Dan:  Today, we are talking with Mark Eibner, principal of Meridian Title and Escrow.  Mark, thanks.

Mark Eibner:  Pleasure to be here Dan.

Dan:  Yeah.  Well, let's talk a little bit about the title business because I am sure your average consumer doesn't know an awful lot about it and I also want to talk about ABAs, affiliated business agreements and so forth.  First, let's talk with ABA.  What is it?

Mark Eibner:  Well, an affiliated business agreement is just another unique way of doing business where actually the owners or the shareholders are in fact people that are doing business as real estate brokers or mortgage brokers.  So, it is really no different than a traditional title company experiencing the fact that you are either a corporation or an LLC.  It's just that in this particular case your closely held participants are owners in the company.

Dan:  All right.  Let me give people an example.  I am a realtor, I could own a portion of the title company, correct?

Mark Eibner:  Correct.

Dan:  That's how that would work? 

Mark Eibner:  Umhum.

Dan:  But I have a buyer or a seller, I am representing one of the two and I direct them to business in my title company; is there a problem with that?

Mark Eibner:  No problem with that at all.  In fact it is done quite frequently and in fact in most parts of the country, ABAs are used on a regular basis.  I think where people run into problems is let's just take ABA or AfBA title companies where the single entity company owns it like ABC Real Estate Company and they actually force or persuade their brokers to use their title company when in fact their brokers are not really owners in the organization.  I think that's how most people see ABAs, not a traditional... in an ABA like ours, all the shareholders are actually real estate brokers or mortgage brokers.

Dan:  What does the Colorado Real Estate Commission think?  Do they say something to the effect of you need to disclose to a seller or buyer that you are directing them to use this title company and I own a share in it?

Mark Eibner:  Well, actually that's regulated by our friends at RESPA.

Dan:  Okay.

Mark Eibner:  And absolutely you have to in fact inform buyer's and sellers on every transaction that you in fact are part of an ABA, you could make a profit, may not make a profit, but you have to give disclosure, yes.

Dan:  And you can say to Mr. Buyer or Seller, the reason why I am sending you here is because given our model and structure, we can provide lower rates, lower fees, lower cost and if you don't want to use that, this title company, you are free to go pick whatever title company you want, correct?

Mark Eibner:  Yeah, absolutely.  I have all my clients sign what we call good faith title estimate, which can be obtained through mytitleins.com and it simply basically lists each for the transaction [music] mortgage is, what the payoffs are etc., how old the existing title's policy was, what the cost is going to be for the buyer, what the cost is going to be for the seller, and lo and behold nine times out of ten Meridian Title and Escrow is usually at least between first, second or third lowest on a cost structure.

Dan:  All right.  Well, because you have owners who are realtors and other people, mortgage lenders and so forth as part ownership, does that model lend itself to having lower rates in fees for people?

Mark Eibner:  Well, I think it absolutely just simply because in most cases you are not really paying title reps, you are not paying all the marketing fees, all the advertising, all the myriads of let's just say marketing schemes that traditional companies, title companies use, just to get you to use their title company.  Instead all that marketing money is put aside and in fact you are in fact the best rep for the title company itself and if there are dividends paid to the shareholders, quarterly in our case, then that's usually a result of the fact that we were not having to compensate the traditional marketing and the traditional marketing reps.

Dan:  Mark, good information.  Thanks.  Appreciate it.

Mark Eibner:  You bet.  Thank you.

Posted in Title Insurance

Dan:  Today, we are talking with Mark Eibner from Meridian Title and Escrow and Mark is one of the principals of the company.  Welcome to the show.

Mark Eibner:  Thanks Dan.

Dan:  Glad to have you here.

Mark Eibner:  You bet.

Dan:  You know as a realtor, when we are talking about title, you know I have to admit I am thinking, "Okay, title insurance rates, could they vary that much?" but I guess they do.

Mark Eibner:  Oh, absolutely.  I think the rates that are posted up... I think the real issue is that most agents, most consumers really don't have the time or even the expertise to go online up to the Department of Insurance, check out all the posted rates, check out all the posted fees, you will find if you do that all x amount of[Phonetic] counties in the state of Colorado have different rates from county to county.  It's just not the seven state or seven county [Inaudible].  So, there is a huge variable in the published rates that are up in the Department of Insurance site.

Dan:  Now, in the past, the rates used to vary widely, but now they are getting much tighter and more competitive, why?

Mark Eibner:  I think things are just getting tighter simply because of sites like say mytitleins.com.  It's a site that has been on for a couple of years now and it is really putting a little transparency out there for the consumers and actually for the real estate brokers and I think real estate brokers are actually becoming a little more in tune with actually looking out for their clients, being an advocate for their client versus perhaps in the past being an advocate for the guy that gave them free brochures.

Dan:  Yeah.  Let me see if I understand this right in that there is an agency that governs the rates and then an independent title company takes that rate and then they can add a little fees and things like that and that's what comes up with the disparity in rates?

Mark Eibner:  Well, there is no agency in our state here, there is no one that regulates rates.

Dan:  Okay.

