Robert Donica

Rocket Realty offers the title company guide from a napkin to a contract that your business needs.

1How often have you wished that there was a title company guide to lead you through the most difficult situations in your industry?  At Rocket Realty, we know that one of your biggest challenges can be the the For Sale By Owner seller who is staunchly opposed to the help of a real estate agent.  In their determination to save money, these clients look to you to turn their deal on a napkin into a formal contract.  Often, the familiar scene unfolds like this:

You look from the clients in front of you to the wrinkled napkin on the table and back again.  They explain that they went out to lunch with their buyers this afternoon and everything has gone well.  They have agreed on a price and both want to use your title company to close the deal.  And since they are selling their home FSBO, they don’t have to worry about paying for a REALTOR’s services.  After all, they have all the information they need right there on the napkin…

The napkin contains an address, a sales price, two signatures, and a couple other notes.  Now, it is up to you to guide your clients through the closing process.  


The Problem

The challenge here is that this napkin, though a step in the right direction, is not sufficient to close the deal.  They need a formal contract that will address the many important issues at stake in such a deal, including inspections, surveys, and the division of closing fees.

Some clients may not even realize that such a contract is necessary before all of the other closing tasks are accomplished.  However, as REALTOR and HGTV real estate expert Brendon DeSimone writes to buyers, “Yes, at this early stage of the game, you need to sign a legally binding contract. By signing on the bottom line, you’re committing to moving forward on the purchase with the seller. There are contingencies, or “outs,” to many real estate contracts, however. Most contracts will be contingent on inspections, disclosure review, loan approval, appraisal or other matters.” Your client’s napkin almost certainly does not include these important contingencies or other necessary pieces of information.
(http://www.zillow.com/blog/the-anatomy-of-a-real-estate-purchase-93178/ @brendondesimone )

3Yet, as their title company guide, it is up to you to provide a workable alternative.  After all, your clients are trusting you to guide them through the closing process for the sale of their home with their best interests in mind.  You need to make sure that you deliver.

In Indiana, the closing process usually exists in three stages.

  • After a contract is established, disclosures and inspections occur while a title company like yours works on preparing the title commitment.  
  • Those borrowing money secure a mortgage.
  • The actual closing takes place when sellers, buyers, and agents meet at your table to sign all of the final documents and exchange payments.

In recent years, this challenge has intensified as more and more sellers have opted to go the FSBO route.  In fact, in 2013, 9% of home sales were done for sale by owner.  And, among those who sold their home on their own, understanding and performing paperwork and getting the price right were rated the most difficult tasks.  As trends continue in this direction, it is going to be imperative for title companies like yours to have the solutions these sellers need.

(http://www.realtor.org/field-guides/field-guide-to-quick-real-estate-statistics, @REALTORS)

How Does A Title Company Guide These Clients?

Screenshot at May 27 17-49-34In trying to offer clients like these the guidance you need, you have traditionally had three different options to offer them… none of which can really address the client’s’ desires for great service and significant financial savings.

The REALTOR. You could send your clients to a typical REALTOR.  Although it may get the contract written, it also sets your client up to lose a significant percentage of their sale price for just this one service.  Although the real estate agent might be happy with this setup, it is exactly what your client has been trying to avoid.  They’ve gotten this far on their own, and they need a solution that is going to respect that effort.

How Does A Title Company Guide These Clients?

In trying to offer clients like these the guidance you need, you have traditionally had three different options to offer them… none of which can really address the client’s’ desires for great service and significant financial savings.

The REALTOR. You could send your clients to a typical REALTOR.  Although it may get the contract written, it also sets your client up to lose a significant percentage of their sale price for just this one service.  Although the real estate agent might be happy with this setup, it is exactly what your client has been trying to avoid.  They’ve gotten this far on their own, and they need a solution that is going to respect that effort.

4The Attorney. A second option is to refer your clients to an attorney.  However, this is no guarantee of the end product you are actually looking for.  Because attorneys use their own forms, rather than Indiana real estate contracts, you may end up in yet another situation with insufficient information to close the deal.  Essentially, your clients could end up paying an attorney’s fee for what is as helpful as their original napkin contract.

The DIY Contract. Finally, you might decide to forego outside help altogether and simply offer your client one of the state contracts to fill out on their own. Of course, it is no secret that these contracts can be confusing and your clients may soon start asking questions.  You need to be careful when clients start asking questions like these; your REALTOR clients may even claim that you are practicing real estate.  Walking this fine line may quickly become more problematic than it is helpful.

2Clearly, you have a problem.  You have to get your clients the help they need to draw up a workable contract from their napkin deal, while still respecting their efforts to save money so far.  What are you going to do?

The Rocket Realty Solution

At Rocket Realty, we understand that you and your clients are in a difficult situation.  So, we have worked to develop a solution that helps everyone achieve their goals.  In four simple steps, we can ensure that you get the contracts you need and your client will be satisfied with paying a flat, reasonable fee for just the services they need.

Screenshot at May 27 17-52-36


Step One: We will start by meeting with both the seller and the buyer and start talking about those parts of closing that aren’t listed on the napkin yet.  We will talk with them about dividing responsibilities and expenses, as well as particular requirements in Indiana real estate law.

Step Two: Once we have both clients on the same page, we’ll focus on that paperwork.  We will ensure that the proper forms are accurately completed, including: lead-based paint disclosures, seller’s disclosures, purchase agreements, and more.

Step Three: With the paperwork drawn up, we will walk clients through the title work ordering process.  From inspections and financing to the final closing, we will work with your client the entire way.

Step Four: Finally, we will be there with your clients at the final closing to answer any last minute questions and help the process run smoothly and efficiently.

5With this process, your client gets the experienced help of an agent who has closed over 400 real estate transactions while still maintaining their FSBO savings. Our rate for fully assisted closing is $500 for single family residences, regardless of the sale price of the house. When you recommend Rocket Realty, your clients can get excited about the savings, and the service, they receive.

At the title company, you will benefit from expertly completed paperwork and an ally for your client throughout the process. At Rocket Realty, we value efficient and streamlined systems, ensuring that the whole transaction unfolds smoothly and on schedule. Of course, you will also enjoy the benefit of happy clients who thank you for the perfect solution to their napkin contract challenge.

Does this sound like the kind of solution you and your clients are looking for? If so, call us today at 844-576-2538 and ask for our title company guide for more information.

How else have you, or your clients, tried to turn napkins into workable real estate contracts? What happened!? Share your stories in the comment sections below.