TORRANCE, Calif., April 5, 2017— DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, reported a 42 percent increase in revenue for 2016. The company credits its growth to the mortgage industry’s demand for products that enable TRID compliance, eSignatures and eClosings. This is the second consecutive year that DocMagic’s revenue has increased by roughly 40 percent.
“Lenders have been looking for ways to assure TRID compliance since 2015, and DocMagic’s SmartCLOSE™ technology has become the industry’s go-to solution,” said Dominic Iannitti, president and CEO of DocMagic. “Our user base has grown quickly. A lot of existing DocMagic clients saw the value of SmartCLOSE™ immediately. It has also been an entry point for many of our new lender clients.”

SmartCLOSE™ enables lenders to interface with settlement providers and other relevant parties in a secure portal to share, edit, validate, audit, track and collaborate on documents, data and fees. In the past two years, DocMagic has completed numerous key integrations between lenders using SmartCLOSE™, their loan origination systems, and new settlement service provider systems. More integrations are being developed for 2017.

“The number of eSignatures completed has increased significantly since launching SmartCLOSE™ and Total eClose™,” said Iannitti, referencing activity for eSignSystems, a division of DocMagic that provides digital transaction management and electronic storage systems. “Lenders appreciate that they can stay compliant while gaining the speed and convenience of a digital process.”

DocMagic anticipates its growth will continue in 2017. In February of this year, the company completed a successful pilot that enabled one of the country’s largest warehouse lenders to accept and fund eNotes, a transition that Iannitti expects to become a major industry trend in the next 12 to 18 months.

“It’s very simple — at DocMagic, we’re dedicated to addressing the industry’s needs and demands with the very best solutions on the market,” said Iannitti. “That’s been the foundation of our business since we started, and we’re pleased to say that it remains the formula for our growth today.”

DocMagic’s growth plans include ongoing calibration of its infrastructure. To maintain its standard for high quality and service, the company added staff in nearly all functional areas, including senior software developers, project managers, implementation specialists, technical support representatives, integration staff and business development professionals.

progressinlending.com | And The 2017 Winners Are … //

PROGRESS in Lending Association has named the work done by DocMagic a top innovation. As the mortgage industry slowly embraces the Digital Mortgage, DocMagic launched what was dubbed its “Total eClosing solution,” which enables a comprehensive, true 100% paperless eClosing that automates the entire process — from start to finish. Looking back, DocMagic was brought to the forefront of eClosing technology awareness with its participation in the CFPB’s eClosing pilot in 2014. This vendor was 1 of only 12 firms that was invited by the CFPB to participate. If the industry is going to go digital it will need vendors like DocMagic to lead the way. The Total eClose solution includes the seamless incorporation of its eSignature-enabled SMART Documents, a nationwide eNotary network, MERS eRegistry access, eWarehousing, eNotes, a secure eVault, and secure investor eDelivery — all in a single, comprehensive eClosing platform and completely TRID-compliant. There is absolutely no paper involved at any point, at any time.

TORRANCE, Calif., March 16, 2017—DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, announced that it was named to National Mortgage Professional (NMP) magazine’s annual ‘Top 100 Mortgage Employers’ list for 2017. This is the second consecutive year that DocMagic has earned placement on the annual list.

Winners were selected using NMP magazine’s proprietary Mortgage Company Employer Score (MECS), which weighs and scores various areas in a company to arrive at the list each year. A polling of NMP subscribers is used with the following criteria: corporate culture; compensation; day-to-day management; internal communications; marketing; training; resources; long-term strategy; ingenuity; speed; technology; and industry participation.

“Employees are the heart and soul of DocMagic—it’s their ingenuity, dedication, and constant commitment to raising the bar that continues to make us one of the mortgage industry’s longstanding category leaders,” stated Dominic Iannitti, president and CEO of DocMagic, Inc. “We are pleased that National Mortgage Professional magazine has recognized the contributions the DocMagic team makes to the industry, and we’re proud to be selected as a Top 100 Mortgage Employer for the second consecutive year.”

NMP is one of the mortgage industry’s leading go-to sources for extensive news coverage for mortgages, origination, compliance, secondary marketing, servicing, settlement, technology, trending, and more.

