NEWPORT BEACH, Calif., March, 25 2019—NotaryCam®, the leader in online notarization solutions, today announced that eMortgage pioneer Mid America Mortgage is now using the firm’s integration with DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, to conduct remote online notarizations (RONs) through DocMagic’s Total eClose™ platform. Mid America will leverage the integration throughout its retail, correspondent and wholesale channels.

“Since 2016, Mid America’s strategy has been ‘digital first.’ As a result, we have been able to condense our application-to-closing time down to just two weeks and our closing ceremony to 30 minutes or less with our digital mortgage product Click n’ Close,” said Mid America Owner and CEO Jeff Bode. “RON allows us to double down on our closing efficiency while also providing additional convenience to our customers. The addition of NotaryCam’s remote notary services through our established eClosing partner DocMagic enables us to extend the value we’ve experienced to date through our digital mortgage strategy.”

To date, NotaryCam has conducted more than 160,000 RON transactions for individuals located in all 50 states and 90 countries. Thanks to RON bills that have been passed by multiple states, Texas included, NotaryCam’s team of highly trained and experienced notaries are able to remotely eNotarize mortgage loan documents or other paperwork for individuals across the country using NotaryCam’s secure, easy-to-use platform. The system does not restrict the number of participants that can join a RON ceremony, allowing all relevant parties to participate in the transaction.

“Until recently, mortgage closings still required participants to physically congregate in a single location to complete the transaction. Today, RON enables lenders and settlement agents to eliminate the closing table without losing the personal connection of the closing ceremony,” said NotaryCam Founder and CEO Rick Triola. “The value of the convenience that RON provides cannot be overstated, and it would behoove mortgage and settlement professionals to incorporate RON into their existing closing process.”

Total eClose is DocMagic’s comprehensive end-to-end eClosing solution. The integration with NotaryCam, which was first announced in September 2018, allows Mid America Mortgage and Click n’ Close to eNotarize documents remotely using NotaryCam’s RON service, eliminating the need for home buyers and sellers to physically appear before a notary to wet-sign loan documents.

“We continue to focus on implementing seamless digital closing solutions for our customers,” stated Dominic Iannitti, president and CEO of DocMagic. “Mid America’s accelerated processes highlight the benefits DocMagic delivers for both lenders and borrowers. The added efficiency of NotaryCam’s RON solution is the logical next step and a key component to achieving 100% paperless eClosing transactions.”

Online eMortgage Education Module was developed to help attorneys, title agents and notaries successfully conduct eClosings

WASHINGTON, D.C., Oct. 15, 2018—Secure Insight, a New Jersey-based data intelligence and vendor management firm, announced today at the MBA’s Annual Convention & Expo that it teamed with DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, to develop and host an online training program to teach attorneys, title agents, notaries and other entities how to accomplish clear, compliant and completely paperless eClosing transactions.

Secure Insight noted that while lenders have made good progress installing digital mortgage point-of-sale solutions, it is just the initial step to implement a true eClosing solution. DocMagic developed Total eClose™, a comprehensive solution that enables a 100 percent paperless eClosing process from start to finish using a single-source vendor.

“Getting over the adoption hump starts with ease of use and adequate training so users feel comfortable conducting business within the eMortgage ecosystem,” stated Andrew Liput, president of Secure Insight. “We partnered with DocMagic because their Total eClose solution is one of the easiest and most intuitive in the industry, which is conducive to adoption for title agents, attorneys and notaries to understand and leverage.”

Secure Insight has an extensive database of more than 70,000 closing professionals that can take advantage of this vital training program, which provides the educational foundation that paves the way for their business practices to include eMortgages and eClosings. Lenders are increasingly seeking well-qualified professionals to work with and this wide-scale training program is poised to significantly move the adoption needle.

Company officials at Secure Insight say their ultimate goal is to become the industry’s go-to resource for lenders to access settlement professionals who are well-trained in eClosings, similar to what the Nationwide Multi-state Licensing System & Registry (NMLS) provides for loan officers. Lenders can provide a list of approved title companies and Secure Insight then works to implement a common and consistent process for training on a national level.

Tim Anderson, director of eServices at DocMagic stated: “The new training program and centralized database will provide key information and knowledge for professionals about our industry-leading Total eClose technology and assist lenders in locating professionals who are qualified to leverage it for the benefit of consumers. Further, one of the primary issues it solves is that in a purchase market, lenders really don’t choose the settlement professionals and typically don’t have direct relationships with them either nor the dedicated resources to continually train them to effectively support full eClosings. The online training eMortgage Education Module helps alleviate this impediment.”

