In today’s fast-paced environment, title agents must deliver more than just accurate information—this information must be easily understood, integrated with technology, and securely shared across selected parties. As title companies continue to adopt technology into their workflows and processes, opportunities arise to improve operational efficiency. One opportunity is optimizing how title companies search for and deliver property tax information.
Performing tax searches is a crucial step in the closing process. Sourcing property tax information is important to inform homebuyers about their future tax responsibilities and identify any outstanding taxes from the seller. Unfortunately, manually ordering a full tax search for multiple closings is often a time-consuming and labor-intensive process. According to PropLogix’s 2021 State of the Title Report, 62% of title companies outsource tax research to vendors to scale this process. Since ordering tax data is so common during transactions, it’s a ripe opportunity to gain efficiency through automation and outsourced vendors.
We recently sat down with Erich Wiedel, President and Co-Founder of Mortiles, LLC. (a company that provides a wide array of closing services, including tax, title, and recording services), to learn more about the top challenges that title companies face when retrieving tax data, as well as solutions for improving efficiency and accuracy.
Local tax requirements: a common challenge for title companies
Sourcing property tax information is required in virtually every title transaction. Retrieving this data, however, is not so easy. Wiedel explained that tax collection requirements often vary by state, county, and town, making it difficult to create a consistent process for sourcing tax information. According to Wiedel, “there are thousands of intricacies at local levels in counties across the country. Not knowing those, or forgetting to collect those details can be a costly mistake.”
For example, if a title company operates in multiple regions, it may need to procure tax information with mail-away requests, faxes, phone calls, tax websites, and data files. These more traditional ways of collecting tax information from collector’s offices can be time-consuming and require lots of follow-up to get the necessary information. Since there are so many ways of requesting tax data, it’s often returned in a variety of formats as well. This means that agents must spend additional time evaluating and analyzing documents to verify the tax status.
Another obstacle for title companies is the level of research required to capture local property tax nuances. Managing tax searches can be particularly challenging if businesses have a lean team or are expanding into new markets. Tax searches can become a cumbersome and manual process that requires an in-depth analysis of each region. By identifying opportunities to improve property tax processes, title companies can reduce manual tasks, create efficiencies, and reduce errors when working across multiple regions. Wiedel explained that having a well-defined process to source property tax data is key to increasing efficiency and reducing error. For example, having a centralized vendor management process that integrates with title workflows means that agents can order services and manage vendors without leaving their core workflow.
Simplifying the ordering process with vendors and automation
Leveraging vendor partnerships and automation can help title companies save significant time when collecting tax data. Since property tax requirements vary greatly across regions, identifying vendors with local expertise can help title companies improve their tax search processes—especially when growing quickly. Wiedel explained that “vendors take the hassle, burden, and liability away from title companies.” Outsourcing to vendors who specialize in property taxes can give title companies peace of mind that all applicable taxes are collected and reported accurately. Doing so can enable title companies to quickly expand into new markets while consistently delivering accurate and timely tax information.
Once title companies identify high quality vendor partners, automation can add an extra layer of efficiency. Automating manual tasks, such as ordering tax searches, can create substantial time savings when taken at scale. Removing these manual tasks can help title companies centralize workflows and optimize vendor operations to create more efficient processes. For example, when creating an automation strategy, businesses can use reporting to identify top-performing vendors with local expertise in the regions where they operate. From there, they can set up Automatic Ordering in Qualia Marketplace to order tax searches (among other closing services like title searches and HOAs) from selected vendors right at order opening.
Since tax searches are so common during closings, optimizing this process can create significant time savings. By eliminating certain manual tasks and partnering with vendors with local expertise, title companies can save time, reduce costs, and decrease errors to deliver fast and accurate closings. Learn more about how Qualia can empower your office to improve the efficiency and accuracy of property tax data by requesting a demo today.