By Tim Anderson

The days of no pressure are over. Any lender that hasn’t already waded into the ePool had better be ready to jump. With immense regulatory pressure looming, the old method of just doing something is no longer sufficient. It's time for a new tack.

The recent news about the IRS decision is an ex- ample of this. With all the buzz around this news, we’re already hearing from lenders who are interested in a point solution that will allow them to take advantage of this decision for doing business with the IRS. This makes sense because this is front and center in the news, but since these lenders are not considering how this decision impacts the rest of their business, it’s short sighted.

The 4506-T is just one document and while it makes good sense to make the ordering, accepting, processing, filing and storing that document all electronic, what about all the other documents? The e-signature part of this solution can and should be applied elsewhere in the enterprise. When it is extended, it should be done the same way. If it’s good enough for the goose, it’s good for the gander as well.

Seeking a paperless map. Electronic signatures are more than a digital picture of a signature; they are a process, a ceremony. E-sign is a legal process that includes proof that the borrower actually viewed every document, whether there’s a signature or not. Auditors will demand to know if the borrower actually viewed every document. There are also requirements around whether the signature is embedded or an overlay. There are other requirements around how the lender provides the tamper- evident seal. Investors have a lot to say about what is actually involved.

Providing a common and consistent eSigning experience. These processes can vary by vendor, but using different types of e-sign technology across an enterprise can cause problems with investors, to say nothing of confusing borrowers and degrading the consumer’s experience. Remember, from the consumer’s perspective, there are many other documents they would like to sign electronically. If the lender hopes to get consumer adoption, the same tools should be used across the entire process and borrowers should not be asked to sign some documents electronically and others traditionally.

Lenders no longer have the luxury of gently moving into the paperless world. They need to get in soon and they need to take their entire lending process with them. That means that institutions will be seeking solutions that will get all of the paper out. Lacking that, they will seek out partial solutions that already carry within them the map for the future steps that will get them fully electronic.

The very best way to ensure that is to work with a vendor who can take you down that road as fast and as far as you want to go, but in no case slower than the government requires. Choosing a vendor that can only provide a point or piecemeal solution, without a plan for getting to the next step, will put the institution at risk.

An “e”nterprise solution, from application, to closing, to servicing. A good RFP will go a long way toward separating those players who cannot provide a complete solution from those that can. It will also reveal which vendors understand the nuances—from application all the way to closing and loss mitigation—that could impact the lender’s ability to comply with investor and regulatory guidelines. Moving into electronic lending is no longer a simple, cheap or fast implementation. Like everything else in this business, it requires careful consideration.

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This is part one of a two-part article on the industry-wide transition out of paper-based processes to electronic, from application through to closing and servicing. Tim Anderson is the Director of eServices at DocMagic.

Posted with permission from The Mortgage Executive Magazine.

By Tim Anderson

For years a core group of us has been telling the industry that it’s time to get the paper out of our systems. We’ve performed studies that show paper is more expensive, that it takes more time to process, is usually missing pages or signatures, or gets lost. It took the foreclosure crisis to really bring home to the industry the negative implications of lost or incomplete documents. After billions of dollars in settlements to federal regulators and attorneys, it looks like our industry is finally ready to say goodbye to paper forever, or at least a majority of it.

Anyone who has yet to be convinced will get all the persuasion they need when the Consumer Financial Protection Bureau implements the Three Business Day Rule for mortgage loan closings. When lenders and their closing agents are forced to deliver a correct settlement statement to the borrower three days before closing, they’ll learn just how difficult it will be to get everything right and on time in a paper world. Taking their businesses fully electronic will be the only way to ensure compliance.
The good news is that the vast majority of lenders are already moving in that direction. In January, the industry got a boost when the IRS announced that it would finally be accepting electronically signed documents for the ordering of 4506-T tax transcript orders. The FHA, one of the very few remaining federal government holdouts, is expected to follow suit later this year.

The worry now is how lenders will go about making that important transition. Pushing the point solution. For much of the past decade or so, electronic lending advocates like myself have been urging lenders to quit worrying about their entire enterprise and just pick a process and take it electronic. By taking out the paper in a piecemeal fashion, lenders would at least be moving in the right direction and selling themselves on the benefits of paperless lending in the process. This tactic worked for a number of reasons.