Mark Eibner:  In fact, an underwriter, a national underwriter, could publish for any county any rate they wish and that goes for escrow fees too, anything would go out there effectively when a company files new rates or there is a 30 day period where the consumer could object or question, I would like to see how many times in the last 20 years that any consumer has ever been online and looked at the published rates of a national underwriter and complained to the Department of Insurance.  It just doesn't happen.

Dan:  So, the difference comes in the fees?

Mark Eibner:  Correct, the fees.  See, in states like Texas where they have promulgated rates, that is a state where all the rates are regulated by [music] so, once a year, they do get together, they look at losses, claims, underwriting fees, everything, the state decides for x amount of thousand, this is what every title insurer is going to charge.  In our state, that is not the case.  It's kind of free and wide open and rates can vary, in fact, we re-file even on a monthly basis if that's what you wish to do.

Dan:  All right and in the past, it was always thought that the seller picked the title company and that the buyer, poor buyer, didn't have a decision in the process, but as a realtor representing a buyer, you could actually advocate on behalf of your client and write into the contract, "Okay, we are going to offer x, y, and z, but we would like to pick the title company."

Mark Eibner:  Yeah, absolutely, if you actually read the contract now, it states that the buyer has a right to choose the title, because we have got two sides to the policy, we have got kind of the seller's side and the buyer's side for what they are paying if they are getting a mortgage.  The problem is when the buyer goes and maybe makes a choice of title insurance with another carrier, then they... then their listing agents, underwriter that they are using is you are not going to get the benefit of the simultaneous issue of the rates.  So, it's going to in that case actually end up costing the buyer more, that's what... in real life, that's perhaps what the real estate commission ignores is yeah, the seller can buy their title insurance, the buyer can buy their title insurance, but in general the buyer is going to end up paying more money because he is not getting that simultaneous issue rate as the seller has.

Dan:  All right.  Last question, why do business with Meridian Title and Escrow?

Mark Eibner:  Well, I think Meridian Title and Escrow is... it's one of the... it's a newer model ABAs or actually you would be surprised, they have been around for what? 17-20 years now; in a lot of states, very prominent because the model itself leads to transparency.  In other words, more than likely the broker that you are dealing with is an owner, more than likely perhaps even the mortgage broker you are dealing with is an owner.  They have the transparency and really the ability to choose in our case with Meridian Title and Escrow three different underwriters.  So, instead of being married to one particular underwriter, that has a limited reissue rate, okay, you can go and make your selection on each transaction and if you need to have an underwriter that has a 10 year reissue rate, then you go with the underwriter that has it, that's typically what we do, we go with the underwriter that offers the lowest rate to the consumer on that particular transaction.

Dan:  And saves you money?

Mark Eibner:  Saves... you bet, saves your seller money, it saves the buyer money.  I highly recommend using the site, mytitleins.com.  It actually will give a side-by-side good faith title estimate for the buyer and for the seller.  You would actually be shocked at how many times buyers are paying as much if not more than the seller in a transaction.

Dan:  Mark, thanks.  Good information.  Appreciate it.

Mark Eibner:  You bet.  [Voice Cross Over].

Posted in Title Insurance

LIVE COVERAGE AND INFORMATIVE INTERVIEWS FROM BROKERIPTV.COM

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Posted in Internet Marketing, Denver Colorado Real Estate, Blogging, Real Estate Investing, MLS, Real Estate Market Conditions, Title Insurance, Real Estate Industry, Real Estate Industry Trends, Lead Generation, RSS, Gen X-Y, Technology And YOU, Web 2.0 Marketing, National News

BrokerIPTV: Today we are talking with Mark Eibner from Metro Brokers Realty Oasis and we are talking about affiliated business relationships and so forth. How are you?

Mark Eibner: Great Dan.

BrokerIPTV: Now, of course you are the owner of Meridian Escrow and Title and Escrow, LLC. talk a little bit about how that all came about.

Mark Eibner: Well, I am one of many owners over at Meridian Escrow and Title. I think this was probably seven years ago we first started Meridian Escrow and Title and initially the company was owned as the top fundamental partners only with no broker ownership.

BrokerIPTV: Right.

Mark Eibner: Just a couple of years ago, we opened it up to get more broker participation within our own organization and brokers participating from outside real estate companies as well as mortgage brokers too.

BrokerIPTV: And how has that gone? How has that developed? I mean initially were some other Realtors® kind of reticent to join?

Mark Eibner: Well, I think it is just depends on the mindset you come from. What I am seeing is the economy is really making things happen. The AfBAs are really growing because people are... they are analyzing everything. Commissions are down. Transactions are down, but what I have seen is most of the brokers are more concerned about their being pushed to this by their clients because clients are becoming more aware that there are big differences in title insurance costs.

BrokerIPTV: Well, you mentioned the economy. What we are starting to see is contraction obviously. There are not as many title companies in business that used to be, they have laid off staff, whatever it may be, is that a problem with Meridian Title and Escrow and how have you been able to kind of survive these times?

