Use Digital Mortgages to Better Member Experiences

It comes as no surprise that closing on a mortgage is still perceived as a stressful, cumbersome, expensive and lengthy process by many borrowers. Historically, this perception has been perpetuated by an abundance of documents requiring repeated information, lack of understanding of the language within those documents and errors at the closing table, among other stressors.

According to data recently published by the CFPB, borrowers reported that their biggest pain points during closing were too much paper, difficulty locating who to turn to for additional information and a general feeling of being overwhelmed by the process. As credit unions strive to provide an excellent experience for their members, how can those originating mortgages ensure that this process is as seamless and easy as possible for borrowers?

Increasingly, credit unions are offering more robust digital and mobile banking and payment solutions to their members. And given the competitive landscape led by tech-forward non-bank lenders, the transformation of the mortgage experience to the digital realm is gaining momentum for credit unions.

As credit unions increasingly focus on optimizing the front-end of the mortgage process by delivering a more digital-centric experience through point-of-sale platforms, they’re also increasing the focus on digitizing the back-end of the process to improve compliance; reduce operational inefficiencies, risks and costs; and ultimately deliver a streamlined and convenient experience to the borrower. Key to offering a true digital mortgage is to implement a seamless, end-to-end document process that incorporates eClosing technology, allowing for all documents to be signed electronically to provide a faster, more convenient and more informed closing experience to the borrower.

More Efficient

According to Ellie Mae’s most recent Origination Insights Report for March 2018, it takes borrowers on average 41 days to close on a home. While this is the shortest time to close the industry has seen yet, most borrowers continue to have to wait more than a month between filling out the initial application and receiving the keys to their new home.

While nearly all eClosings to date have been hybrid in nature – involving some paper documents and wet signatures – technology strives to further reduce the time and costs involved in closing loans as the evolution to digital continues.

When it comes to streamlining closing, integrated eClosing solutions can expedite the process in numerous ways. For example, through direct integration with the credit union’s loan origination system, lenders can automatically generate disclosures and other mortgage documents that adhere to specific loan criteria. Utilizing rules-based intelligence and calculations, every relevant data field can be imported, defaulted or automatically populated. Data-driven prompts ensure complete and accurate document packages for each transaction to prevent errors arising at the closing table.

As lenders focus on becoming as “e” as they can be, utilizing an eEligibility engine to analyze each closing package according to state, county and investor variations is key. Efficiency is directly correlated to process. Comprehensive eClosing solutions integrate all steps in the process, from document generation to eSign, eNote with MERS eRegistry, eNotarization, eRecording and eVault.

With comprehensive eClosing technology, lenders can ultimately streamline operational processes, compress the loan cycle and avoid compliance errors that may delay closing to speed up and improve the experience for their borrowers.

More Convenient

Fortunately for the many borrowers who reported large amounts of paper as one of the biggest hassles associated with closing, hybrid eClosings go a long way toward reducing the amount of physical paper needed to complete the transaction.

With eClosing technologies, borrowers no longer have to wade through stacks of physical documents, but can enjoy convenience and flexibility when it comes to reviewing and eSigning their mortgage documents. eClosing technology enables credit union lenders to electronically deliver closing documents so the borrower can access them anywhere, anytime and on any device to review and eSign prior to arriving at the closing table.

More Informed

eClosing technology further empowers borrowers in that it keeps them more informed about the process itself. The digital flow of information adds a layer of transparency to the transaction, as all aspects of the closing process are centralized in one platform to provide the lender with a comprehensive view of closing that they can then pass along to the borrower. Borrowers can essentially monitor the status of their loans in real time, allowing them to take more control of the process and proactively take any steps that are required of them.

With electronic documents, borrowers should no longer feel rushed to skim over document after document to review critical information regarding their loan at the closing table. Instead, they can review the documents at their leisure, taking the time they need to fully read and understand the language within their loan package. With time to review this information, borrowers can feel more empowered in the process and clarify any questions as needed before signing.

Adopting eMortgages allows credit union lenders to greatly transform members’ closing experiences for the better. With comprehensive eClosing technology on their sides, credit unions can ensure that closings are no longer an arduous process rife with stress and inefficiencies, but a chance to help their members enjoy a major achievement: Purchasing a home.

Shannon Barrow is Vice President of Marketing for Docutech. She can be reached at 208-535-9161 or sbarrow@docutech.com.