The last couple of week we have been talking about the importance of real estate tax monitoring for commercial loan portfolios. We have gone over how this service differs for commercial loans as well as why proper risk management is important. Today we are going to discuss what you can do to make sure you are choosing the right real estate tax servicer for your commercial portfolio. Because this service has not been commonly outsourced in the past, you may not have as good of an idea of why the right vendor matters. In order to avoid delinquencies and remain within compliance of audit regulations, it is imperative that you sit down and look at whether your institution can benefit from outsourcing real estate tax services for commercial loans. Not all vendors are created equally, so we hope this blog gives you a better idea of what to look for when shopping for the right vendor.
Top Considerations for Tracking Commercial Loan Portfolios
Commercial loans are complex, to say the least. There are many different factors that must be considered when looking at whether you should outsource this service to a real estate tax services vendor that specializes in commercial loans. Again, because this is not a super common service to be outsourced, it is important that you know what elements are monitored—and why.
For starters, file accuracy is a big one. In fact, we’d venture to say that file accuracy is more important to the commercial side than other types of loans. It is not uncommon for businesses to undergo name changes, neglecting to notify the bank. When this service is outsourced, the real estate tax service will check the account for any changes made to the parcel, such as property address, name, and payment status.
How Do You Know if a Vendor is Right for You?
The truth is, many vendors do not offer efficient or cost-effective real estate tax services for commercial loan portfolios. With this in mind, it is of the utmost importance that you look for a vendor who specializes in this area - and offers competitive pricing. Look for a vendor who charges one blanket life of the loan fee for up to 20 parcels (for example), not a vendor who charges a fee for each and every parcel. The latter is what creates high fees and causes lenders to balk at the idea of outsourcing this service.
In addition, look for a vendor who places importance on file accuracy and customer service. A vendor that will take the time to ensure the information they are providing you is right, and will find any discrepancies, makes a big difference. You also want a vendor that will answer your call right away, stay in constant communication with you, and understands that a customer’s success is dependant upon the quality of service provided.
Figuring out if commercial real estate tax services is right for you can be a daunting task, but we hope you have a good place to start by taking the above tips into consideration. Remember, look for a vendor that offers low fees, prioritizes file accuracy and customer service, and will customize their services for your needs. To learn more about real estate tax services for commercial loan portfolio, check out our latest ebook here.