The online training is officially set to launch on November 15, 2018 and will be available through a link on Secure Insight’s website. To learn more, contact Secure Insight at info@secureinsight.com or (877) 758-7878.  The company will also be holding discussions at the MBA’s Annual Convention & Expo from Oct. 14 – 17 at the Walter E. Washington Convention Center in Washington, D.C.

MBA and ALTA are collaborating to make it easier for states to accept remote online notarizations

NEWPORT BEACH, Calif., Sept. 27, 2018—DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, and NotaryCam the leader in online notarization solutions, announced an integration that eliminates the need to wet-sign loan documents in the physical presence of a notary by allowing loan documents to be quickly and compliantly eNotarized online.

The integration works inside Total eClose™, DocMagic’s comprehensive end-to-end eClosing solution. It allows customers to initiate eNotarizations using NotaryCam’s remote service with just a few clicks, thus extending the convenience of a fully online eClosing experience through notarization – the final step in loan closing — without any hard stops or papering out.

“More and more states are permitting remote online notarization and as they do, we can expect to see consumer demand and expectation for remote eNotarizations to grow,” said Dominic Iannitti, president and CEO of DocMagic. “This integration allows DocMagic customers to meet consumer demand without any delays, which is a big part of our value proposition for all DocMagic products.”

The Mortgage Bankers Association has been collaborating with the American Land Title Association (ALTA) to prepare model legislation that would provide a framework for any state to adopt remote online notarization processes.

“Mortgage eClosings have progressed incrementally, and both DocMagic and NotaryCam have been pioneers and champions in the adoption the industry has achieved—so this integration is a natural fit,” said Rick Triola, founder and CEO of NotaryCam. “Our companies are very similar in what we deliver: the industry’s most flexible and customer-friendly experiences, backed by unfaltering accuracy, data integrity and compliance. We are looking forward to moving the industry forward, together.”

Prior to the addition of NotaryCam, DocMagic’s Total eClose solution supported eNotarizations by leveraging in-person notaries equipped with electronic notary signing technology, which it will continue to offer in addition to remote online notarizations, where permitted. Both DocMagic and NotaryCam are approved eMortgage technology vendors with the GSEs, having passed an extensive approval process.

A complete eClosing solution for Lenders One members to help accelerate the eMortgage journey

SALT LAKE CITY, Aug. 06, 2018 (GLOBE NEWSWIRE) -- Lenders One Cooperative, a national alliance of independent mortgage bankers, today announced the launch of Lenders One^® eClosing by DocMagic, a complete eClosing solution for borrowers, lenders and investors. The eClosing solution provides an entirely paperless workflow that integrates every component of the closing process and guides users through each step.

Launched for Lenders One members today at the Lenders One Summer Conference in Salt Lake City, Lenders One eClosing by DocMagic is evidence that eMortgages and eClosings are no longer a future-state vision. When using the solution, the average loan closing “at the table” can be reduced from 60 minutes to 15 minutes, helping to dramatically improve the borrower experience. 

The solution includes the following features:

• Integrated with all of the major LOS platforms to generate e-enabled documents.
• An embedded compliance engine that automatically audits documents and data against applicable industry laws and regulations to help ensure compliance throughout the loan lifecycle.
• eNotary technology for in-person electronic notarization or remote online notarization where permissible.
• The ability to deliver a MISMO SMARTDoc^® eNote with direct connectivity to the MERS^® eRegistry.
• A secure, certified eVault which provides long-term storage and eDelivery to warehouse banks and investors and features a date-stamped and time-stamped audit trail to help show proof of compliance at all times.

“Our eClosing technology puts Lenders One members at the forefront of the eMortgage evolution, a sought after capability made possible through our collaboration with DocMagic,” said Michael Kuentz, CEO of Lenders One. “Importantly, the eClosing solution incorporates feedback received from our members and service providers, helping ensure we address their needs. Our comprehensive eClosing solution provides our members with options to choose full eClose or hybrid eSign/ink-sign workflows. The technology adapts to the lender’s production environment and compresses the overall timeline to loan sale, generating material savings for lenders facing historically high loan production costs.”

“Effective implementation of eClosing begins with a well-defined eMortgage strategy, and by working in concert with Lenders One, we are helping originators set up their eClosing production lines at a pace, and in a manner, that is consistent with their overall business goals,” said Dominic Iannitti, President and CEO of DocMagic. “The deep working relationships that Lenders One has established with its members are critical, and through our combined strength we are accelerating the eMortgage journey for progressive lenders nationwide.”

