The Consumer Financial Protection Bureau (“CFPB”) recently published “Consumer complaints throughout the credit life cycle, by demographic characteristics,” an analysis that looks at various demographic and socio-economic characteristics of consumers that submitted complaints during the three-year time period of 2018 to 2020.

The CFPB states that through its analysis, which includes mapping complaints to a credit life cycle (loan origination, servicing of performing loans, delinquent servicing and credit reporting), it is possible to get a broader understanding of consumers’ financial experiences, rather than just looking at individual complaint submissions. The analysis looks at consumer non-public identifying information in relation to 2019 U.S. Census tract data from the American Community Survey. By looking at tract data, the analysis is able to provide community-level information about where consumer complaints are more prevalent and how that relates to demographic characteristics.

One of the key findings from the report is that lower income census tracts, and census tracts with a greater concentration of minority populations, are associated with greater rates of submitting credit reporting complaints and delinquent servicing complaints. In contrast, higher income census tracts were found to submit a greater share of complaints about loan origination and performing servicing than lower income census tracts.

The analysis also notes that since the CFPB was created in 2011, it has received more than 3 million consumer complaints, and that more than a quarter of those complaints were submitted after the beginning of the COVID-19 pandemic. Since March 2020, the largest increase in complaints has been in the category of loan origination, which correlates to an industry-wide increase in the number of refinance loans.

Related Content:

• CFPB report finds several mortgage-related violations in 2020 (7/20/2021)
• Fannie Mae and Freddie Mac announce changes to uniform instruments (8/11/2021)
• CFPB rescinds 7 pandemic-related policy statements (4/7/2021)

DocMagic has launched eSign 3.0, an upgrade to our eSignature platform, with new features designed to help lenders easily facilitate remote online notarization (RON) eClosings.

One of the new features is a secure eClose portal that enables notary and settlement service providers to access and update closing document packages. When the notary or closing agent adds documents, our AutoPrep tool automatically applies the essential e-tag information for electronic execution, eliminating the labor intensive and error-prone process of manually preparing documents.

In addition to new RON and eClosing capabilities, eSign 3.0 dramatically improves signer functionality. With a growing percentage of borrowers using their mobile devices to participate in the mortgage process, eSign 3.0 offers a much more intuitive mobile experience for borrowers.

“We developed eSign 3.0 by making the borrower experience our primary focus,” said Dominic Iannitti, president and CEO of DocMagic. “The workflow takes both the user's physical and emotional experiences into account. We paid close attention to the way users physically handle their phones as well as their emotional responses to technology. The result is a far more satisfying borrower experience.”

Additional eSign 3.0 upgrades include built-in knowledge-based authentication (KBA) and identity validation; a redesigned workflow to give borrowers additional time to read and review documents in a single, centralized view; an accelerated signing phase where intuitive tools track progress at every stage; and full oversight until all documents are executed. The platform’s integrated progress-tracking tools can be used on a computer or mobile device to keep borrowers aware of their progress every step of the way.

“It all starts with a robust API,” Iannitti said. “eSign 3.0 is powered by a comprehensive suite of web services designed specifically for seamless integrations. The end result is that eSign 3.0 makes borrowers feel more connected and informed, so they’re confident about working with their lender and walk away having enjoyed a more positive and memorable engagement.”

eSign 3.0 leverages DocMagic’s suite of eMortgage solutions, including its end-to-end Total eClose™ platform, dynamic document and MISMO Category 1 SMART Doc® eNote generation, automatic eNote registration with MERS®, and secure storage within its certified eVault.

Related Content:

• DocMagic named to 2021 Inc. 5000 list of fastest-growing companies (8/26/2021)
• 38 states allow remote notarization as RON, RIN and IPEN gain momentum (7/28/2021)
• Number of title agents who conducted eClosings rose in 2020 — but some still resist (4/22/2021)

SimpleNexus is integrating DocMagic’s eVault and eNote technologies with its Nexus Closing eMortgage solution, a move that will allow the company — which offers a homeownership platform that connects loan officers, borrowers, real estate agents and settlement agents — to generate eNotes, deliver them to a secure eVault, and register the eNotes with the MERS eRegistry.

“A fully digital closing, complete with eNote and eVault, is the last hurdle lenders must clear before offering borrowers and investors the myriad benefits of an eMortgage. We’re pleased to now offer these capabilities via our integration with DocMagic,” said SimpleNexus Chief Product Officer Shane Westra. “In a market cluttered with half-baked solutions, we’ve made it our mission to assemble the most comprehensive and singularly exceptional homebuying experience in the business.”

Case Study: Why one lender skipped eSign hybrids and went straight to eNotes 

In addition to DocMagic’s eVault technology, Nexus Closing comes with integrated remote online notarization (RON) and eSigning. It is certified to meet both Fannie Mae and Freddie Mac’s technical requirements for eClosing, eNote and eVault functionality and is compatible with their eNote delivery systems.

eNote registrations have grown dramatically over the past few years, rising from 17,000 in 2018 to more than 460,000 in 2020. eNotes are more secure and accurate than their paper counterparts and can be delivered instantaneously to the secondary market.

