The Forever Cash Life Real Estate Investing Podcast: Create Cash Flow and Build Wealth like Robert Kiyosaki and Donald Trump
How to Deal with Difficult Title Companies
Manage episode 293771022 series 2604156
On today’s episode of the Forever Cash Life Real Estate Podcast, we’re going to talk about how to deal with difficult title companies.
I’m going to share a recent experience of mine with a really terrible title company. Let’s just say I’ve never seen anything this bad in the 19 years I’ve been flipping land. I’ll share some valuable advice, in case you find yourself in a similar situation.
What Title Companies Are Facing Right Now
The current situation in the U.S. has title companies swamped with deals from everywhere. It’s like 2005-2007 again, and title companies are overwhelmed. I get this. It’s like a perfect storm.
- Interest rates are still at a record low
- Homeowners are refinancing like crazy
- The real estate market is exploding
But does this give them an excuse to be incompetent and do terrible business? No. In fact, I’ve dealt with some really great title companies lately. They’re doing their job and doing it well, in the midst of all that’s going on in the market.
What Can Happen When a Title Company Doesn’t Do Its Job
When you’re in the land flipping space, the title company is a very important entity. They can make your land deal go smoothly or do the exact opposite. In the past few weeks, we’ve done five deals and dealt with four different title companies. Two of the title companies were absolutely fantastic, and two absolutely sucked.
For one of the deals with the not-great title company, we sent them the signed contract, and they started doing the title search. A week went by, then two, then four. Seven weeks later, we finally got the preliminary title report.
The property was inherited from a father who had put it in a family trust and made the son and daughter trustees. This isn’t difficult to solve. You just need the estate documents, the trust documents, and their information. A decent title company should be able to get this done in two days. It took this title company another eight weeks.
I followed up every day, and every single time, the woman on the phone said, “These land deals are so complicated.” This agent was 100% unqualified and inept. I literally woke up in the middle of the night with nightmares about this person.
What a Competent Title Company Will Do For You
At the same time I closed another deal. I bought a property for $90k and sold it for $199k. That deal involved multiple LLCs and a family trust. This time the title search took three days, as it should.
At the end of the day, the title company’s job is to:
- Make sure there are no title issues.
- Make sure that whoever signs for the sale of the property is truly authorized and the rightful owner on the deed.
The title agent for this deal needed more documentation, and I got it all for her. She was thrilled. She sent out closing documents 2 days later, and we closed in 12 days total.
What You Have to Do Yourself If the Title Company Is Incompetent
If you’re unfortunate enough to be stuck with an incompetent title company, you’ll have to jump in and help them do their work. I left a voicemail, then sent multiple follow-up emails every day. They kept dragging their feet. I know the squeaky wheel gets the oil, so I made some noise.
The road on the extra mile is empty. You’ve got to do whatever it takes. We’re 15 weeks into this deal. We’re too far in. It should have been done in 2 weeks. I’m not going to pull it and go to a different title company. So I jumped in. I have a relationship with both the buyer and the seller, so I told the agent I’d be the go-between. I did more work than the title agent to close this deal.
You Can Go the Extra Mile Even with the Good Title Companies
Title searches are taking longer these days, even with competent title companies. They might have 25-50 deals on the docket, and they’re prioritizing the ones that make them the most money. If yours isn’t a million dollar deal, you can move up the list by making noise.
- leave voicemails
- send emails
- follow up
- repeat, repeat, repeat
Basically, you commit to being a bother until they give you what you want.
Remind them that, if interest rates go up even a little, refis will stop cold. If you’re dealing with a reasonable title company, they will value your relationship and take a long-term view.
- How to talk to an incompetent agent without them quitting on you
- A timeline you can reasonably expect from a competent title company
- Things you can say to a title agent to make the wheel squeak
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