First, it was inexpensive. When it comes to technology systems, it always costs less, in the short run, to isolate your systems and concentrate on a single process. This kind of razor sharp focus lets technologists create workable solutions more quickly. But if we’ve learned anything from the foreclosure process, it’s that there are no truly unconnected systems in our business (or at least there shouldn’t be). Ultimately, the lower price tag enticed more lenders to dip their toes into the paperless world and this was good news.

Second, when the project is kept tight and focused, it doesn't take long to configure and test a solution. This meant technologists could finalize their work faster on isolated processes and deliver successful pilots to lenders more quickly. In the end, a successful test is the only way to convince an executive to move more deeply into a solution.

The biggest reason that partial solutions were beneficial in the early days is that by getting lenders to experience their business without paper, the benefits that researchers promised proved to be real. It became clear to the industry that it really did make sense to do everything electronically.

This prompted more lenders to take another step into the digital world, and another one after that. Because the industry was under no real pressure to make this shift work, many lenders made a gentle transition toward fully electronic systems and are enjoying the benefits today.

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This is part one of a two-part article on the industry-wide transition out of paper-based processes to electronic, from application through to closing and servicing. Tim Anderson is the Director of eServices at DocMagic.

Posted with permission from The Mortgage Executive Magazine.

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@import "/sites/all/themes/docmagic/css/fix-ie.css"; By Brian A. Lee

E- or digital mortgages offer increased speed, efficiency, and savings, but lenders and other industry players still face challenges in implementation.

Fintech investment has skyrocketed in recent years, from $1.8 billion in 2010 to $19 billion in 2015, according to a Citigroup report, but the mortgage industry, by most accounts, has been slow to board that high-speed train. Regarding the adoption of digital mortgages, lenders and other industry players are more apt to be like your old-fashioned parents who outwardly embrace innovation but wind up only using a relatively small percentage of their tech tools and gadgets. Many lenders have engaged in hybrid deals—both electronic and paper—and the end-to-end eMortgage definitely constitutes the logical progression in the marketplace, but obstacles remain in the two major areas essential for originators and mortgage bankers to operate: the source of liquidity to fund loans and the secondary market to purchase them.

The absence of warehouse banks, which serve as that source of liquidity for mortgage bankers willing to adapt their paradigm to accept eNotes as collateral, certainly plays a major role, according to Donnie Martin, EVP at Texas Capital Bank.

“One reason is the revenue model of warehouse banking, which is based on interest income, the interest earned in the time elapsed between the funding of the loan and the sale of the loan in the secondary market,” he says. “eNotes and eDelivery drastically reduce the time it takes to purchase a loan in the secondary market, which has a negative impact on the interest income of a warehouse bank.”

Secondly, the lack of a secondary market constitutes the backend bottleneck for mortgage bankers and warehouse banks with regard to e- or digital mortgages.

“Presently, there are two primary investors in the market for eNotes: the GSEs. To put it simply: if you can’t fund or sell it, you can’t originate it,” states Matt Fair, SVP at Texas Capital Bank. Not all hurdles hindering the widespread acceptance of digital mortgages are structural. The housing crisis and economic downturn affected more than people’s stocks and credit ratings. The challenges that faced the industry during that period all but stopped the development and implementation of digital mortgages, according to Martin. The GSEs purchased the first two eMortgages on the secondary market way back in 2003.

Rated E for Efficiency

Necessity is the mother of invention, it’s been said. Compliance, collaboration, and convenience are strong demands in the mortgage marketplace, and more and more industry players are discovering that an eMortgage can speed those needs.

“There really is a groundswell around eMortgages now compared to any other time in the industry,” says Scott Babin, EVP of Operations at Michigan Mutual, parent company of MiMutual Mortgage, crediting government endorsements of and mandates for the electronic transmission of documents.

Lenders included these highlights of digital mortgages in their commentary to Fannie Mae: operational efficiencies and cost savings, increased data quality, improved risk management, quicker warehouse inventory turnaround times and faster liquidity in the secondary market.

