Free eBook: The Title Agent's Guide to Remote Online Notarization
This post is an excerpt from The Title Agent's Guide to Remote Online Notarization. Access the complete guide here.
Do you remember the story about the boy who cried wolf? For those who need a refresher: It’s a fable about a shepherd boy who repeatedly tricked nearby villagers into thinking a wolf was attacking the town’s flock. The boy told the lie so often that when a wolf actually attacked the sheep, no one believed him.
Real estate has its very own version of “The Boy Who Cried Wolf.” If you’ve been in the industry long enough, you’ve been told for 20-plus years that the mortgage process would soon live entirely online. You were told the digital revolution was weeks away; months away; one regulation or big-time lender away. You perhaps bought the hype early, held out for results that never came, and have been in wait-and-see mode since.
But we mean it this time – closings are moving online, and we have numbers to prove it.
The most telling sign is the growing popularity of electronic promissory notes, or eNotes. An eNote contains all of the same information within a traditional paper note – property address, title agent address, loan amount, percentages, etc. – but is created, signed, and managed digitally. eNotes are a critical component of a fully digital mortgage.
The number of eNotes added to the MERS® eRegistry during the first quarter of 2019 (19,000) exceeded the number of eNotes registered in all of 2018 (17,000). Four of the Top 10 warehouse lenders from Q4 2018 now fund eNotes, and the number of outstanding active eNotes increased to 109,000 – roughly $28 billion in residential mortgages.
According to MERS®, “Rapid growth of eNotes is a key indicator that the residential lending industry continues to drive toward greater digitization of the production process.”
Title agents are well positioned to become educators and thought leaders as online closings grow in popularity. Aiding lenders on the path to fully digital closings will allow title companies to strengthen existing business relationships and grow into the future.
The obstacles that have long blocked digital mortgage adoption are melting away. That leaves title agencies with two options: to learn about RON and the online closing process ahead of your competition or to learn as your lenders learn.
In one survey, 65% of real estate professionals said that they expect to adopt RON and secure collaboration and communication portals by the end of 2019. “Streamlining time-consuming processes, as well as delivering an improved consumer experience, is top of mind for real estate professionals,” wrote Mark Fleming, chief economist at First American, in the November 2018 Real Estate Sentiment Index. “Fintech is here to stay.”
"The Title Agent's Guide to Remote Online Notarization" will explain RON and its impact on the title industry, its use cases, why it’s more secure and accessible than the traditional notarial processes, and how it’s forever trans- forming the largest sectors of the American economy.