Stewart Information Services Corp. has its sights set on another acquisition to build an end-to-end platform for real estate services and technology: Informative Research, a data and analytics provider that supports mortgage lenders and banks in acquiring and generating customers and processing loans.
If the $ 192 million deal is accepted by regulators as expected, it will be the latest in a series of acquisitions aimed at expanding Stewart’s additional services to lenders.
In addition to being the fourth largest title insurer in the country, Stewart provides rating management services, search and rating, and online authentication and dealership solutions.
A buying frenzy that began last year with the acquisition of United States Appraisals, Pro-Teck Services Ltd. and NotaryCam, continued this year with purchases of Signature Closers in February and Cloudvirga, a digital mortgage lending platform, in May.
These acquisitions have helped Stewart increase its review management, abstract, and other ancillary services revenues five-fold, from $ 16.1 million in the first quarter of 2020 to $ 80.7 million in the second quarter of this year.
Stewart Information Services’ secondary revenue growth
Title insurance premiums and fiduciary fees remain the company’s primary source of income, totaling nearly $ 2.1 billion in 2020. However, Fred Eppinger, Stewart CEO, says the company’s investments in talent, size, services and technology strengthen its performance. -to-end services.
“Stewart continues to invest in creating an end-to-end, customer-centric real estate services and technology platform,” said Eppinger upon announcing Stewart’s intention to acquire Informative Research – or “IR”. “By bringing IR into the Stewart family of companies, we’re further reflecting that commitment and improving our data and analytics skills.”
IR helps lenders optimize customer acquisition, acquisition, and fulfillment
IR will continue to operate as a standalone company and CEO Sean Buckner said the company is “excited to drive the creation of a holistic credit and real estate research service and closing process at Stewart.”
IR provides services to more than 3,000 mortgage lenders, banks, and lenders, helping them streamline the credit process by using data and analytics to drive customer acquisition, and mortgage issuance and processing.
The company’s customer acquisition tools include marketing records selected from a national database of over 220 million consumers and daily MLS notifications that track new offers to identify sellers and their buyers who may be in the market for a mortgage.
Core products for lenders include Trend Credit Data and Trimerge Credit Reports, which merge credit data from all three credit bureaus and remove duplicate trading lines. Lenders can use IR’s CreditXpert Solutions Suite to help prospects improve their credit scores and pre-qualify them with SoftQual, a soft credit query that can be used to connect borrowers to the right credit without compromising their creditworthiness.
When processing loan applications, IR helps lenders automate the process of obtaining property valuations and flood certificates, and reviewing details such as employment and income, assets, and income tax.
Stewart on track to spend $ 524 million on acquisitions under Eppinger
When Eppinger came on board as Stewart’s CEO in 2019, he was looking for ways to transform the company’s business. At the time, Stewart was considering his future after a failed $ 1.2 billion merger attempt by rival title insurer Fidelity National Financial.
In the 18 months ended June 30, Stewart spent $ 332 million on acquisitions – $ 200 million in 2020 and $ 132 million in the first half of 2021. The IR deal of $ 192 million Dollar is Stewart’s largest bet on ancillary services and will bring total spending on acquisitions during Eppinger’s tenure to more than half a billion dollars.
That’s not to say Stewart hasn’t expanded its title insurance business as well – in July the company announced the acquisition of one of the country’s largest independent title agencies, Title First Agency. Thomas Title & Escrow and Prima Title LLC were also acquired in the second quarter, strengthening the company’s presence in Arizona, New Mexico and Texas.
However, Stewart and other title insurers are positioning themselves clearly so that they do not fall by the wayside in digitizing the entire real estate transaction.
Title insurers are catching the wave of digitization
This year, the nation’s largest title insurer, Fidelity National Financial, launched inHere, an end-to-end platform that provides transaction tracking, e-notarization and e-closing services for agents and consumers.
First American Financial Corp., which invested $ 70 million in trust and title technology company Endpoint, recently made an automated title decision engine, Clear2Go, available to independent title agents that enables them to make title decisions about suitable mortgage refinancing on the same day offer and home loan.
The big four title insurers undoubtedly have their eye on a smaller but fast growing rival, Doma, who is breaking new ground by offering “instant underwriting” of title insurance for mortgage refinancing. Doma also offers optimized remote and digital closing and escrow services for all types of mortgages.
Doma, which went public in July via a SPAC merger, says it is able to offer immediate underwriting by using a predictive algorithm to assess the risk of a property title having unresolved liens or ownership problems. The algorithmic search of historical real estate records. Doma’s corporate clients include Chase, Fairway Independent Mortgage, Homepoint, PennyMac, Sierra Pacific Mortgage, and Wells Fargo.
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