“There is great margin pressure to create operating efficiencies,” adds Babin. The rate environment and increased regulatory burden since the housing crisis did not help the industry’s ‘e-volution,’ if you will. Those things changed but, as mentioned above, the firm focus on efficiencies and savings by financial institutions never does.

“In today’s environment of rising rates an compressed margins, lenders will seek avenues to increase efficiencies and widen margins,” says Martin of the Richardson, Texas-based Warehouse Bank. “[The digital mortgage] can be an effective tool to achieve this goal.”

Despite the challenges, Martin expects that the continued adoption of full digital mortgages, including the eNote, will propagate over the next few years. Linn Cook of LendingQB credits PayPal, ApplePay, and other electronic payment platforms, as well as DocuSign, for boosting consumer acceptance of signature-less transaction technology. Hybrid home mortgages have helped, too.

“Hybrid eClosings [or digital mortgages] have been taking place for many years now and based on results from [the 2014] Consumer Financial Protection Bureau pilot program, consumers see a number of benefits, including a better understanding of the documents, a more efficient process and feelings of empowerment or more control over the closing process,” Martin says. “Driven by consumer sentiment, digital mortgages will continue to be embraced by the mortgage industry and the process will evolve over time.”

Babin seconded the point about technology creating a better consumer experience, a major focus of most mortgage originators in today’s market. The Michigan Mutual executive vice president also pointed out that with recent government adoption of eSignatures on key mortgage documents, such as 4506Ts and FHA 92900As, some lenders have implemented an application process that only papers out at closing.

Radius Financial Group Inc. touted one of the industry’s first comprehensive “eClosings” in October 2016, where the note/collateral was automatically registered with MERS, then securely sent to DocMagic’s eVault, and within minutes rather than days Fannie Mae had the full collateral package. The Norwell, Mass.-based mortgage lender said that eMortgage ease of use will especially appeal to millennials, which will make up 61 percent of new homebuyers in 2017, according to Realtor.com.

Martin, the Texas Capital Bank executive, broached some benefits that digital mortgages afford to warehouse banks. MERS, which serves as the legal registry for eNote location and ownership, facilitates the immediate recognition of a warehouse bank’s security interest in a particular promissory agreement. Digital mortgages also provide for a more streamlined process from the receipt of the note at the closing table to its eDelivery to the secondary market.

“The delivery of eNotes, which in most cases are received by the warehouse bank and delivered to the secondary market investor on the same day as funding, virtually eliminate the complications that can arise out of traditional overnight delivery channels, as packages are not lost, damaged, or delayed due to inclement weather or other external factors.”

Digital Deeds: Slow But Sure

Athird quarter 2016 survey by Fannie Mae and Freddie Mac of 130 “key industry stakeholders,” including lenders, servicers, warehouse banks, settlement providers, and vendors, found that overall adoption of eMortgages has been slow.

The GSE survey asserts that eMortgages continue to gain acceptance among lenders, which are willing to initiate the process while warehouse banks, servicers, and settlement partners, such as title companies, will adopt when requested by lender partners.

According to the GSE survey, common concerns across the various mortgage industry segments include:
•Acceptance by a limited number of investors
•Warehouse line availability
•Lack of key stakeholder readiness: servicers, document providers, custodians, title/settlement agents, etc.
•Implementation complexity
•Inadequate return on investment based on industry volumes
•Lack of uniform adoption of eNotarization and eRecording
•Resource/financial constraints
•GSE policy alignment



The massive changes in mortgage systems and workflows required to implement the TILARESPA integrated disclosures (TRID) perhaps could benefit the industry in the advent of digital mortgages. Or one could argue it cuts the other way with wariness and fatigue holding sway. After all, sweeping industry change with the unavoidable compliance ramifications involves a lot of moving parts and preparations.

“[The CFPB] shined a bright light on the ‘e’ process as the preferred way to meet TRID requirements and consumer education and empowerment, says Dominic Iannitti, president and CEO of DocMagic Inc., a single-solution provider that delivers a fully paperless end-to-end digital mortgage solution. “And Director Richard Cordray says it is the number one thing he wants to see get mainstream adoption before his tenure is up.”

