Lenders: It’s time to go fully digital

BLOG VIEW: The mortgage industry has been ready for a digital revolution for several years, but most lenders have failed to take advantage of the opportunities available to them. It’s time for lenders to embrace digital mortgage technologies and start fully digital implementations. It’s not enough to simply dabble in digital space; it’s an all or nothing proposition, and every lender should choose “all”.

Given how long the industry has been debating digital mortgages, lenders have been understandably cautious, especially when many “innovations” turned out to be nothing more than vaporware or unusable given outside constraints (that’s i.e. investor requirements/acceptance). This caution has opened the door to the emergence of a hybrid model, in which lenders could go digital piecemeal depending on circumstances until they are able to transition to an all-digital mortgage.

Unfortunately, the mortgage industry has been stuck in hybrid purgatory ever since. Fortunately, some lenders are looking to move away from the hybrid model and finally implement an all-digital mortgage, which also opens the door for lenders who haven’t yet gone digital.

Many lenders would say they started the digital transition by offering an online application. While this is a great first step in the digital mortgage process, the key to a fully digital mortgage is closing. For lenders to implement a fully digital mortgage, the closing process must also be fully digital. Of course, one of the main elements of the electronic closing of a mortgage loan is the remote online notarization (RON).

RON has been on the mortgage industry’s radar for several years, but the majority of lenders did not see the need for RON and eClosings until 2020. Now it has become clear just how much a fully digital mortgage would make life easier for lenders and their borrowers. This is why many lenders place great importance on finding the right RON technology in 2022.

For lenders focusing on RON this year, it’s important to evaluate the technology considering several factors, including ease of use, adaptability to existing systems, creative problem-solving options, IT support during RON transactions and regulatory compliance. These features not only allow the RON platform to function properly, but also ensure that the lender finds the right RON platform to meet the needs of all parties involved in the closing process, which brings up another key feature that lenders need to take into account. A truly mortgage closing RON platform should provide the ability to host multiple parties during the online signing/notarization ceremony, including but not limited to lender, borrower, real estate agent and settlement agent.

It’s no secret that our society is becoming more digital every day and the mortgage industry is finally catching up. In 2022, lenders no longer need to start their digital mortgage journey with a hybrid process. The technology and systems are in place, and investor/regulatory acceptance has reached a tipping point where digital mortgages can be executed at scale. Lenders just need to get started. With borrowers prioritizing both speed and convenience, a fully digital mortgage is the next step in the mortgage industry.

Rick Triola is Division President of NotaryCam, a Stewart company, offering remote online notarization and identity verification and authentication.

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