Recently, I attended a presentation by Wayne Stanley and Michelle Korsmo, both with the American Land Title Association. Their presentation summarized the findings of several focus groups and research studies pertaining to the real estate closing process and the role of the title company/closing attorney. Based upon these findings, along with recent changes in our industry, it is apparent there is a need to shift our mindset from “marketing” to the purchaser to “educating” the purchaser, so they may be proactive participants in the closing process. Most importantly, ALTA is suggesting we focus on educating the purchasers on the role the title company/closing attorneys play in the closing process and the role of title insurance.
The research showed that homebuyers want more information about the real estate closing process. Research also showed that the more educated a person is about a product or service, the less concerned they are about the price. It should be the responsibility of the title company/closing attorney to clearly communicate their role within the industry and not let the sole responsibility for that messaging fall upon the realtor or lender. Communication of your role needs to be confident, optimistic and very clear. According to the Literacy Project Foundation, 50% of adults are not capable of reading higher than the 8th grade level, so keeping your communication to homebuyers about this relatively unfamiliar topic as straight-forward as possible is a “must.”
Start Education Early
Consumers want information on title insurance and the closing process early in the real estate transaction. The time to communicate with the purchaser is as soon as you receive the order in your office. Your communication could be via email or regular mail. Eighty six percent of homebuyers use the internet in the research process, which often includes visiting the website of the closing attorney conducting their closing, so introducing yourself and your firm through your website is appropriate.
What does your website say about the closing process? Do you explain the responsibilities you fulfill in the transaction? Simple explanations of key terms will help the homebuyer understand the process and the value you bring to the transaction. Consider the following examples:
- Title search – we search and review public records and title documents filed at the county courthouse specifically related to the property before you buy it. This helps you make an informed decision about your purchase.
- Closing – we prepare and organize the required legal documents, deliver them to the courthouse and ensure the documents are properly recorded. We also disburse the loan funds to the appropriate parties.
- Title insurance – we offer title insurance, should you choose to purchase it, and will discuss the benefits of this one-time purchase that is intended to protect your property rights and your investment in your new home.
ALTA can help
The American Land Title Association has developed and organized an extensive library of resources available to members. This library can be used for the most simple of communications (e.g., letters to the buyers) to extensive communication plans resplendent with blog posts, social media postings, presentations you may use for your realtor clients and marketing pages, all customizable with your company’s information. For those of you who do not have an extensive marketing budget, you will be pleased to know that ALTA offers these resources complimentary for their members. You may access all of these resources at www.alta.org/homebuyer.
About the Author
Tracey Webb, CPA, is the leader of Frazier & Deeter’s ALTA Best Practices Compliance attestation group. Tracey brings her clients the benefit of over 27 years of hands-on experience with one of the Big Four title insurance underwriters and an in-depth understanding of ALTA’s Best Practices. She serves on the ALTA Best Practices Task Force and is a frequent speaker at industry events regarding the Consumer Finance Protection Bureau and ALTA Best Practices.