Recently, we’ve written about the potential consequences of inaccurate parcel or tax data, as well as how these inaccuracies often occur. Inaccurate data can lead to delinquencies, interest fees and penalties, unhappy borrowers, compliance issues, and more.
In this blog, we’ll examine the benefits of outsourcing real estate tax services, and how to ensure your vendor isn’t letting important information or potential errors slip through the cracks.
The Benefits of Outsourcing Real Estate Tax Services
Monitoring property taxes, identify and tracking delinquencies, maintaining up-to-date portfolio data, and escrow processing are critical tasks—but can be overwhelming for a bank or credit union to manage internally.
Outsourcing real estate tax services offers many benefits, including:
- Reassigning staff to other essential responsibilities
- Ensuring accurate and prompt tax payments
- Not having to chase down tax information from various tax agencies
- Keeping borrowers happy by avoiding delinquencies and late payment fees
Of course, these benefits apply when working with a quality real estate tax services vendor. Unfortunately, there are vendors out there who do not provide the same level of service, often because they are large vendors not focused on the small details that matter to an institution. In the next section we’ll explore what to look for in a real estate tax services vendor.
Finding the Right Real Estate Tax Services Vendor
Banks and credit unions can run into problems if they outsource real estate tax services to a substandard vendor. Below are a few important areas to consider when choosing a vendor. Find a vendor who:
- Keeps your portfolio up-to-date by validating and updating data on a consistent basis
- Ensures the correct parcel is always paid, using a system that verifies multiple data points to avoid mistakes (such as a name change or address error)
- Commits to providing tax amount and due date information as soon as it is available
- Has good relationships with all the tax agencies you work with, to expedite and streamline that data gathering
- Offers 24/7 on-demand reporting
- Monitors delinquencies, including a recheck a few months later, so nothing slips through the cracks
- Offers industry-leading customer service to answer questions and handle any issues promptly
Here are a few warning signs of real estate tax services provider who may not be up to standard, and may cause issues for your institution:
- Doesn’t actively monitor your portfolio
- Only checks delinquencies once a year
- Doesn’t verify parcel by multiple data points (this is a common cause of errors)
- Doesn’t care about interest fees or paying early for a discounted rate
- Has lackluster customer service