Most real estate firms are typically marred by stacks and stacks of paperwork, ranging from legal forms, property brochures, disclosures, contracts, agreements, and several other documents.
The sheer volume of information, especially the paper-laden kind, that needs to be sifted through every day in the real estate sector can leave you swamped and choke out your resources pretty quickly.
So how do we get around this issue? The answer is Document management solutions.
Document management involves using an automated AI software to access, manipulate, categorize, store, secure, retrieve, and track electronic business files for a business or firm.
Typically, real estate automation solutions help firms store files at a consolidated hub to expedite business workflows and manage documents efficiently. This lets companies and their investors extract and swiftly obtain access to critical information.
The real estate documents must be retained by brokers all across the US, and are regulated by California Business & Professions Code Sec. 10148, which states:
“A licensed real estate broker shall retain for three years copies of all listings, deposit receipts, canceled checks, trust records, and other documents executed by him or her or obtained by him or her in connection with any transactions for which a real estate broker license is required.”
Failure to retain these records is liable for revocation and license suspension by the Bureau of Real Estate. A clarification made effective from January 1, 2015 excludes instant messages, text messages, and tweets (unless generated to be retained or to establish a permanent record). The law includes emails as well.
Document management for real estate firms ensures proper organization of documents, quick document search and find, and provides you with all the relevant paperwork with no delays when dealing with a critical real estate transaction.
Here are some benefits of implementing a robust document management system in your real estate firm -
Real estate agents have several high-value clients, and processing documents for each and every transaction can become a chore pretty quickly. Since a real estate transaction involves dozens of documents, retrieving them for specific clients on short notice can get overwhelming for the agents.
Also, since real estate transactions take anywhere from a couple of weeks to even months to show up in an account, all relevant documents must be retained until the transaction gets completed.
Implementing a robust document management system ensures that your firm stores and preserves documents in an organized fashion and a decent condition, thereby streamlining your data management.
Threats to data security in the real estate sector are always high as agents deal with high-value transactions, and all critical information must be preserved and, if possible, encrypted.
Role-based access control provided by top-notch document management systems ensures that only authorized users have access to specific pieces of content. A real estate document management system also offers better backup and disaster recovery, which helps prevent the loss of information.
To prevent security breaches, you must have a decent real estate document management system in place that prevents third parties and hackers from obtaining access to transactional data.
Every transactional deal in real estate harbors certain legal compliances that must be adhered to at all costs. Having the appropriate documentation in different formats as required by legal authorities is pivotal.
To ensure that you have access to all transactional and legal information from the involved documents, you need to have a document management system. This system will ensure that you do not miss out on any stipulated compliances enforced by the authorities.
Many layers of CRE data provide valuable insights about a property owner, their retained properties, the accompanying financials for those properties, and much more.
CRE data encompasses not only transaction or market data but also several other data points, some of which include -
Ways to leverage CRE document management systems:-
Since real estate documents are associated with a massive pile of paperwork, it becomes imperative to have a real estate document management software in place that offers the following use cases -
CRE comps (comparables) is a term used in real estate appraisal that refers to properties with identical characteristics. CRE comps compare general property information, sale price, sold date, buyers/sellers names, zoning, and cap rate. The cap rate defines the rate of return expected on a real estate investment property.
For instance, if you are considering investing in a property, CRE comps help you gather intel on properties with similar characteristics and provide a price comparison to ensure that the deal you have settled upon is the best one that you will get.
CRE comps get typically used for one of two forms of research -
A document management system organizes several layers of property and sale transaction data in the market to inform CRE comps. This gesture facilitates wise decision-making and ensures that you receive data that is up-to-date.
An offering memorandum is a legal document that describes the objectives, potential risks, and investment terms associated with a private placement.
It comprises a company's financial records, a comprehensive guide of the business operations, management biographies, and more.
Securities, such as private placement that are exempt from registration provisions under federal law, provide disclosure through the offering memorandum.