About Lenders One^® Cooperative 
Lenders One (LendersOne.com) was established in 2000 as a national alliance of independent mortgage bankers, correspondent lenders and suppliers of mortgage products and services. Participants on the Lenders One platform originated approximately $270 billion of mortgages during 2017, collectively ranking as one of the largest retail mortgage entities in the U.S. Lenders One is managed by a subsidiary of Altisource Portfolio Solutions S.A.

About DocMagic 
DocMagic, Inc. is the leading provider of fully-compliant loan document preparation, compliance, eSign, eDelivery and comprehensive eMortgage services for the mortgage industry. Founded in 1988 and headquartered in Torrance, Calif., DocMagic, Inc. develops software, mobile apps, processes and web-based systems for the production and delivery of compliant loan document packages. The company’s compliance experts and in-house legal staff consistently monitor legal and regulatory changes at both the federal and state levels to ensure accuracy. For more information, visit www.DocMagic.com

About Altisource^®

Altisource Portfolio Solutions, S.A. (NASDAQ: ASPS) is an integrated service provider and marketplace for the real estate and mortgage industries. Combining operational excellence with a suite of innovative services and technologies, Altisource helps solve the demands of the ever-changing markets we serve. Additional information is available at altisource.com.

Integration provides borrowers with a digital mortgage process from POS through closing

TORRANCE, Calif., June 5, 2018  — DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, and MortgageHippo, a Fintech-driven digital lending platform, announced a seamless eSign integration between their two platforms.

This integration enables MortgageHippo’s lender customers to provide borrowers with the ability to electronically sign documents at any stage of the mortgage process, from point-of-sale to closing. eSignatures eliminate the time constraints and accessibility limitations of manual signatures, thus providing lenders with a faster mortgage process and reduced origination costs. The eSignature process that MortgageHippo provides via DocMagic is as legal and valid as a manual process using printed and wet signed documents.

MortgageHippo provides mortgage lenders with a comprehensive suite of white-labeled web and mobile-ready products that enable a modern, efficient, secure and fully online borrower experience from the point-of-sale to closing.

Lenders can order disclosures directly from their loan origination systems (LOS), most of which are already integrated with DocMagic. MortgageHippo then provides eDelivery of the disclosures to the consumer via the MortgageHippo borrower portal for compliant eSigning using DocMagic’s eSign technology. This service is available for initial disclosures, Loan Estimates (LE), Closing Disclosures (CD) and closing documents.

“If lenders want to stay competitive, they need the tools to satisfy borrowers’ growing appetite for an easy and robust digital experience,” said Joe Dahleen, EVP and CSO at MortgageHippo. “MortgageHippo’s integration with DocMagic allows us to provide those tools to lenders by offering eSignature capability throughout the entire mortgage process.”

“We are pleased to partner with MortgageHippo and offer our mutual lender clients a strong digital mortgage point-of-sale solution that integrates tightly with our platform and LOS partners,” said Steve Ribultan, director of business development at DocMagic. “Integrating with MortgageHippo is yet another step that DocMagic is taking to deliver on the promise of achieving a truly paperless digital mortgage process.”

About DocMagic:
DocMagic, Inc. is the leading provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions for the mortgage industry. Founded in 1988 and headquartered in Torrance, Calif., DocMagic, Inc. develops software, mobile apps, processes and web-based systems for the production and delivery of compliant loan document packages. The company’s compliance experts and in-house legal staff consistently monitor legal and regulatory changes at both the federal and state levels to ensure accuracy. For more information on DocMagic, visit https://www.docmagic.com/.

About MortgageHippo: 
MortgageHippo works with lenders to devise and implement their digital mortgage strategies using its borrower-centric digital lending platform. The MortgageHippo platform allows lenders to deliver a modern borrowing experience, improve borrower conversions, significantly reduce origination costs and integrate with other innovative technologies. MortgageHippo’s platform is fully customizable to lender preferences and configurable to lenders’ workflows and processes. For more information, visit http://www.mortgagehippo.com.

Borrowers can have a 10-minute closing appointment when reviewing and electronically signing documents in advance

DocMagic, Inc., the premier provider of fully-compliant loan document preparation, regulatory compliance and comprehensive eMortgage services, announced that retail mortgage lender Guaranteed Rate can now cut closing time by electronically signing mortgage closing documents in advance.

