There are a number of reasons why title agencies sell their company. It’s only good business sense to have an exit strategy. Title agency owners are often approaching retirement age. Owners who hope to retire soon will find economic benefit in selling their company. Why not capitalize on a lifetime of hard work and relationship building?
Running a small title agency can be extremely intimidating and risky. The horde of risks include wire fraud, escrow losses, and potential title claims. Each new deal comes with a possibility of doing damage to your company. The cost to mitigate the risk of frauds like wire fraud can imperil an agency’s financial viability. Moreover, insurance doesn’t guarantee protection since they will often find any reason not to pay. To illustrate, in a socially-induced wire fraud situation, the cyber theft insurer may say that your system was not hacked and that you should call your E&O insurer. The E&O insurer may then tell you the loss should go to the cyber theft insurer. It essentially turns into an endless cycle of deferring responsibility.
An inconvenient truth in the title workplace is that employee loyalty is rare. Even if you believe you have a great relationship with your employees, often times they’re only concerned about money, and the ‘relationship’ is truthfully nothing beyond the fact that you sign one side of the check and they sign the other. Employees have a tendency to drive owners crazy, making a good case for selling the company. Not having to deal with employees anymore is one of the biggest drivers for sales of title agencies.
Lastly, some title agencies can’t always hold their own against the larger, more developed companies. Large companies can often process the same deals as smaller companies far more efficiently. This is because they have access to technology, resources, and knowledge unavailable or unattainable to smaller companies.