Cook of LendingQB says: “TRID has come and gone and the industry did not implode. Costs are higher, but that was to be expected given the amount of change that occurred. What TRID accomplished was prove to the mortgage industry that major changes to the way that business is done can be accomplished… A side effect of TRID was that it forced lenders to re-think their processes and in some cases improve their workflow. This is a bigger deal than many people think because most lenders are stubbornly resistant to change, even if they know it benefits them.”

So how close is the industry to making end- to- end eMortgages a reality though? As if pointing to the first concern from the above GSE survey, Iannitti says to follow the money trail.

“This will occur when more of the traditional investors begin buying eNotes,” affirms the leader of the Carson, Calif.-based provider of mortgage loan documentation software products and services. “We believe a few large players will be stepping up to support the purchase of eNotes in 2017.”

Bruce Carr, CEO of MiMutual, adds, “The industry needs acceptance by both investors and warehouse banks to have eMortgages attain the level in the industry it deserves. The other big hurdle is municipalities: With limited resources at the municipal level greater acceptance of eMortgages could be very slow.”

Approximately 1,500 of 3,142 counties in the country, covering about two-thirds of the population, support electronic recording, with new counties adopting the digital method each month, according to Jerome Jelinek, CEO and General Counsel of Corporate Settlement Solutions, a settlement provider based in the Cleveland metro. “Hybrid closings are a necessity when the property subject to the mortgage is located in a county not equipped to receive electronic recordings,” Jelinek adds. “The remaining mortgage documentation, however, may be completed electronically, including the eNote. As a result, the digital mortgage process remains mostly unchanged, and the benefits are still received by the lender and the consumer.”

There’s no doubt that industry acceptance of digital mortgages will continue to grow, as structural and technological challenges give way to the relentless pursuit of increased efficiency and savings. For Iannitti of DocMagic, the “e” could stand for an enhanced customer service experience for the homeowner and “dramatically improved execution” for the lender. Those values are easy to embrace.

DocMagic, Inc. is proud to announce that president and CEO, Dominic Iannitti, was honored by HousingWire with its 2016 Vanguard Award, which recognizes top mortgage executives for professional accomplishments and for their positive impact on the industry at-large.

The Vanguard Award list is limited to business unit executives within the housing and mortgage finance spheres, specifically those who stand out as innovators and trailblazers. The bar is set extremely high, so all Vanguard nominees represent the highest caliber and demonstrate substantial industry influence.

“The HW Vanguards continues to impress going into its second year; the winners are second-to-none and this list represents the finest cross section of mortgage talent available,” said Jacob Gaffney, HousingWire editor-in-chief.
This was a momentous year for Iannitti. 2016 saw the launch of two industry-altering platforms at DocMagic, and Iannitti’s role at the helm of those projects no doubt earned him a spot on the Vanguard list.

In the first half of the year, Iannitti led the charge in rolling out SmartCLOSE™, DocMagic’s award-winning collaborative closing portal, a solution for TRID compliance that brings lenders, settlement service providers, and other relevant parties together in a secure environment to share, edit, validate, audit, track, and collaborate on documents, data, and fees. Since its launch, SmartCLOSE has gained rapid industry adoption, proving it to be a true game-changer in loan closing today.

Following the launch of SmartCLOSE™, Iannitti shifted his focus to DocMagic’s single-source Total eClose™ solution, where he once again played an integral role in the project’s conception and development for the marketplace. The Total eClose™ suite contains all of the components needed to facilitate a completely paperless digital closing — from start to finish.

By October of 2016, DocMagic completed the mortgage industry’s first comprehensive eClosing for radius financial group, inc. The eClosing included both lender and closing/settlement agent documentation, eNotarization, eWarehousing and eNote acceptance. Unlike other so-called eClosing solutions (often merely hybrids which still require that certain documents be papered out), DocMagic’s centralized Total eClose™ platform facilitates a truly paperless digital closing, an industry milestone that cannot be underestimated.

“I am very honored and humbled to have been selected by HousingWire’s editorial board to appear on this list of esteemed mortgage executives,” commented Dominic Iannitti, president and CEO of DocMagic. “This award is absolutely the result of our continual technology innovations and the unwavering commitment and enthusiasm of the exceptional team at DocMagic.”