Guaranteed Rate has branded the solution FlashClose, which allows customers to opt-in, review and complete most documents in advance of the notary arriving, saving an hour or more at the closing table – with some averaging a mere 10-minute appointment to provide inked signatures.

“Guaranteed Rate is always looking for ways to simplify the process using innovative technology to enhance the customer experience,” says Jim Hettinger, executive vice president of operations for Guaranteed Rate. “With the successful launch of FlashClose, powered through our partner DocMagic, this tool adds speed, convenience and accuracy to the closing process.”

“Guaranteed Rate is a leader in mortgage technology innovation and collaborating with them on this project has created a solid hybrid eClosing approach that saves a lot of time for both borrowers and closing agents,” stated Dominic Iannitti, president and CEO at DocMagic. “The fashion in which Guaranteed Rate is leveraging our technology has resulted in the successful adoption of a sound, compliant, secure hybrid eClosing that is unique to their retail lending business strategy.”

Of note is that DocMagic offers a comprehensive eClosing solution called Total eClose™ that delivers fully paperless closings from start to finish. DocMagic’s proprietary eSign platform is a component of Total eClose and can be accessed and implemented by lenders to help automate the closing process.

For more information about FlashClose, visit https://www.guaranteedrate.com/flashclose.

About DocMagic:
DocMagic, Inc. is the leading provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions for the mortgage industry. Founded in 1988 and headquartered in Torrance, Calif., DocMagic, Inc. develops software, mobile apps, processes and web-based systems for the production and delivery of compliant loan document packages. The company’s compliance experts and in-house legal staff consistently monitor legal and regulatory changes at both the federal and state levels to ensure accuracy. For more information on DocMagic, visit  https://www.docmagic.com/.

About Guaranteed Rate:
Guaranteed Rate is one of the largest retail mortgage lenders in the United States. Headquartered in Chicago, the company has approximately 210 offices across the U.S. and Washington, D.C., and is licensed in all 50 states. Since its founding in 2000, Guaranteed Rate has helped hundreds of thousands of homeowners with home purchase loans and refinances and funded nearly $19 billion in loans in 2017 alone. The company has become the Home Purchase Experts® by introducing the world’s first Digital Mortgage technology and offering low rate, low fee mortgages through an easy-to-understand process and unparalleled customer service.

Guaranteed Rate won an American Business Award for its Digital Mortgage technology in 2016, ranked No. 1 in Scotsman Guide’s Top Mortgage Lenders 2016, was chosen as Top Lender 2016 and 2017 by Chicago Agent magazine, made the Chicago Tribune’s Top Workplaces list seven of the past eight years, and was named Best Overall Online Lender and Best Lender for FHA Refinance by NerdWallet in 2018. Visit https://www.guaranteedrate.com/ for more information.

The Whole is Greater than the Sum of its Parts When it Comes to Digital Mortgage Solutions and eNotes

By Tim Anderson,
Director of eServices, DocMagic, Inc.

Having worked in the mortgage industry for over 30 years, I’ve pretty much seen it all. As a mortgage technologist, I’ve watched vendors and lenders alike create hype around various technologies and new buzz words over the years, only to see so many of them never gain adoption or provide value. Sometimes, the rollout is flawed or it’s an outright failed go-to-market strategy. I recall when the likes of Service Oriented Architecture (SOA), Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), cloud-based computing, and so many others instantly became attractive terms and acronyms with mortgage technology vendors flocking to incorporate them into their marketing speak—whether they delivered on their promises or not.  

Collaborating closely with the GSEs, investors, lenders, servicers, warehouse lenders, and many other industry participants, I’ve worked to forge ahead and evangelize the far-reaching benefits of a comprehensive “eMortgage” process, a term that has essentially been replaced by “digital mortgage.”  No matter what you call it, it’s always been about replacing and automating paper-based processes with automation.

Now we’re living in a world of digital mortgage. We’ve seen many new and small software companies pop up, driving hard to attract lenders with slick marketing speak and often low price points for what is sometimes immature, unproven technology.  

Many of these newbies don’t have the much-needed mortgage industry domain experience needed to succeed, as some vendors stumble once they become immersed in the overwhelming minutia, nuances, and complexities of the mortgage manufacturing process. On top of that, even some well-established mortgage technology vendors have jumped on the “me too” digital mortgage bandwagon.

Who can blame them? It’s a shiny new object that lenders are naturally drawn to. How can we forget TRID readiness? Remember when so many tech vendors became TRID compliant virtually overnight, offering some sort of solution—of varying degrees? However, that was far from reality; it was mostly just vendor marketing speak.

