Wednesday, December 2, 2015

E-Closings: Coming soon to a Lender near You?

I read with interest an article published in National Mortgage News just the other day titled, "What the GSE Plan to Collect TRID Documents Means for E-Closings." The article got me to thinking about the future of closings and how the technological revolution we live in every day will affect the future of the business I hold dear.

The thesis of the article, as written by Bonnie Sinnock, is: "A plan by the government-sponsored enterprises to begin electronically collecting the new Closing Disclosure data is designed to promote Fannie Mae and Freddie Mac's loan quality and risk management goals. But the initiative may also prompt broader use of electronic signatures and paperless processing in the mortgage industry."

Couple that with Quicken Loans’ announcement last week that it now officially offers a fully online mortgage through its new end-to-end online product, Rocket Mortgage, and it’s enough to make a mortgage industry veteran run for cover.

So much needs to shake out yet before we know what final form e-closings will take – and how deeply they will take root in our business – but without a doubt we are moving in that direction. What can we do now to prepare?

Above all else, make cybersecurity a top priority in your office. Study it, implement changes, bring in a consultant to help you get it right — do what you need to do but make it happen. Make no mistake, any company that has problems keeping information secure won’t be in business very long.

Earlier this year, Kelly Adkisson, a managing director at Accenture Credit Services, explained to HousingWire that: "Millennials are expecting different services and capabilities from lenders." Accenture’s research suggests the emergence of a new high value customer segment – "Generation D," people who are deeply digital, integrating online and social media into the fabric of their lives.

Because they have grown up online, they are comfortable living in that world day to day, but they also understand better than my generation the risks inherent online. They’re willing to transact business (including real estate closings) online, but their sensitive information must be kept secure.

What do you think?

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