NMP - February 2018 - 68

a special focus on THE PURSUIT OF PAPERLESS a special focus on THE PURSUIT OF PA

The Mortgage Industry's
Move to Paperless By Peter Pescatore
cross many
aspects of
today's life, the
push to
paperless is
evident and
largely unavoidable, and the
mortgage industry is no
exception. The process of
filling out applications and
signing contracts not only
causes a ruthless wastage of
paper, but also is a challenging
ordeal for both the applicants
who need to undergo tedious
cycles of documentation and
for the lenders who need to
maintain duly updated records
of their customers in the form
of heaps of files in their offices.
As such, eliminating the use of
paper can be a true blessing
for the mortgage industry.
Going paperless will not only
simplify and quicken the
related processes, but also

A

help in conserving the
environment on the whole.
Paperless mortgage:
The statistics
With the advent of advanced
digital technologies, there has
been a phenomenal shift from
traditional processes to all
things digital. We have seen
how digitalization has
simplified a variety of our
everyday tasks and now is the
time to witness the
transformations in the way we
get our mortgages as well.
While the technology might be
relatively new for the industry,
there are several lending
institutions that have already
digitalized their operations and
adopted paperless loan
processing for convenient and
fast processing and disbursal
of loans. And that's not all!
Going digital has also helped

FEBRUARY 2018 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

68

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countless lending institutions
to enhance their mobility and
accessibility and boost their
revenues in an exceedingly
competitive market.
Back in 2016, the leading
document technology provider
Xerox had carried out a survey
called the "Xerox Path to
Paperless Survey" in which it
was found out that both the
lenders, as well as borrowers,
were more than willing to
embrace the complete
digitalization of the mortgage
industry. The survey also
established that in the wake of
the major regulatory changes
namely the TRID rule or the
TILA-RESPA Integrated
Disclosure Rule, approximately
92 percent of the experts in the
mortgage industry anticipated
a rise in the automation of the
loan processing in the country.
According to the survey, while
66 percent of individuals stated
that the digitalization will help
in speeding up the closing
disclosure process, a total of
63 percent believed that it
would be of great help in
making the document delivery
process quicker and more
simplified. In addition, nearly
59 percent of the individuals
pointed out that by going
paperless, the mortgage
industry will be able to achieve
not only lower cost-per-loan,
but also reduced processing
times.
eMortgages
In a bid to go paperless, the
mortgage industry has
switched to the digitalization
format of loan processing
called eMortgage. In essence,
an eMortgage may be defined
as an electronic mortgage
wherein the entire
documentation associated with
the loan processing including
its creation, execution, transfer
and storage is carried out
electronically. The eMortgage
may be rightly deemed as a
quicker and more simplified
version of the traditional
mortgage processes.
The United States of
America has certain
legislations including the
Uniform Electronics

Transactions Act and the
Electronic Signatures in Global
and National Commerce Act
that makes eMortgage legally
enforceable within the country.
In addition to this, the U.S.
government is also geared
towards standardizing the
eMortgage with the help of the
MISMO or the Mortgage
Industry Standards
Maintenance organization. The
MISMO workgroup closely
associated with the
standardization of the
eMortgage is currently involved
with updating the MISMO data
and integrating electronic
signature capabilities and other
data elements in a bid to
create an entirely paperless
infrastructure. The
aforementioned infrastructure
for the eMortgage has been
formulated on the lines of the
SMART DOC and the SMART
Document implementation
guide.
Paperless transactions
Paperless mortgages indeed
have the potential of becoming
a revolutionary game-changer
in the industry. As such, the
one most important component
of digital or paperless
mortgages is the technology
called eSignature that allows
the signatory to put his
signatures on the document
electronically without actually
using a pen and paper. If the
e-signature conforms to the
guidelines stipulated under the
National Institute of Standards
and Technology-Digital
Signature Standard (NIST-DSS)
of the United States, it holds
the same legal relevance as an
actual handwritten signature.
Given the highly confidential
nature of a signature, the esignatures used in the
paperless mortgage
transactions incorporate a
cryptographic mechanism that
keeps them safe and secure
against unauthorized access or
usage.
What are the benefits of
paperless mortgage?
While still in a comparatively
nascent stage, the concept of
paperless mortgage has
significant upsides that have
already been duly established.
Here are a few of them ...
l Saves time: One of the
most obvious and


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Table of Contents for the Digital Edition of NMP - February 2018

Contents
NMP - February 2018 - Cover1
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NMP - February 2018 - 1
NMP - February 2018 - Contents
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