The mortgage industry has slowly but surely been working to achieve a true end-to-end digital mortgage process that is fully integrated and 100 percent paperless. But the reality is that, while progress has been made over the past few years, the industry as a whole still isn’t fully grasping everything that is needed to create a total, seamless, comprehensive and scalable digital mortgage solution. Many vendors are still falling short.

Of note, however, is that some of the new entrants that automate the point-of-sale have, in fact, done an outstanding job. Being able to instantly pull and validate things like VOE, VOI, VOA/banking information, IRS/tax returns, etc. while at the point-of-sale has definitely been a huge help to supporting the digital mortgage cause to elevate the borrower experience.  But there is a lot more that needs to happen thereafter, such as a full eClosing.

Is digital mortgage about the borrower experience?  In part, yes. But it also encompasses so much more. Value is gained for nearly all the participants in the digital mortgage process, but only if it’s done right.  What do I mean by right? The technologies cannot be siloed, poorly integrated, or offer just enough automation to address bits and pieces of the process in order to get by for now. Digital mortgage for the consumer is starting ‘e’ and staying ‘e’ with the same common and consistent end-user experience.

The Digital Mortgage Challenge
There is no way to say this tactfully. It’s the tech vendors that created the problem and continue to create confusion in the marketplace. I can’t be more pointed when I say that the mortgage industry, for the majority of vendors, is a big, fat fail. It isn’t the lender’s fault.

Many digital mortgage technology providers (both newbies and established vendors) are offering one-off pieces of the overall process. These solutions are merely workarounds that most often create inefficient stopgaps in the workflow, communication challenges, integration breaks, compliance risk, solution deficiencies, and other problems.

Use of an eVault Isn’t a Digital Mortgage
Some applications create initial excitement and address components of the overall problem. For instance, lenders can jump into the digital mortgage arena and store their loans in an eVault, but that doesn’t mean the promissory note includes all of the necessary documents to ensure a legally compliant closing.  

Some solutions just OCR docs and store them in an eVault, which isn’t always 100 percent accurate; anytime you are manipulating a source document, there is always the risk of errors and omissions that could easily get lenders into trouble at a later date. And what if something changes? How are they adjusted and properly tracked to ensure a full audit trail and electronic evidence of compliance within an eVault?

A Complete Digital Mortgage Solution
Put simply, make sure that you are dealing with a vendor that has a proven, single-source solution that supports all documents and functions that you need to deliver a complete digital/paperless process to the consumer and across multiple lending entities.

This all starts at the time of application with MISMO SMART Doc creation and management (TRID compliant initial disclosures to the borrower and the LE/Loan Estimate). You, of course, need eSign technology to securely and compliantly allow the borrower to sign all documents throughout the mortgage process.

Lenders must also implement a comprehensive eClosing technology platform, where the LE/Loan Estimate and CD/Closing Disclosures are automatically compared and matched for any change of circumstance and TRID compliance. eNotarization capability needs to be integrated into the documents and the process as well. MERS eRegistry of the note is a requirement. All documents, signatures, and proof of compliance must be stored in a certified eVault.  

Also, seamless integrations must exist with the lender’s LOS platform to auto-generate smart documents (embedded signatures and notary tags) from the start, as well as integrations with the title company software platforms to do the same with their documents. Delivery of not only the eNote but all critical closing documents to investors/GSEs is made to be quick and easy. A fully integrated platform and process includes everything from the warehouse lenders to eMods and refis within the servicing system as well as what I consider a cradle-to-grave, lights out digital mortgage technology solution.

It’s a total, fully paperless digital mortgage—one that doesn’t involve lots of different vendors doing their best to work together—whether it’s de novo software providers, aggressive fintechs, on down to the long-time mortgage technology incumbents.

We need to deliver actual, comprehensive solutions to the industry that are fully integrated and scalable, not bits and pieces/hybrid offerings. Put simply, they just fall short of achieving a total solution. It’s a menagerie of vendor hodgepodges, which are mostly light applications that only address parts of the overall digital mortgage process.

Digital Mortgage Hype versus Reality 
Beyond a shadow of a doubt, I feel that the mortgage industry was steered in the wrong direction from the beginning by tech vendors that were all too eager and rushed to launch and market some sort of digital component offering. By and large, many tech vendors did so in order to effectively compete. Marketing puffery can easily trick unsuspecting ultra-busy lenders.

