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Sat, 07/31/2010

By Tony Garritano

I can't go electronic because some mortgage documents still can't be e-signed. I hear this all the time from lenders. On the surface this argument seems reasonable but it really isn't. Why? This past weekend I entertained my niece and nephew. My two boys and my niece and nephew played a lot in our pool. Guess what? All four kids can’t really swim, but that didn't stop them from going in the water. My point is you need to start somewhere.

I think more lenders get this, which is why we’re seeing so much demand for e-disclosures. MDIA really made it impossible to process a loan cost effectively in a paper world. So, most lenders are getting their feet wet. What happens to those documents that need to be wet signed? I got a demo of a technology tool on Friday of last week that has a solution for that problem, too.

I demoed a tool called DocMagicXL. The tool more seamlessly integrates with the LOS to pull key data elements in without the need to rekey. The system includes a goof-proof feature that double checks everything and a high-cost test, as well. DocMagic said this approach makes the LOS truly the database of record and the doc prep is the outcome of the data in the LOS. Why should you care? This new product eliminates rekeying and further prepares you for the coming electronic world.

But here's the kicker in my view. I was going through the e-disclosure process and was told that the e-disclosure process will soon also deal with documents that need a wet signature, as well. DocMagic said, "It’s a race to get the borrower's signature these days." So, lenders want to include those documents that need a wet signature in the e-disclosure process. How will that work? If a document needs a wet signature it will prompt the user to print that document and when it's printed it will come with a barcoded cover sheet. So, the borrower continues the process electronically, e-signs what he can and prints everything else out, wet signs it and faxes it back.

The point of this article is not to promote DocMagic, but rather to demonstrate that there are technologies that can help lenders navigate a paper world and move them toward electronic processes all at the same time. Those are the technologies that I think lenders should be investing in today so they can both operate efficiently today and prepare for the electronic world of tomorrow.

Tony Garritano is chairman and founder at PROGRESS in Lending Association. As a speaker Tony has worked hard to inform executives about how technology should be a tool used to further business objectives. For over 10 years he has worked as a journalist, researcher and speaker in the mortgage technology space. Starting this association was the next step for someone like Tony, who has dedicated his career to providing mortgage executives with the information needed to make informed technology decisions. He can be reached via e-mail at tony@progressinlending.com.