DocMagic’s certified eVault gives lenders the ability to access, manage and store eNotes and other electronic mortgage records on a short- or long-term basis. By offering proactive, real-time control of electronic loan files, eVault technology reduces cycle times and improves process efficiencies throughout the mortgage life cycle.

“To stay competitive in this market and future markets, lenders need to adopt eClosing solutions that allow them to generate, sign, store and deliver eNotes as part of a complete eMortgage transaction,” said Dominic Iannitti, DocMagic’s president and CEO. “We’re pleased to offer these capabilities to more lenders through our integration with SimpleNexus.”

Related Content:

• Ask the eClosing Team: Why are eNotes better than paper notes? (and other burning questions) (8/18/2021)
• 3 reasons why your post-closing department loves eClosings and eNotes (6/24/2021)
• Ask the eClosing Team: What do lenders need to get set up for eNotes? (3/4/2021)

With in-person events back in full swing, we’re excited to announce that DocMagic is hitting the road this fall and attending some of the mortgage industry’s biggest conferences! Check it out:

Sept. 27-28: HousingWire Annual (Frisco, Texas)

DocMagic will be a co-sponsor of the HousingWire Annual event. Several members of DocMagic’s eClosing Team, including Ron Carrillo, Michael Chaney and Leah Sommerville, will be in attendance.

We’ll also be presenting a live demo of our Total eClose solution, along with AutoPrep — our tool that can e-enable any document for paperless closings, even from third-party doc providers — on the main event stage in the Star Ballroom on Sept. 28 at 2:30 pm. Don’t miss it!

If you’re going to be at HousingWire Annual, come find our kiosk. Or better yet, set up a meeting by emailing Terry at tsmith@docmagic.com. 

Oct. 17-20: MBA Annual (San Diego, Calif.)

DocMagic will also be attending MBA Annual. Chris Lewis, our Director of Enterprise Solutions, will be there along with several members of our sales and implementation teams. You can read some of Chris’s analyses on the state of eClosing in the mortgage industry (here and here), previously published in MBA Newslink and The MORTGAGE BANKER magazine, respectively.

Come visit us at Booth 314. To set up a meeting with one of our eClosing experts at MBA Annual, email Terry at tsmith@docmagic.com. 

Dec. 14-16: National Mortgage News Digital (San Diego, Calif.)

In December we’ll be returning to San Diego for National Mortgage News Digital. Come visit our kiosk. We’ll also be presenting a live demo of our Total eClose solution, along with AutoPrep (our tool to e-enable any document for paperless closings, even from third-party doc providers). To schedule a meeting with a DocMagic representative at National Mortgage News Digital, just contact Terry!

Related Content:

• Did You Know: A basic hybrid eClosing is easier than you think? (9/15/2021)
• Ask the eClosing Team: Why are eNotes better than paper? (and other burning questions) (8/18/2021)
• 3 reasons why your post-closing department loves eClosings and eNotes (6/24/2021)

Before the pandemic, one of the major roadblocks to implementing eClosings was a lack of serious commitment. Companies talked the talk when it came to eMortgages, but in many instances the commitment was surface level at best. That all changed after COVID-19.

In 2020, with much of the country on lockdown or under stay-at-home orders — and with business threatening to grind to a halt — many mortgage companies finally decided it was time to seriously consider eClosings.

However, this decision to offer eClosings collides with the challenges of implementing them. The pandemic may have spurred lenders to consider eClosings, but many are unprepared for the reality of the road ahead of them. To get past this hurdle, lenders need to adopt the mindset that they will pursue electronic closings — whatever it takes.

Did You Know: A basic hybrid eClosing is easier than you think?

“No one can sit in a boardroom now and say they won’t do eClosings. They’d get fired,” said Brian D. Pannell, DocMagic's Chief eServices Executive. But much more common are the lenders who are enthusiastic when they start the process and then balk when they encounter difficulties. “There are people who come to the table and say, ‘I'm ready to do this,’ and then two weeks later say, ‘I didn't realize I had to do this much. I'm not ready to do this now.’”

Here’s a sampling of the obstacles that may sidetrack lenders who’ve made the decision to go “e”: They have to invest, sometimes heavily, in new systems; there is confusion over states’ varied eNotarization laws, including the temporary emergency orders; they may encounter resistance from secondary partners and investors; they want to offer eNotes but are confused about how to become a MERS eRegistry member, etc.

“When we talk to someone in the very beginning, we have to get them oriented toward the thought process that this has to be a commitment,” said Daniel McGrew, president and CEO of Elite Digital Advisors and the leader of DocMagic's eClosing team. He added that when he holds a best practices call with lenders who’ve decided to move forward, he informs them, “If your attitude today is, ‘we'll dip our toe in the water’ or ‘we'll just give this a try,’ you're setting yourself up for serious trouble. If the commitment's not there, this thing is going to fail.”

Additionally, this committed mindset needs to come from the top. “Regardless of who initiated the change, at the end of the day you must have executive sponsorship,” Pannell said. “Otherwise, organizations may reach the end of the implementation process only to find that even the pandemic couldn’t accelerate adoption and their company is only eClosing one or two loans a month. Then the executives will ask, ‘Why did we do this?’ Companies need a sustained strategy.”