Going completely paperless really boils down to two factors:  

1. Implementation of a comprehensive digital mortgage technology solution; and
2. lender adoption of e-automate everything, not just pieces of the process. The mortgage industry still faces an uphill adoption curve.  

There are, however, some complete end-to-end solutions available on the market today from single-source vendors. Those lenders that implement the right end-to-end digital mortgage technology now will have a significant competitive advantage over those who remain in a wait and see mode or those that merely dip a toe in the water, adding a multitude of different hybrid vendors. It just doesn’t work well and by no means is it a long-term digital mortgage loan production, workflow, and back-office business strategy.

Before buying any type of digital mortgage technology, be sure to fully educate yourself and conduct deep-dive due diligence on everything you will need to implement a successful total digital mortgage solution from soup to nuts. Think of where you want to be 18-24 months out. Implementing a short-term solution will likely later need to be replaced by a complete solution. Your long-term viability and success depend on making the right choice the first time.

As featured by MReport, April, 2018

About Tim Anderson

Tim Anderson is the Director of eServices for DocMagic, Inc. He has held executive management positions with LPS, Stewart, Fidelity, FreddieMac and HomeSide Lending where he ran the eCommerce Division and worked at technology companies like Dexma, Microsoft and Tuttle Information Services. He was also the original founder of the eMortgage Alliance which promoted MISMO standards for delivering legal paperless processes.

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National Mortgage Professional Magazine recently sat down with Tim Anderson, Director of eServices at DocMagic, to gain insight and trending into the mortgage industry’s current progress and needs to achieve a completely paperless lending transaction. Tim is a subject matter expert in end-to-end digital mortgage processes, electronic compliance and supporting eServices, among an array of other mortgage technologies. He has more than 30 years of industry experience working on both the lender and vendor side of the business.

NMP: Lots of attention has been placed on the importance of digital mortgages as of late, in particular in the last 18 months. Why the sudden rush?

Tim Anderson: The advent of fintechs to focus and improve on the consumer experience in order to capture more business has been significant. Couple that with the government-sponsored enterprises (GSEs) moving their traditional post-closing pre-funding review process to a more automated pre-closing quality control (QC) process, along with Day One Certainty and Loan Quality Advisor, and these have become major factors and drivers of change.

eMortgage services that facilitate a paperless lending process have been available for quite some time, but industry-wide adoption has been slow up until lately. However, you are with an organization that is currently at the right place at the right time. Can you elaborate as to how you got here?

The mortgage industry, as a whole, takes quite a long time to flex with significant changes, especially from its entrenched paper-based processes, which is a long-term commitment. At DocMagic, we developed our own eSign technology back in 2011. We later acquired eSignSystems from WAVE in 2014 to add a total enterprise on-premise eSign, eClosing and eVaulting solution for lenders and vendors to implement within their own firewalls. With great fanfare, we launched our hosted Total eClose SaaS version in the spring of last year.

The mistake that many people make, however, is that they think eSign equates to eMortgages and that couldn’t be further from the truth. It is so much more involved than licensing an eSign tool. There is a dominant eSign player out there today that focuses on serving multiple industries, but the ability to auto-enable all the legal documents required to facilitate a legal and compliant closing, including the GSEs’ requirements to deliver a category one SMARTDoc eNote takes a level of sophistication and industry knowledge that no eSign tool or dumb PDF-based doc provide can deliver. That is why DocMagic is in a unique position to deliver a “total” solution, (eSign, eClosing, eVault, eDocuments, eNotary) than most vendors that are just hocking a technology that lenders still must figure out on how to implement on their own.

Believe me, when you are a national player and you start looking at the magnitude of creating and supporting thousands of mortgage templates for closing documents that are dynamic and variable, those types of broad, non-industry focused systems are not sustainable and just won’t scale with industry complexities and constant regulatory changes.

DocMagic’s technology facilitated most of the nation’s first successfully completed eClosings. What can the industry learn from those eClosings?

This is a very insightful question. We knew early on that as eMortgages became mainstream many “Johnny-Come-Lately” companies would eventually jump into this space and offer hybrid solutions. Depending upon your lending footprint, at the local jurisdiction level there are still a lot of variables in what they accept as legal and compliant from an eSign, eNotary and eRecording perspective and because of this many of the major players are hesitant to jump in. Again, this is a key differentiator for us as we make our documents “intelligent” to provide visual cues and automated compliance rules so we know down to document and county level which documents can be eSigned, eNotarized or need to be papered out and “wet” inked signed so the lender does not have to manage all of this.

