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Case Study: Title Company ABC Implements Managed Service

Accruit

07/28/22

A title company has several customers that routinely complete 1031 exchanges on property held for investment and business use. The title company routinely had to refer customers to a competitor that offers 1031 exchange services because they do not have the resources to complete exchanges in-house. Learn how Exchange Manager Pro’s Managed Service, a white label back office solution for 1031 exchanges, became a solution for this title company.

The Facts

Title Company ABC does the title work for several customers that utilize 1031 exchanges on their real estate transactions for properties held for investment and business use. Because Title Company ABC does not service 1031 exchanges, they must refer these customers out to a competitor that services 1031 exchanges, in addition to title work.

The Problem

As Title Company ABC continues to refer their customers executing 1031 exchanges out to their competitor, eventually, some of these customers moved all their business, including title work, over the competitor to simplify the process by keeping everything with one company.

Because Title Company ABC did not have the time or resources to start a Qualified A person acting to facilitate an exchange under section 1031 and the regulations. This person may not be the taxpayer or a disqualified person. Section 1.1031(k)-1(g)(4)(iii) requires that, for an intermediary to be a qualified intermediary, the intermediary must enter into a written "exchange" agreement with the taxpayer and, as required by the exchange agreement, acquire the relinquished property from the taxpayer, transfer the relinquished property, acquire the replacement property, and transfer the replacement property to the taxpayer. Intermediary needed to service 1031 exchanges in house, they would continue to lose some customers to their competitors and lose present and future revenue – they needed to find a solution.

The Solution: Managed Service by Exchange Manager Pro^SM

Title Company ABC attended a recent Land Title convention held by their state association. While attending, they heard about Managed Service through Exchange Manager Pro^SM, a turnkey, white-label Qualified A person acting to facilitate an exchange under section 1031 and the regulations. This person may not be the taxpayer or a disqualified person. Section 1.1031(k)-1(g)(4)(iii) requires that, for an intermediary to be a qualified intermediary, the intermediary must enter into a written "exchange" agreement with the taxpayer and, as required by the exchange agreement, acquire the relinquished property from the taxpayer, transfer the relinquished property, acquire the replacement property, and transfer the replacement property to the taxpayer. Intermediary solution.

Managed service would allow Title Company ABC to offer 1031 exchanges “in-house” under a custom branded Qualified A person acting to facilitate an exchange under section 1031 and the regulations. This person may not be the taxpayer or a disqualified person. Section 1.1031(k)-1(g)(4)(iii) requires that, for an intermediary to be a qualified intermediary, the intermediary must enter into a written "exchange" agreement with the taxpayer and, as required by the exchange agreement, acquire the relinquished property from the taxpayer, transfer the relinquished property, acquire the replacement property, and transfer the replacement property to the taxpayer. Intermediary entity, while the Exchange Manager Pro^SM team of 1031 experts worked behind the scenes as the back-office facilitating the 1031 exchanges.

The unique nature of Managed Service will allow Title Company ABC to offer and monetize 1031 exchanges without needing to invest or divert scarce resources.

Title Company ABC decided to give Managed Service by Exchange Manager Pro^SM a try. For a nominal upfront set-up fee, they were onboarded as Managed Service clients within days, and they were able to start offering 1031 exchanges to their existing clientele.

The Result

Within a few short months of implementing Managed Service, Title Company ABC has earned roughly $20,000 of new income from the revenue share which is made up of both shared fee and deposit revenue. Additionally, they were able to retain roughly 10 customers that they would have previously referred out to a competitor, and they were able to secure a handful of new customers that were looking for a title company that offered both 1031 exchange and title services under the same roof.

Does this scenario sound familiar? If so, visit to learn more about Managed Service and how it could benefit your company.