Automated HOA Document Acquisition: Losing Control or Gaining Opportunities?
While the entire title and escrow industry is slowly heading towards automation and digitalization, HOAs, or homeowners associations, stay the same – disorganized, manual, and hard to deal with.
Even though HOA documentation is usually the responsibility of the seller, it usually falls on the shoulders of escrow officers since obtaining the documents is a must but sellers often don’t know how to contact the HOA or sometimes don’t even know that there is an HOA, or two or even three! HOAs, therefore, become one of the most painful parts of an already complex and multi-faceted process that can lead to delayed or even canceled closings.
Where title companies struggle the most with HOA documents
Why is acquiring HOA documents such a pain? The nature of HOAs – volunteer boards, unique organizational structures, disparate information systems, and tech avoidance – has stagnated innovation in the closing processes.
“HOAs are one of the few areas of real estate transactions that still need to be automated and standardized,” said BV Jagadeesh, SVQuad’s Founding Manager Partner and seasoned entrepreneur focused on technology and innovation.
Reliance on the seller
Dealing with HOAs requires a lot of back-and-forth communication, sending and receiving paper documents and checks or even money orders, and deciphering all the different document formats that each HOA has while making sure that no fine-printed fee is missed. It’s an immense risk and a huge slowdown in the closing process.
Title companies often rely on the seller to provide the HOA information. This creates friction in the transaction, a worse customer experience, and a risk of missing an HOA. More often than not, sellers don’t have a good understanding of their HOA situation. Even if they do, the back-and-forth with the seller also takes away your time, and more importantly, your control over the transaction.
Paying HOA document fees
Another significant friction point when it comes to involving the seller is document fees. Every HOA has its documents fees, which are paid by the seller. This means that the escrow officer has to chase the seller to pay hundreds of dollars for the documents months in advance of the transaction. Needless to say, it is not a pleasant experience for the seller, and it also doesn’t prompt positive customer feedback for the title agency.
What some title agencies do is pay for the documents themselves and charge the seller at closing. Considering the length of the closing process and the fact that agencies work on multiple closings simultaneously, this option creates huge overhead costs along with other financial and reporting complexities.
If you are in search of a reliable partner for HOA document acquisition, make sure they front the fees for you, so that you only charge the seller at closing. This means fewer hurdles for you and a much better customer experience for your clients.
Facing the staffing challenge
The title industry is very personal, the same as the home-buying experience. In recent years, the pandemic along with consumer demand has shifted the title industry toward digital transformation. Even with the new technology at hand and the new generation of tech-savvy escrow officers, the “human touch” and personal communication with clients are essential in the title business. It is not only about finding enough employees, it is also about finding the right employees for the job and providing them with the right resources to retain them.
According to the Voice of the Title Agent 2022 report conducted by Qualia, 45% of respondents expressed staffing as one of their biggest challenges for the upcoming year due to increased workload. Obtaining the HOA documents ranks really high on the most dreadful tasks on an officer’s list and that process attributes to employee frustration.
This new generation of escrow officers won’t just sit there and read over hundreds of pages of HOA documentation when they can spend their time on more meaningful work such as spending time with their clients and providing superior customer service. That being said, high employee turnover is expensive and training staff takes a long time. How to reduce it? Offload the HOA part of the closing process from your team’s shoulders.
Can escrow officers give up control of HOA documentation?
Giving up control of the HOA process might be scary as the process is complex and risky. But do you really give up control or gain efficiency if you look to leverage a third party? Being less involved in the HOA process does not mean having less control over it.
By offloading HOAs to the right business partner, you can spend more time focusing on delivering a superior customer experience instead of dealing with yet another manual process.
Try to find a customizable HOA document processing platform that works in line with your business operations and eliminates unnecessary HOA interactions.
Innovation won’t take the title and escrow jobs away. It will make the job more enjoyable though. The title industry is personal. So why not spend your time on exactly that – personal interactions with clients and exceptional customer experience?
How can title companies stay in control of the HOA document acquisition process?
Relying on an automated process for HOA interactions can reduce mistakes in document processing, save time, and bring focus and transparency to the closing process, ultimately allowing you to make your customers happier homeowners.
Here are a few opportunities you will seize when automating your HOA documents acquisition process:
Call handle times, getting back and forth through email, waiting for the HOA documents to arrive, and rummaging through billions of pages to find the key closing insights – these are all hidden costs that your company can incur penalties on if missed. In addition, using a third-party provider who knows how to contact the HOA right away helps you save your clients hundreds of $$$ in rush fees.
You can now analyze your spending on HOA, time to closing, common trends, major drawbacks, etc. You can also compare the performance of an HOA platform VS your own manual work.
No more days buried under the paperwork? Your employees will feel valued, which means they would bring more value to the company. We tested this with Endpoint.
Improved client satisfaction
Your employees now have more time and resources to dedicate to clients. Your processes run smoothly, and you have no delays because the HOA keeps ignoring you. Sounds like any customer would love that, doesn’t it?
The real estate industry is getting digitized and consumers are pushing for faster and smoother closings with as little involvement on their part as possible. You don’t want to be the last one to get on board. Chances are, you can still beat your competitors when it comes to automation, which your customers will appreciate you for.
Know who to trust
Trusting a third-party platform with the HOA process is scary. Are they going to miss an HOA? Will you need to clean up their mess afterward? Is it going to be a total mess?
Not if you know who you trust.
Do a free trial first. If a provider doesn’t offer you a free trial, how can you commit to working with them? Everyone can sound trustworthy – but experiencing the product is the best due diligence you can do. Make sure their platform and service level is right for you, and they can become your long-term partner.
Bonus points if the platform is ready to implement custom features for you. We regularly catch up with our clients to collect their feedback and develop the exact features they need. Works like a charm for both parties, just look at our clients’ success stories.
InspectHOA also gives you full control of the HOA order process. Our platform has a real-time document tracker that shows you when and how every step of the process is handled. We also have exceptional customer support service available at your disposal. We answer within 30 minutes.
Efficiency, engaged employees, and happy customers. Sounds like a win-win to me.
are opportunities to use technology and automation to enhance the
We are constantly tweaking and refining our processes, so we needed a
partner that would go along this journey with us. And InspectHOA is exactly that.