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Title Talk

5 Smart Strategies to Help Shrink Closing Costs

Be Proactive, Informed, and Willing to Challenge the Status Quo by Radian Title Services Getting to the closing table can be exhausting. It is easy to go through the motions when your deals are almost over the finish line but finding ways to save during the often-overlooked closing process can significantly impact your financial position. Do not miss out on untapped potential for savings at closing to positively impact your investments. It is important to educate yourself on ways to help boost your overall returns, especially when dealing with multiple properties or frequent transactions. Here are five strategies that can help you save on closing costs: 1 — Shop Around Your first option may not always be the best one. Closing costs and fees can often vary greatly from one provider to the next. Do not settle for paying inflated prices and be sure to compare rates from:  »            Mortgage lenders  »            Title companies  »            Home inspectors  »            Insurance providers Small differences can add up to substantial savings, especially when closing on multiple properties. 2 — Negotiate Fees With some closing costs being negotiable, you can leverage your status as a frequent buyer to seek discounts on fees like appraisals or loan origination. Negotiating these fees may significantly impact your returns. You can also consider timing strategies, such as coordinating multiple closings, to maximize your negotiating power. Remember, your volume and frequency of transactions may be a strong bargaining chip in such negotiations. Do not be afraid to ask for discounts or fee waivers, especially if you are a repeat customer or bring multiple transactions to a provider. 3 — Streamline with Bulk Transactions Bulk transactions may offer a powerful strategy to help reduce closing costs. For investors juggling multiple properties, this strategy is not just about saving money — it is about reclaiming one of your other most valuable assets: time. By consolidating your transactions, you may be able to reduce your closing timeline. Services like Radian Title Insurance’s bulk title ordering provides a streamlined operation, helping you close on multiple properties simultaneously. With these services, you will also enjoy competitive pricing, which may free up capital for your next big investment. Time saved is money earned — bulk transactions can help deliver both. 4 — Consider Closing Cost Assistance Programs Many closing cost assistance programs exclude investors or have owner-occupancy requirements, but that does not mean that there are not other opportunities to capitalize on. State and local government-offered programs may be available that can help investors, especially in areas targeted for economic development. For example, some states offer the following grant programs:  »            Historic Preservation Grants  »            Energy Efficiency Programs  »            Opportunity Zone Incentives  »            Community Development Block Grants The key to identifying opportunities that work for you is to review program terms and understand your eligibility. 5 — Pay Cash if Possible It may not always be an option, but paying all cash for your investments may help reduce several closing costs. Cash purchases can eliminate or reduce:  »            Mortgage-Related Fees  •            Loan Origination Fees  •            Mortgage Application Fees  •            Mortgage Insurance Premiums  »            Lenders Title Insurance  »            Escrow Account Setup Though some costs are eliminated, cash buyers may want to still consider paying for certain services, like title insurance or appraisals, for protection. A Dollar Saved is a Dollar Toward Your Next Investment Every dollar you save on closing costs is a dollar you can put towards your next big opportunity. By implementing these five strategies, you may not just cut closing costs, but also set yourself up for even greater success. Be proactive, informed, and willing to challenge the status quo. Do not let closing costs erode your profits; instead, view them as an opportunity to optimize your investments. With careful planning and strategic decision-making, you can turn the closing process into a powerful tool to help maximize your real estate portfolio’s profitability.