The other key piece of the equation is that you cannot just automate the lender side of the transaction and ignore the title aspect. So we auto “e” enable those documents for automated eSign and eNotary to deliver a full paperless closing and better consumer experience for all parties involved.

eClose adoption is well on its way. Can you tell us a little bit about how eClosings are most effectively addresses with technology, and how it will help the industry advance digital mortgage adoption?

This also ties into the previous question of us having been out there longer than most to develop a more total, feature rich and robust solution than just a basic, simple eSigning tool. Delivering a system that does not include an automated way to “e” enable the documents is not a solution. Although we offer our system with or without embedded documents, in most installs where it was left to the lender to enable their documents, it never seemed to get off the ground. It’s one thing to enable a few static documents that incorporate a couple pages like the 1003 loan app, but it’s a totally different level of scale and complexity to attempt to do this with thousands of closings documents that must be dynamic and variable in nature.

Both Fannie Mae and Freddie Mac maintain a list of approved vendors that support eNote, eClosing and eVaulting, but for many on that list they are dependent upon other vendors to provide the key pieces needed to deliver a complete process and solution. That means that lenders have to separately vet out and sign multiple agreements to get and do what we do as a single provider. This introduces additional third party processes and risk into an already fairly complex process and service. At the end of the day, who is that one throat to choke that is going to stand behind and rep and warrant the process? People forget this is more than buying shoes online via Amazon. This is one of the most important legal transactions that a majority of consumers will make in their lifetime. I would go with a vendor that has a sole purpose of ensuring legal compliance.

Are there any pitfalls that lenders should look out for when selecting a vendor and implementing a digital mortgage process?

Yes. One key pitfall is what I mentioned above: Go with a vendor that can automate and support the entire process. Also, make sure they have been thoroughly vetted and approved by MERS, Fannie and Freddie and are currently on their vendors list. And finally, to ensure success, go with someone that actually has some experience and has been doing this for a while. Trust me, I’ve seen many initial failed “pilots” take place that have consumed a lot of time and resources, basically learning as they go along. This is not the best path or process you want to take.

There still seems to still be quite a bit confusion in the marketplace as to what actually comprises a digital mortgage. We’ve heard about hybrid solutions making some headway, but what about a completely paperless, comprehensive digital mortgage? Can you break it down for us?

Yes, and some of it is in terms of how we define a “Digital Mortgage” versus an “eMortgage.” We really don’t even talk about eMortgages anymore, as the industry coined the new term digital mortgages as if this is something totally new and different. When I talk about digital mortgages it’s more about providing additional automated data validation around systemically verifying the compliance of the data before you include it a document. eMortgages are really about making the process of generating, executing, storing and delivering the documents in a totally paperless and legal process. To ensure compliance, you need a solution that does both. That is the entire reason and need for an intelligent or SMART Document process. To fully break that critical component down, however, it would take another article to describe the importance of why.

But it is also a reason why many doc companies still can’t support a full eClosing process because their systems are based upon and can only produce dumb PDF documents as standard output. DocMagic’s docs, on the other hand, are native XML so we can embed the original source data to be electronically boarded and re-verified for any system to not only ensure the integrity of the document but the compliance of the data securely embedded within it. This is a revolutionary concept that many still do not understand today but if you look at where the Consumer Financial Protection Bureau (CFPB), Fannie Mae and Freddie Mac are going, all the new CFPB and GSE’s documents are moving to support MISMO 3.3 data format to verify the data before documents are drawn. But what good is verifying data if the originator cannot ensure the data that was last verified is in the documents they are purchasing? The only way to do that is to create an intelligent document and then eClose it to provide a tamper evident seal to ensure that.

That is why most doc systems can only support a “hybrid” eClosing because they cannot produce a SMARTDoc eNote or any other intelligent document that can be systematically verified and boarded. That is also why they do not have good solutions to auto tag eSignatures and eNotary just like the embedded data tags on those documents.  SMART Documents is what allows lenders to create more automated processes and auto boarding and verification of the data without having to OCR dumb PDF’s to extract the data to verify data after the fact. That is what intelligent processes and documents is all about and where the industry is moving.

This article originally appeared in the February 2018 edition of National Mortgage Professional Magazine.

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Written by Nathan Batts. This is the part 2 of a blog series. Click here to read part 1.

What is Driving the Transition

North Carolina is not the first state to begin offering electronic mortgages, but it is the first state in which the government has taken an active role in the development and rollout. The decision by the Secretary of State to begin a pilot project, convene various market participants together for a discussion, and form an advisory committee with the goal of developing best practices and standards now positions North Carolina to help form the national model for such transactions.

