could probably pop up on that title, but having that information right there is going to cancel out more than 50% of the nonsense that’s on the title commitments. So we don’t have to deal with that, and we can just actually focus on what’s actually needed to secure a title.

Chris Arnold:
So do you take the mentality that the title company should do everything on their own? Or do you see it more as a partnership between you, as the director of closing or closing manager, and the title company? Because I know some people are very hands off. It’s like, well, the title company should just deal with all that. And I just send it over and just send me a check. Where others would go, there’s more of a partnership. What philosophy do you take when it comes to working with the title company to get the best results?

Taylor:
There’s definitely a partnership. I am very involved in the title process, probably more than I need to be, but that also guarantees that we’re closing things on time, and that I have appropriate updates. Because one thing I’ve learned working here, and for so long is, things can change within an hour. So having that communication being so hands on being involved for much, I mean, in my world, it pays off. And it pays off for us, because it really helps me keep a grasp on what’s needed. For example, if the title company is just like, “We just can’t find this person.” I can’t tell you how many times our team is like, okay, we’re having like a brainstorm session and we’re going to figure out how to find this person, whether that be through Facebook or research, we’re going to find this person. And we do, we end up finding them, calling them and as impossible as it seemed to cure that title from one day to the next, they’re ready to go to the closing table because we have the information that’s needed.

Chris Arnold:
Absolutely. No, that’s fantastic. And Taylor, obviously, you know that we are helping people all around the country, set up radio in order to find discounted properties. And you’ve been with us so long that you’ve processed contracts coming off of things like direct mail, ringless voicemail, online marketing, bandit signs. You have process contracts coming from just about every lead generation source out there because we’ve tried them all because we’ve in business now 15 years. My question to you is, for those that are interested in setting up radio, that’s something that they’ve heard us and myself talking about, have you observed anything from your perspective as a closing manager, when it comes to the difference between a contract that comes from radio versus other sources? Just curious.

Taylor:
I have. There’s three main things. One, they’re usually easier to close. They do have their title issues, but they are a little bit easier to close. And one reason for that is because the sellers are usually so driven. I mean, they’re the ones calling us to help them.

Chris Arnold:
Wow. So you observed that the sellers coming off radio are more motivated than the other sources we have?

Taylor:
Yes, I would totally [inaudible 00:27:33]. They’re just more, they’re driven, they’re calling us, they’re needing our help. So A versus B, the seller that we call that maybe they’re potentially going into foreclosure, and to the seller that’s called a radio lead that they know that foreclosure is coming and they need help getting their home sold. They’re at least 50 to 75% more driven to, “What do you need? I can get it to you tomorrow. You need this information? I’ll call the IRS myself and sit on hold with them.” That’s why it’s so much easier when it comes to these leads, the quality of those leads. It’s just that much better because they are so driven.

Chris Arnold:
Yeah.

Taylor:
And then another great thing about radio leads, again, having to do with the quality, the profit margin is much higher, usually on those radio leads.

Chris Arnold:
Would you say that out of every type of marketing we do, our biggest profit comes from leads that come via radio?

Taylor:
I would say so. Yes. A big part of it.

Chris Arnold:
Yeah, absolutely. And I know that as well because you know, we track everything. What’s always interested me about radio, of all the benefits that are there, is that one of the biggest which you just hit on, is the fact that it produces us the highest average profit per deal. So if you’ve been listening and radio is something you’re interested in, you’re like, I’m nervous about ringless voicemail and text blasting. The regulation, the tech changing. Direct mail is over saturated in my area. Again, it just keeps going and going and going on some of the challenges out there on finding discounted properties. And that’s what wholesaling is. It’s the art and the ability to find properties at a discount.
What I encourage you to do is go to wholesalinginc.com/reiradio. Again, wholesalinginc.com/reiradio. And book a call and ask more questions to figure out if 2020, this year for you, is really about getting a great lead generation source set up like radio. Which of course for us has been really the best thing we’ve ever set up throughout the years. Taylor, you’ve been around with us almost six years. So you know everything we’ve tried, radio has been awesome. So Taylor, thank you so much for coming on. Thank you for all the expertise that you’ve developed over the years, and more importantly, your willingness to share that with us today.

Taylor:
Thank you Chris, and again, thanks for having me.

Chris Arnold:
Awesome. Well, thanks for tuning in. We appreciate you coming and we will see you all soon.

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