Title Talk

5 Title Issues Real Estate Investors Should Know

Strategies to Help Investors Deal with Them Proactively by Radian Title Services Build a thriving portfolio by identifying opportunities and implementing strategies to help protect your investments. Successful investors may use due diligence to their advantage, positioning them to navigate challenges and grow their real estate investments. But even the most carefully curated portfolios can face unexpected challenges. Here are five common title issues that could turn your portfolio into a financial nightmare and strategies to help you deal with them proactively: 1. Undisclosed Liens Consider this — you closed on a seemingly ideal rental property, only to discover it carries a mechanics lien from a previous, undisclosed renovation. This situation could impact your projected returns. Best Practice // Be proactive and insist on a comprehensive title search. Understand how the title company identifies recent liens that may not already be reflected in public records. 2. Survey Discrepancies Inches can cost thousands in boundary disputes. You may encounter situations where, post-closing, neighboring property owners contest the boundaries of a newly acquired property. This could lead to costly legal proceedings and property line alterations. Best Practice // Help minimize boundary-related conflicts by obtaining professional surveys, particularly for properties with complex lot configurations or newer subdivisions. 3. Unknown Heirs Don’t let heirs sneak up on you. In probate or estate sales especially, previously unknown heirs of a prior owner may emerge with legitimate claims to the property, complicating what appeared to be a clear title. Best Practice // Consider title insurance that affords coverage for potential heir claims. When acquiring property through probate or estate sales, it may be a good idea to conduct additional research into the deceased’s family history. 4. Document Forgery Be aware that instances of forged documents are possible. They can lead to your ownership being questioned and legal disputes regarding your ownership rights. Best Practice // Don’t fall victim to this issue by carefully examining the chain of title ownership. Be wary of unexplained gaps in ownership or unusual transfer patterns. If any aspects of the title history seem questionable, there may be reason to investigate. 5. Undisclosed Easements Investing in a property with plans to expand or develop is exciting! Just make sure you aren’t surprised with any undisclosed easements; they may impact property usage and development potential. Best Practice // Thoroughly review the property’s title commitment. Pay attention to the exceptions section, which details easements and other encumbrances that might not be covered by the title policy. Financial Implications Imagine watching years of hard-earned profits vanish due to an unforeseen title issue. Even seasoned investors can fall victim to these problems. Be proactive and take steps to help protect your investments. According to a study commissioned by the American Land Title Association, the most frequent types of claims can cost $26,000 on average to resolve, including $5,000 to defend. Some of the most expensive claims can exceed $143,000 — more than enough to wipe out the profits from a deal. Purchasing owner’s title insurance may help protect you from paying these costly claims out of pocket. Help Safeguard Your Real Estate Portfolio Pursue opportunities confidently by knowing that your investments are insured with title insurance. Comprehensive title protection can be your secret weapon for risk management and portfolio growth. Title insurance, offered by providers like Radian Title Insurance, provides protection for as long as you own the property, all for a one-time premium, making it an invaluable resource to add to your toolbox. Prioritizing title due diligence helps avoid potential pitfalls and position real estate investors to realize the maximum potential of their investments. Successful investors don’t just identify great opportunities, they excel at protecting their investments for long-term growth. Sharp insights may drive success, but proactive planning helps ensure it lasts. This communication is intended to convey general information only and not to provide any legal or accounting advice or opinions. An attorney or accountant should be consulted for specific information.

Title Talk

Title Insurance 101

Navigating the Differences Between Lender’s and Owner’s Policies by Radian Title Services Protecting assets is a primary goal for experienced real estate investors, but do you fully understand one of the most common safeguards in property transactions? Title insurance for your investments comes in two forms: the lender’s and owner’s policies. All investors should understand these policies and how they may help protect real estate assets. Lender’s Title Insurance Policy Lender’s title insurance policies may be required when borrowers take out a mortgage. Here is some helpful information:  »         Coverage Scope // Only protects the lender’s interest in the property up to the loan amount.  »         Diminishing Value // As borrowers pay down the principal mortgage amount, the policy’s coverage amount also decreases accordingly.  »         Limited Lifespan // Once the loan is paid off, the insurance policy expires. Lender’s title insurance policy coverage does not extend to a borrower’s equity in the property. Should a claim arise under a lender’s title insurance policy, the borrower may still be responsible. It is important to note that lender’s coverage does not apply when you pay cash for a property. Owner’s Title Insurance Policy Protecting your stake in a property is where owner’s title insurance may help:  »         Equity Protection // Helps safeguard ownership rights and the full value of the title1.  »         Lasting Coverage // Policy coverage does not expire once the mortgage is paid off (or if you have paid in all cash). Instead, the policy terminates when the insured sells the property.  »         One-Time Investment // These policies are paid for once at closing, and coverage continues for as long as the owner, or their heirs, have an interest in the property. Owner’s title insurance policies may not be just a safety net, but also a strategic tool. It can help protect your property interests from unforeseen claims, such as:  »         Undisclosed heirs of prior title holders claiming ownership  »         Forged documents that occurred prior to insurance policy issuance  »         Errors in public records  »         Undiscovered liens or encumbrances Not All Title Insurance Policies Are Made Equal It is easy to believe that all title insurance policies are created equal, but that is not entirely true. While the American Land Title Association (ALTA) and state land title associations provide standard policy forms, there can be variations in coverage and service quality. Innovative title companies are disrupting the status quo. For instance, Radian Settlement Services offers titlegenius by Radian, a 100% digital closing platform that revolutionizes closings:  »         Competitive Rates // Helping to potentially reduce closing costs without compromising on protection.  »         Enhanced Transparency // Stay informed at every step of the closing process with reminders and status updates.  »         Bulk Order Uploading // Reduce the time spent manually ordering title insurance for each closing. These innovations represent convenience, potential cost savings, and help to reduce uncertainty around your real estate closings. Strategic Considerations for Title Insurance  »         Portfolio Protection // When building a real estate portfolio, consider how an owner’s title insurance policy may provide long-term protection across multiple properties.  »         Due Diligence Tool // The title search process for title insurance can help uncover potential issues before you close, enabling proactive addressing.  »         Cost-Benefit Analysis // The advantages of owner’s title insurance policies may exceed the initial investment when you compare that cost to potential expenses incurred while fighting claims not covered by insurance. The Bottom Line Your success hinges on making informed decisions that help to protect your assets. While lender’s title insurance policies are oftentimes mandatory, owner’s title insurance policies may be used as strategic investments in your portfolio’s future. Safeguarding assets is essential. Incorporating title insurance into your investment strategy may help to protect your property rights and provide peace of mind. 1          Coverage amount may be the lesser of the insurance amount or the difference between value of title as insured and value of title subject to the risk insured against by the policy. Coverage does not include forgery that occurred pre-policy issuance (or the Investor’s acquisition); other restrictions may apply.