The groundwork began many years ago. The legal basis for digital signatures and documents has existed at the federal level, through such laws as the Electronic Signatures in Global and National Commerce Act (E-Sign Act), and at the state level in North Carolina, through such laws as the Uniform Electronic Transactions Act found in Article 40 of Chapter 66, since at least the year 2000. Similarly, North Carolina has had a structure for electronic recording and electronic notarization in place since 2005. The North Carolina structure includes safeguards such as a requirement that the electronic notary must be physically present with the borrower so as to protect against fraud or impersonation and duress.

In the years since then, advances in technology and encryption have made more secure transactions possible and have added the capability to detect when tampering is attempted to electronic signatures and documents. Changes affect the “hash value” which operates like a cryptographic and tamper evident seal.

From the standpoint of compliance with the Consumer Financial Protection Bureau’s TILA-RESPA integrated disclosure rule (TRID), an electronic mortgage also has many advantages. One of these is the ability to easily retain and store records and produce audit logs. Every digital signature is logged when made and the reports generated can become an important tool in showing good faith compliance.

As we look at the development across the state of capability to accept eRecording, additional counties are quickly coming online. In North Carolina, an estimated 77 out of 100 counties now accept secure eRecording, with 74 having full capability and three accepting mortgage satisfactions only. Electronic documents coming in are of higher legibility, and staff time and operating costs are reduced as scanning and other responsibilities are diminished. As more counties accept eRecording, travel to go out and do the filings in person and shipping costs can be reduced or eliminated, saving time, money, and reducing carbon emissions. 

From the closing attorney perspective, after an initial learning curve to use the software and modest investments in equipment like a webcam, electronic signature pads, and a computer, there is the prospect of potentially faster closings, as well as less travel to visit borrowers or down time waiting for borrowers and others to arrive for the closing. Mountains of paper are no longer needed. Much of the eClosing package can be completed in advance and the attorney has the certainty of knowing that all of the documents are on hand and are in the eClosing platform rather than dealing sometimes with the last-minute scramble to collect them from lenders. For an attorney, this could translate into a higher degree of efficiency and the capability to fit more closings in per day. And the closing attorney doesn’t have to lose time tracking down a borrower after closing because a document was left unsigned.

From a borrower perspective, the greater automation means that the time from application to underwriting and approval and closing can be significantly shortened. There is also the convenience factor of potentially eliminating travel, with the electronic notary coming to the borrower’s home or another location. And there is the real prospect of lowering closing costs as such things as mailing costs go away.

From a lender perspective, the essential documents are already in electronic form and are thereby ready much sooner for sales to investors, which can translate into more money per transaction as investors pay a premium for such speed. There is also the added advantage that there are no paper promissory notes to get lost.

Other Considerations

Lenders can choose what portions of the mortgage transaction should be electronic and which should continue to follow a traditional model. If a Register of Deeds in the lender’s market doesn’t accept eRecording for instance, the documents may need to be converted into paper for recording and notarized using the traditional method, but the efficiencies before that step are still realized. Similarly, a lender that wants to continue using paper documents may still want to scan documents and eRecord in some circumstances to save time. And there is nothing that prevents the closing from still taking place in person if that is the most comfortable for the parties.

For millennials and others who place a high value on convenience, electronic mortgages could be a good option. And for those who are buying a second home and don’t want to travel several hours to a closing, the prospect of having an electronic notary instead travel to them to help complete the transaction and to do the closing remotely may be a selling point. 

Future Transactions

While the NCBA is very optimistic about the market potential for electronic mortgages, we are still early from a market adoption standpoint. Federal regulators have been very supportive, particularly the CFPB which conducted a study and has actively encouraged financial institutions to explore the use of electronic mortgages.

Importantly, the servicing process and secondary market are still developing. Fannie Mae and Freddie Mac have taken steps to support the transition but others on the investor side are still building out their procedures. This means in the near term that the number of transactions will tick upward but the tipping point to when the flood begins is further down the road. 

As we go forward in this process, other eClosings have already been scheduled by the earliest adopters of this technology. The beginning of calendar year 2018 is emerging as a time period when some of the larger players in the mortgage industry appear positioned to begin phasing in the technology that underpins electronic mortgages. Once the conversion begins, the enhanced speed, efficiency, and cost savings will undoubtedly drive and accelerate the transformation. 

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Nathan Batts, Senior Vice President and Counsel, North Carolina Bankers Association (NCBA)