Join the eClosing evolution!

DocMagic recently helped a Massachusetts lender close on a series of fully paperless mortgages! DocMagic’s eclosing technology, Total eClose™ tracked each completely paperless loan process in real time, combining an electronic closing with an electronically signed promissory note and deed of trust!

Stop by booth #50 at the New England Mortgage Expo on January 13th to learn how DocMagic continues to move the needle in digitizing the mortgage process by working with our customers and partners at every stage of their eClosing evolution!

Get Started with Total eClose™ NOW!

DocMagic's eClosing solution seamlessly integrates every component of a totally paperless eClosing process, including:

• Access to an extensive eDocument library featuring eSignature technology
• Generation of a MISMO category one compliant SMARTDoc eNote
• eNotarization technology for all 50 states
• Direct connectivity with the MERS eRegistry
• Long-term storage within a secure, certified eVault
• An Investor eDelivery channel
• An irrefutable Audit Trail for proof of compliance
• Backed by a $5M set of Reps & Warrants, our TRID compliance is guaranteed

Let us show you the benefits of working with a single eClosing provider!{{cta('be1de92d-98a6-4e3d-9c3a-ed63eba9b4c6','justifycenter')}}

The holidays always offer an opportunity to reflect on the past year, to recall the moments and people that made this or that year such a success. First and foremost, all of us here at DocMagic wish to thank you for the loyalty and trust you, our clients,extended to us over this exciting year. 2016 has been an amazing year for this company and the industry as a whole.  Allow me to highlight some of the year’s milestones.We started theyear with a bang when we announced the rollout of Total eClose™ at DocMagic’s “The eFuture is Now” bash at LA Live for the MBA’s annual Tech Conference.  A massive turnout of guests learned about our newest innovation and danced the night away in gifts of comfy bunny slippers… inspired by our mascot and spokesperson “Doc”.  The success of this occasion foreshadowed a banner year of growth in all areas of our business.

From the introduction of both the SmartCLOSE™ and Total eClose™ solutions, we have experienced record business growth, resulting in the need for some of the new faces you may have encountered at our headquarters. It has been a spectacular year for adding new clients and strategic partnerships, and to provide a heightened level of service quality, we’ve added an account management tier within the Customer Support Department.  We launched our NEW Premium Reps and Warrants Program to great support. Our eVaulting service took off with several of the nation’s largest financial institutions, and DocMagic’s NEW investor eQC service began delivering automated data and compliance services to investors.

While our internal tech wizards were burning the midnight oil to develop these solutions for our clients, we were selected to be the lead participant in the State of North Carolina’s eClosing Pilot, and DocMagic was named to the vendor technology advisory boards of both Fannie Mae and Freddie Mac.  Most significantly, we executed many of the first paperless eClosings in the country and all participants worked hard to change the landscape of the industry by helping make the digital mortgage a reality.

We are so proud of our accomplishments and the employees that made it all possible. Year after year DocMagic invents and refines products and services that keep our clients compliant, successful and working smarter.  Our commitment remains the same -- to provide the best loan document, automated compliance and eServices solutions available… anywhere.

We extend warm wishes for a joyous Holiday Season and look forward with optimism to what lies ahead in 2017.

 

This fall, a Massachusetts lender closed on a fully paperless mortgage. The work that led to this rare achievement captures the difficulties originators still face in digitizing the loan process.

Radius Financial Group in Norwell electronically closed six loans beginning in October. The process was created in partnership with the tech vendor DocMagic, the MERS loan registry, Fannie Mae and Santander Bank.

Electronic closings and e-notes have been kicking around for a long time. Fannie Mae and Freddie Mac have purchased e-mortgages since the early 2000s. But they remain rare, partly because there are few warehouse lenders that can handle these transactions. Rarer still are completely paperless loan processes that combine an electronic closing with an electronically signed promissory note and deed of trust.

Lately, however, momentum has been building to accelerate the move toward paper-free mortgages. A report last year from the Consumer Financial Protection Bureau found that transactions were faster and borrowers walked away feeling better when a loan was closed using digital means rather than paper.

While the choice to push for a digital mortgage process was largely a matter of improving the customer experience, it also has bottom-line benefits for the company as well, Radius co-founder and Chief Operating Officer Keith Polaski said.