Title Talk

The $638 Million Reason to Choose Your Title Company Wisely

What Savvy Real Estate Investors Should Look for in a Title Company By Radian Title Services As real estate investors, you are always on the lookout for the next great opportunity. But in building your asset portfolio, are you giving enough thought to the foundation of every transaction — the title company? This often-overlooked aspect of real estate investing may help make or break your success in the long run. The title landscape has seen a surge of innovation in recent years. While innovation is welcome, it is crucial to look beyond headlines that seem too good to be true. The real value of a title company lies in its ability to protect your investments when things go sideways — and in real estate, they often do. Consider this: According to the American Land Title Association (ALTA), title insurance companies paid out over $638 million in claims in 2023 alone. This staggering amount highlights the importance of choosing a financially stable title company. New title technologies often lack the financial backbone to weather significant claims. In the worst-case scenario, an underfunded title company facing multiple large claims could become insolvent, potentially leaving investors exposed to heavy losses. So, what should savvy real estate investors look for in a title company? Here are several factors to consider:  »         Financial Stability // Consider whether a title company is backed by a strong parent company or with a proven track record of financial health. This may indicate adequate resources to pay claims and continue operations even in challenging times.  »         Claims-Paying History // A reputable title company should be transparent about its claims-paying history. This may demonstrate their ability and willingness to stand behind their policies when issues arise.  »         Customer Service // Responsive, knowledgeable customer service can make all the difference when navigating complex transactions or addressing title issues.  »         Underwriting Knowledge // Experienced underwriters can spot potential issues before they become problems, helping to save you time and headaches down the line.  »         Industry Relationships // Established title companies often have strong relationships with local recording offices, and other key players, which can help expedite transactions and resolve issues more quickly.  »         Technology Balance // While technology can streamline processes, it should complement, not replace, a human counterpart. Look for companies that leverage tech wisely without sacrificing the personal touch.  »         Regulatory Compliance // A good title company is fully licensed and compliant with all relevant state and federal regulations. This helps protect you from potential legal issues down the road. If you rely heavily on your agent to select the title company, make sure you understand why they chose a particular title company. Often real estate agents are incentivized to choose certain title providers. Their brokerage may have an existing relationship with a title company, or the brokerage might receive financial incentive for referrals to an affiliated title company. Remember, the easiest option is not always the best when it comes to protecting your investments. As we wrap up this inaugural Title Talk column, we want to share about who we are: Radian Title Services (which includes Radian Title Insurance, a title insurance underwriter and Radian Settlement Services, a title agency offering settlement services). Backed by Radian Group, a trusted name in mortgage and real estate for over 47 years, Radian Title Services combines financial strength with exceptional customer service. With Radian Group’s impressive $5 billion market cap and over 1,100 employees, investors can rest assured that Radian Title Services has the resources and stability to help protect their investments for the long haul. This backing provides peace of mind that your title insurance and settlement services provider will be there when you need them most. In future columns, we will dive deeper into specific title issues, emerging trends, and strategies to help protect your real estate investments. Until then, remember: a strong foundation may start with a strong title company. Choose wisely, and happy investing. For licensing information please visit www.radian.com/licensing-disclosure

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