Investment offerings that require complete registration with securities regulators, such as mutual funds, provide written disclosure to investors through a summary prospectus.
Due to these reasons, a sound document management system is crucial as it helps store and extract relevant information from an offering memorandum, which helps facilitate informed decision-making.
Lease abstraction is the process of obtaining information from the lease and consolidating it into a single, easy-to-read document that facilitates swift analysis. The primary terms in leases are typically broken out in an appendix, which lets the reader extract information even from lengthy lease documents.
However, after renewing the lease, the document might have several appendices, additions and addenda attached, further complicating the process of document parsing and increasing the chances of errors.
This is where you require a document management system that systematically stores lease documents, helps organize lease abstracts, and provides you with access to these documents with no delays.
A competent document management system provides cutting-edge analytics and data validation for lease abstraction. Such a system alleviates the odds of obtaining outputs riddled with human error, further streamlining your real estate business processes.
The rent roll document is often utilized by rental property investors as it helps boost gross rental income and enhances the performance of their property. A rent roll report provides insightful information such as tenant turnover, a rent hike, and the occupancy rate of a property.
The property holders must get their sheets updated promptly after obtaining the rent amount from the tenants, regardless of if it is commercial or residential.
It is pivotal to maintain and systematically organize up-to-date records of rent roll processing to track your property's performance and even provide relevant documental arguments in case of any disputes.
We at Docsumo, provide intelligent real estate document management solutions and enable CRE analysts to extract rent roll data in a structured format, eliminating the need for manual data extraction.
A trailing twelve months (T12) is a financial report that reveals the previous twelve months of operations of a multifamily property. A T12 is applicable for apartment buildings as well as other multifamily property types.
A T12 gets calculated by evaluating a property’s financial reports like balance sheets and income statements. T12 data reports provide lenders and investors with an analysis of the property's performance and ways to boost its value.
Extraction of T12 data reassures the investors and prospects of their real estate investment options, and thus, its well-organized retention is pivotal.
Docsumo is an advanced platform that facilitates the extraction of information into an organized and well-structured format from unstructured PDFs, scanned images, and documents.
Manual data extraction, on the other hand, fall victim to several downsides such as -
Since the documentation sets required are enormous, the process of extraction offered by us is boiled down into the following steps to facilitate swift extraction and compilation -
With the help of Intelligent OCR technology, our software solution extracts and presents data in a well-structured format, and can thus be used to extract financial data, generate a T12, rent roll data, lease abstraction, report analytics, and several more.
With Docsumo, you can reduce your overall document processing cost by 70% reduction 98% accuracy by reducing manual errors and receiving precise data. It also lets you send extracted data by providing integration with API or Webhooks.
An efficient automated system helps extract data and generate finished reports. This step can help iron out most complications in the collection and analysis of data.
We are a preferred choice by several real estate building managers, record keepers, accountants and investors, investment partners, and associates to ensure the safe retention of financial information.
Our professional team at Docsumo aims to eliminate all downsides of manual data extraction with its intelligent categorization of documents complemented by an intuitive UI. Within a few clicks, you can fetch, categorize, and compile heaps of data that gets delivered to you swiftly and is rid of errors.
If you are still unsure how we operate and simplify real estate proceedings, safely store and organize data, and present it to you at a moment's notice, book a free demo with us.
In today’s dynamic business world, filing and archiving official documents in the digital form makes it handy, and works wonders in the future or in unforeseen circumstances.
In this blog, we gather collective insight into industry-best OCR software and draw a comparison. We're not trying to determine the best OCR solution in the industry but help you familiarize you with different features of most-popular automated data extraction solutions and help you find the most suitable one for you.
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Despite dedicating a whole lot of resources to manual data extraction for businesses, it could result in slower turn-around time, especially if the number of documents processed per month is simply too high. There’s always the angle of ‘human error’ involved with manual document processing. So, if you’re trying to automate data extraction for your business but you cannot find a vendor to help you with, this article is for you.