"The first thing for us was the consumer experience, but without a doubt there are tremendous derivative economic gains and efficiencies," Polaski said. "At the end of the day, decisions are made on surrounding economics. If I can save myself 200 bucks a loan, we should be looking at that."

The first loan done through the completely paperless process was closed on a Friday morning at the closing attorney's office "with cups of coffee and chocolate chip cookies," Polaski said. Radius had its technical staff on-site for the first two e-closings to ensure the process went smoothly.

The documents were signed using a tablet. (Notarized documents were also signed with ink for recording purposes because Massachusetts does not yet allow registries to accept electronically notarized documents, though the note and all other documents were electronic.)

That same day, Fannie Mae purchased the loan from Santander, the transaction's warehouse lender.

"For every [paper] transaction, there's five FedExes for that note — those go away," Polaski said. "How fast things turn around will save money."

More than 3,000 miles away, in Torrance, Calif., DocMagic followed the closing as it happened.

"What was interesting about the transaction was our ability to monitor its progress in real time," DocMagic CEO and President Dominic Iannitti said. "Because we were controlling all of the different web service calls that collectively made up that entire process, we were able to monitor it from our offices and watch it transpire without actually being there."

These half-dozen loans were the culmination of a journey that took more than two years. It began when Radius was approached by an aggregator — Polaski declined to identify the company by name — about working together on an e-note pilot program, having heard of Radius' interest in this area. After a promising start, this project ultimately fell through.

"All of sudden everyone was moving in the right direction and then it stopped," Polaski said.

Still the experience positioned Radius well to keep trudging along. In August 2015, Radius received seller-servicer approval from Fannie Mae, a process that Polaski said took roughly four months. Then, the company lined up its e-note approval from Fannie, which Polaski said took only 45 days thanks to the work already completed in the e-note pilot program.

"We were lucky because we had done a lot of the MERS and e-vault work ahead of time," he noted.

Radius and DocMagic were not the only parties to the closing that had to get the proper technology in place. Massachusetts is an attorney-closing state; Radius' closing agent had to get approved as an electronic notary from World Wide Notary, a vendor. This required him to obtain an electronic signature pad and install and learn software.

Perhaps the biggest challenge throughout the entire process though was securing a warehouse lender that was equipped to do electronic closings; there are only a handful of such providers.

"There are only a few e-warehouse lenders and that is definitely a factor," Iannitti said. "If you don't have a company that's ready to purchase that e-note then you haven't really accomplished anything at all."

Santander did not make executives available for interviews. According to Polaski, the bank had been pursuing the e-warehouse business for more than two years, and company executives even had to travel to the bank's parent company in Spain to receive the OK.

"The stars were aligned and we finally had everybody aboard," Polaski said.

The next step was identifying the borrowers from the large pool of customers who already had a digital relationship with Radius from the application stage and could act as guinea pigs for the new closing process. That included making sure they were "friendly," Polaski said, "because if stuff went sideways we wanted to be able to put a paper note in front of them and have them understand they were part of a pilot."

With a handful of loans closed, Polaski said, Santander is now reviewing the experience before it moves forward with further e-warehouse lines. He expects that his company will move "robustly" into the e-closing space next year.

Radius is close to receiving Freddie Mac seller-servicer approval. Currently, the company hopes to sell roughly 20% of its originations to the agencies annually; the company is aiming for $1 billion in originations total next year. Selling to Fannie and Freddie is one piece of its e-close strategy. One remaining obstacle Polaski sees on the horizon is the lack of aggregators willing to purchase these loans.

"If the only place to sell these loans is Fannie, I just don't have the execution there," Polaski said. "If I had a handful of aggregators step in, I think we would move the entire book of business to e-note if the consumer has e-consented."

DocMagic, meanwhile, came out of the transactions with no items left on its to-do list. And while the move toward greater adoption of e-closings has been a slow one, Iannitti said he is happy with where things are.

"We're very pleased with the rate of adoption and rate of interest that we're seeing right now," Iannitti said. "It definitely took longer than we thought, but now we're seeing the momentum and feel that everything is moving in the right direction."

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