The e-closing hype: Is it full of sound and fury, signifying nothing………..or something?
The ‘talk’ in the industry about e-closings often reminds me of a famous line from Shakespeare’s Macbeth: ‘full of sound and fury, signifying nothing!’ Progress toward the ‘holy grail’ goal of fully remote electronic closings seems to be measured in baby steps, and understandable given limitations at the state and recording office level. However, a giant leap forward is achievable when lenders embrace what they can achieve today and not wait or wish for what they cannot yet achieve.
Such was the main point of a presentation I made at the Digital Mortgage conference a few weeks ago to over 1,000 attendees. While there, we launched a tool designed to help lenders find out what type of e-closing method they could choose at a zip code level (known as Hybrid, Full Electronic, and Remote) and revealed some surprising facts based on our tool: that there are 441 counties in which a fully electronic closing is achievable, whereas there are only 27 in which a fully remote electronic closing (the holy grail) was achievable. Our point was that all the talk seems to be focused on something that is not yet available in 99% of the counties, but residing within the 441 counties (or 11.6 % of all counties) were 6,000,000 people, meaning a sizeable market exists for a lender to pursue an e-closing strategy.
At least one of our customers was listening: Digital Federal Credit Union! This past week, after using eWays to identify counties in which they could execute a fully electronic closing, their loan staff matched applicants in those counties and closed not just one but two through us in the same week, all in Florida!
Earlier this year, Digital’s management established a goal of at least one fully electronic closing by the end of the year, and turned to us to help them find a way. After giving them access to eWays, they were able to quickly zero in on members in their pipeline in eligible counties and offer them a fully electronic closing. Their member-borrowers were delighted as they all were employed in highly technical occupations.
We also learned that Digital, like most lenders, had been listening all year to the ‘talk’ and noise and becoming anxious that they were behind the ‘e-curve’ and had to catch up, resulting in setting their goal in late September of at least one fully electronic closing by the end of the year. Talking with us and working with our eWays tool, they learned their goal was very achievable, and now, having a few under their belts, their appetite for more has been whetted.
The mortgage industry is filled with niche products serving slices of the population, and no lender waits for such products to be available to all consumers before offering them to niche borrowers. So why wait for e-closings to be achievable in the remaining 88% of the counties before making an offer to the 12%?
Lenders embracing what they can achieve today instead of waiting for more adoption can make their own ‘sound and fury’ and gain rich experience and insight in so doing – and quite likely more market share. Enterprising lenders will be stimulated to find appealing ways to access those borrowers, which really signifies ‘something.’
And we stand ready to show them the path!
If you are a lender ready to embrace what is achievable today, send me an email to set up a time to meet. firstname.lastname@example.org
Readers can access a free demo of eWays by signing up via: www.eclosingsbyequity.com
By: Equity National Title October 31, 2017 Uncategorized