Mark Eibner: Well, I think that's the magic of an affiliated business arrangement is the fact that the overhead is so much lower. The bricks and mortar part just isn't there. There is no lower, middle, and upper layer management. You don't have sales reps. I mean it's just the personnel and human power alone, the difference between say an ABA and a traditional title company is huge in what it costs. We also do a lot of on-site closings, at office closings, at people's homes closings, so the ability to maintain 20, 30, 40 locations and pay leases, it's just not there. We can hire staff up and staff down in a day.

BrokerIPTV: Yeah. I did the at home closing by the way and I liked it a lot.

Mark Eibner: Yeah?

BrokerIPTV: Yeah, incredibly convenient. Came to my house, signed the papers, they left, it's done.

Mark Eibner: That's very nice.

BrokerIPTV: All over. Profit - so obviously, it's more profitable because obviously you have got people bringing clients and business and you don't have an outside sales rep. Talk a little bit about how the profits are going.

Mark Eibner: We have been profitable from day #1. In fact, it's one of the few ventures that has been in the black for seven years. So, the ability to remain profitable also has another little caveat in the fact that we broke down our rate structure and where we get our premium from, over 80% of our premium dollars is from re-issue rate. So, literally, we are profitable even though we are doing title insurance premiums at 50% rates over say the traditional companies. So, we are still profitable even doing half rates. That's what we find amazing.

BrokerIPTV: Finally, if a realtor wanted to become involved in Meridian Title and Escrow, how would they do that?

Mark Eibner: I think the easiest thing to do is just go to the website, meridiante.com, just like Meridian Title and Escrow, and there is a e-mail contact us form on there, just fill it out or there are some phone numbers. You can call myself or John Clikeman, who is our attorney partner and we would be glad to talk to you and see if you qualify and if you want to become part of our organization.

BrokerIPTV: Mark, thanks. Great information. Appreciate it.

Mark Eibner: You bet, thanks Dan.

Posted in Title Insurance, ABA - AfBA

BrokerIPTV Today we are talking with Kirby Smith, Metro Brokers Cherry Tree Properties. Welcome.

Kirby Smith: Thank you Dan.

BrokerIPTV Glad you are here and one of the topics we are going to cover today is affiliated business arrangements and you are with Meridian Escrow and Title, but you are also a realtor with Metro Brokers. Talk about how that all came about.

Kirby Smith: Well, I have been a Metro Brokers... I have in the real estate business for... since 1995. I have been a Metro Broker from that time forward. I have never really looked into affiliated business arrangements until I was confronted with the Meridian Title and Escrow company.

BrokerIPTV Opportunity. Also, a little back on your background we should tell people that you are the 2009 President for Metro Brokers. Congratulations.

Kirby Smith: Oh thank you.

BrokerIPTV What... what is involved there? Is it just a loft title or do they put you to hard work?

Kirby Smith: There is a lot of... there is a lot of time that goes into that and... but, you know Metro Brokers there is a lot of volunteers in the company, it is a volunteer run and we have an excellent staff as well. So, certainly, not alone.

BrokerIPTV Obviously a very strong company. So, great to be president of a company like that I bet.

Kirby Smith: Yes, it is.

BrokerIPTV All right. All the years that you have been in business, what were kind of the things that you heard about affiliated business relationships?

Kirby Smith: I hadn't... have really investigated affiliated business arrangements at all. I think there was a lot of misinformation out there that you know you had to be very careful and watch your step and I... so, I stayed away from them.

BrokerIPTV Yeah and so far the experience has been what? The exact opposite?

Kirby Smith: Oh, it has been absolutely the exact opposite, yeah.

BrokerIPTV And is it that much of a big deal with the consumer? I mean obviously you disclose to the consumer that you think they should have the title work done here and here is why and so forth, but I mean are they all caught up in the legality of it?

Kirby Smith: No. They are not. I mean we disclose that this is you know affiliated business arrangement, but the... it's a pretty easy thing to go... to talk about because they are saving a lot of money by using Meridian Title and Escrow.

BrokerIPTV And I imagine that's why you got into it because it was what? Rates and...?

Kirby Smith: Oh, absolutely.

BrokerIPTV And service?

Kirby Smith: Absolutely. Looking out for my clients to save them money and make sure that they are very well taken of.

BrokerIPTV Yeah. Talk a bit about some of the benefits like re-issue rates and things of that nature.

Kirby Smith: Well, you have a 10 year re-issue rate with Meridian Title and Escrow. That's big. Most people's mortgages never reach a 10 year mark and in some of the bigger companies, you will find that their re-issue rate might end at three years. So....

BrokerIPTV All right. So, your experience to say the least has been positive.

Kirby Smith: Absolutely.

BrokerIPTV Would you recommend other agents to get involved in you know an affiliated business arrangement?

Kirby Smith: Oh, absolutely. If you are looking out for your client, I think you really have to. I think you have to shop and find where they are going to get the best service and you know the best value for their dollar spent.

BrokerIPTV And why Meridian Title and Escrow?

Kirby Smith: I think it's all because of service.

BrokerIPTV All right. Kirby, thanks for being us. Great having you here.

Kirby Smith: Thank you Dan.

Posted in Title Insurance, ABA - AfBA