Redfin Closes “Instant” Mortgage with Notarize
Notarize celebrated its 1,000th online mortgage transaction at the start of 2019, just 18 months after completing the first online closing in the country. We’re thrilled about the momentum we’re seeing in the market, including key partnerships with some of the leader in the mortgage industry.
This includes our friends at Redfin, whose agents recently sourced and funded a loan in less than two hours, performing one of the fastest online closings in the industry.
Having just had their first child, new parents in Virginia were navigating the home buying process for the first time. The borrowers voiced concern to their mortgage advisor about traveling in the middle of winter with a baby. It’s an understandable concern. Showing up at the closing table involves taking time off work, finding a babysitter, paying for a babysitter, driving to the lender’s office, spending a few hours signing paperwork, driving to pick up their newborn and then returning home.
eClosings Gives Borrowers Unprecedented Convenience
To solve for the buyer’s need, this Redfin mortgage advisor presented the eClosing option to the borrowers. This made it possible for the couple to close on their loan without traveling at all. Here’s a timeline of how this quick transaction happened:
3:40 PM Online closing meeting started with borrowers via webcam
4:23 PM Online closing meeting ended
4:30 PM Loan funded
5:07 PM Loan transferred to warehouse lender
5:15 PM Loan delivered to non-GSE investor
5:16 PM Couple celebrates the purchase of their new home!
Not only do eClosings save time for the borrower, it saves even more time for Sean Malone, Redfin’s Post Closing Manager. Traditionally after a closing meeting, he has to prepare the promissory note for an electronic delivery of the package to the investor. The note is then transported to a warehouse lender to be secured before the rights of the loan are transferred to the new investor. Sean also must figure out shipping logistics of some physical packages. These processes generally takes a week or more to complete, on average.
eClosings Saves Lenders Time and Money
But with an eClosing, Sean received the completed digital package seconds after the borrowers finished eSigning. He transferred rights to the investor instantly and delivered the package to the investor and within an hour of closing.
Why is shrinking the processing time down to one day such a big deal? As soon as the borrower signs on the loan, the lender immediately starts accruing interest charges. Redfin must pay interest while the paperwork is waiting to be completed. By making this process digital, it reduces processing time of paperwork. The lender saves both time and money.
“We went from close to investor purchase within five days,” Sean said. “The industry average is twenty days. That’s unheard of in this industry.”
eClosings also help offset increased mortgage production costs, saving lenders time and money. This allows Redfin to slash interest rates and put money back in the hands of their borrowers. For this particular loan, the interest rate was .8% lower than average.
Redfin’s partnership with Notarize allows their mortgage advisors to focus on what they do best: closing deals.