The commitment needs to be there especially if the initial eClosings don’t go well. McGrew recalls one credit union that began implementing eClosings in 2020. Their very first eClosing, undertaken to great fanfare with high-level executives participating, ended up lasting almost two hours because the notary was completely new to the process.

That could have been a “one-and-done” situation, McGrew noted. However, the credit union was undeterred, learned some lessons from the mishap, and pressed on with electronic closes. By the end of 2020, the lender ended up closing almost 90 eNotes — with a lot more planned for 2021.

Pannell worked with a Midwestern bank that took an aggressive approach, insisting forcefully that all their stakeholders and partners get on board. “It was an uncomfortable change for a lot of people, but the bank made them do it,” Pannell said. The result? “They’re killing it right now.”

Another key reason why lenders must be prepared to push past any obstacles: Borrowers today are demanding some form of eClosing. In the past, they were content to follow the lender’s lead when it came to closings. However, amid the pandemic, borrowers have a new risk tolerance — and in many cases, that tolerance doesn’t allow for a traditional closing that involves a large stack of papers and a drawn-out, in-person signing. They want the safety of a quick or remote closing.

Additionally, borrowers have gotten used to the convenience of an Amazon-type experience, where they order something and it arrives almost immediately.

As a result, lenders need to have more flexibility when it comes to borrowers who want an eClosing on their terms. Since the pandemic, Pannell has gotten calls from lenders requesting help in the evenings, sometimes as late at 10 p.m. — while they were in the middle of conducting a RON closing. When asked why the ceremony was happening so late, lenders would answer, “This is the window the borrowers have.”

“So now lenders have to make themselves and their support staff more available. It’s no longer a world of 8 a.m. to 6 p.m. office hours,” Pannell said. “Lenders are at the beck and call of the borrower now. You’re going to work some unique scenarios, and you have to be committed to that. You have to know that this is the new norm.”

To learn about four other key hurdles to eClosing implementation — and how to overcome them — download the full white paper here.

Related Content:

• Ask the eClosing Team: Why are eNotes better than paper? (and other burning questions) (8/18/2021)
• Did You Know: You can get all your eClosing needs met by one vendor? (6/16/2021)
• Ask the eClosing Team: What steps should lenders take to get set up for eClosing? (6/2/2021)

For many lenders used to a paper-based mortgage process, an electronic closing may feel out of reach. Why? “The county recorder won’t accept it.” “My investors won’t purchase it.” “I can’t change my processes.”

And of course, “It’s too difficult to implement.”

Except it isn’t.

While eNotes and eNotarization do require more time and effort, a basic eSign hybrid — in which borrowers can electronically sign all of the closing documents, with the exception of the note and recordable documents — is very simple to set up. Lenders who are already using DocMagic’s doc gen solution, in fact, can be enabled for eSign hybrids (also known as Hybrid #1) in as little as 24 hours. 

“As soon as you say ‘eClose,’ a lot of clients say, ‘We can't do that. We can't do an eNote. We can't do eNotary,’” said Aimee Eyre, a sales executive at DocMagic. “But eSign hybrids don’t require a big implementation.”

This type of hybrid closing allows borrowers to preview all of their documents ahead of the closing; switches the majority of documents from paper to digital; and reduces a prolonged, drawn-out ceremony to a matter of minutes. Crucially, it’s also accepted by every investor and county recorder in the country. The more complicated pieces of the closing, the note and deed, are still wet-ink signed and can undergo traditional in-person notarization.

During the pandemic, eSign hybrids shot up in popularity as many lenders set up a drive-thru closing system to allow for shorter and mostly socially distanced closings from the safety of a car.

For DocMagic’s doc gen customers, adding on eSign hybrid capability is easy; it can be set up within 24 hours and clients can begin testing it out with their teams and settlement agents. “It’s just a matter of a couple of clicks,” said Darlyn Buthsombat, a DocMagic account executive. “We’ve already done the work on the backend; we already know which forms are e-enabled and what type of eClosing it is.”

Additionally, lenders have plenty of flexibility with such hybrids, which can be implemented for specific investors, states or loan programs.

For a new customer, the onboarding time frame is closer to 30 to 90 days, depending on the size of the company and if they have special requests, as new lenders first need to be set up for processing documents.

For most lenders, there’s one main roadblock to implementing an eSign hybrid: “It’s an operational change. When I speak with a customer, that's their only resistance — it's just a big change to how they do things,” Buthsombat said.

“But there shouldn't be anything that's stopping lenders from doing this type of hybrid because it's really easy,” she continued. “It's a win-win situation for all parties: the lender, the selling agent and the borrower.”

DocMagic’s Sales Team can be reached at sales@docmagic.com.

Related Content:

• Did You Know: You can cut out the middleman and draw your own docs? (6/30/2021)
• Did You Know: You can get all your eClosing needs met by one vendor? (6/16/2021)
• Ask the eClosing Team: What steps should lenders take to get set up for eClosing? (6/2/2021)