As electronic signing adoption continues to evolve, so have the technologies that lenders can use to embrace this time- and money-saving strategy. For example, eSignSystems, a division of DocMagic, has launched its new SmartSAFE XL platform that marries sophisticated functionality with elegant simplicity, resulting in a highly intuitive e-signature process. Here’s the scoop:

Benefits of the new application include greater scalability, increased transaction volume, and a simplified user interface, resulting in a very smooth and intuitive process.

SmartSAFE XL is a complete modernization of prior versions of the SmartSAFE interface and infrastructure. The new codebase has been redesigned using Microsoft technologies such as ASP.NET MVC 5.0 and Entity Framework 6 as well as HTML 5. The search fields are smarter, and modifications to participants and annotations can be done on-the-fly.

“Users of SmartSAFE XL will experience a clean and intuitive user experience in the management of documents and SigningRooms, increased workflow efficiencies, and streamlined administration of the system, making SmartSAFE XL one of the most robust and powerful eSignature and eVaulting solutions on the market,” said Kelly Purcell, EVP of sales and marketing at eSignSystems. “The new platform is ideal for companies that require more flexibility, extendibility and control over their eSign processes.”

SmartSAFE XL provides a centralized, user-friendly interface to prepare documents and establish “SigningRooms” for anything a user may want to electronically have signed, from loan documents to functional areas such as sales departments to contracts and NDAs, human resource departments for employee paperwork and benefits, in-house legal departments, partner networks, and more.

The platform is completely secure and provides legally-binding audit trails that are automatically initiated, collected and retained for the lifetime of the electronic record.

SmartSAFE XL is fully compliant with the Uniform Electronic Transaction Act (UETA), Revised Article 9 of the UCC, ESIGN, The Electronic Signatures in Global and National Commerce Act, ESIGN, and Federal ESIGN eSignature and eRecord retention laws as well as international governance bodies such as the EU Electronic Signatures Directive.

“eSignSystems has been very successful in helping companies of all types leverage electronic signatures within their operational workflows,” said Dominic Iannitti, president and CEO of DocMagic, Inc., which acquired eSignSystems last year. “The launch of SmartSAFE XL takes eSigning to the next level for organizations that have specific needs for more customizable eSigning solutions.”

As featured by Progress In Lending, April 2015

By Phil Hall

On the company Web site, DocMagic bills itself as “The largest loan document production company in the U.S.” And while that is a grand definition, it doesn’t capture the intelligence, innovation and celebrated customer service level that has earned the company the respect of the industry.

National Mortgage Professional Magazine spoke with Don Iannitti, the company’s founder, president and chief executive officer, to discuss how DocMagic emerged to become a leader in its field.

What was the inspiration behind starting DocMagic?
Don Iannitti: When I was in college back in 1987, I was reading a book that focused on emerging technologies. There was one chapter that focused on the “repackaging of data.” After I read about it, I wasn’t sure of applications relating to that—I wondered who in the world would want to buy repackaged data.

At the time, I had a part-time job that did speed typing of other types of documents. I then realized that we were doing what was in the book. So, I brainstormed and came up with a concept related to this. Also at this time, I found someone who was looking to get into a different type of business—a mortgage banker looking to customize appraisals. I floated my idea on how he could automate that concept.

Customized appraisals? Did that business take off?
No, and I am happy that it did not happen.

So what happened next?
I went to work on another business plan. I micro-analyzed every number, every night, and put threeto four months into it. That mortgage banker was Patrick Theodora of American City Mortgage. He and his father, Pasquale Theodora, decided to
fund me.

How close did your business plan coincide with the actual business?
In our first year of business, our bottom line was within $6,000. In our second year of business, our bottom line was within $10,000. So, it was close to what I planned.

When the company began operations in 1988, what was the state of loan document production?
It was all over the map. A lot of typing was going on, and lenders had between 25 and 50 percent of the burden of doing those tasks themselves. You had typewriters, and the best ones were just adding computer interfaces to those machines. Word processing was not very common at that time. When we opened our doors, a company came by and gave us a word processor to see if we liked it. But there were no laser printers yet, just dot matrix printers at that stage. Oh, the dot matrix printers–they sounded like machine gun fire! But this was before the Internet, yes? There was no Internet, no modems. It was an interesting time.

So what were the important milestones in growing your company?
First was the introduction of the laser printer. Before that, we had between 5,000 and 7,000 documents that were photocopied. And every time we needed a new batch, we had to walk over to the photocopier and make another 500 to 700.

Next was the introduction of the modem. That was critical. The first use of the modem was in calling and talking to a remote laser printer, in order to make it print across the phone line. Needless to say, that was not the most efficient use of technology.

Our first version of DocMagic had a computer talking to a computer. When that happened, all of the issues involving a laser printer going offline or running out of paper went away.

Increasing the speed in modems was also helpful. But when the Internet came along, our racks of modems were replaced. Also, increasing the speed of the computers was important. In our beginning stages, we’d make the computers. When we first got into the markets, companies had to use mini-frame or mainframes. We had PCs, but with each new machine running at faster speed, we’d always be at the point of being maxed out. We were always riding the tech wave–as soon as any computer came out that made work faster, we were on it.

What have been DocMagic’s greatest challenges, and how did the company face these challenges?
Our greatest challenge was in maintaining employees. This was crucial because when clients call us, we didn’t want to have them deal with an employee turnover. One thing we did was to make sure that our employees knew how important they were, and to make sure they feel like they are part of the family. We have employee events and company picnics. Now we’re at over 100 people, and many people have been with our company for 25 years.

What do you look for when recruiting new people to be part of your team?
We are looking for a certain spark and a certain sense of humor. We prefer an extroverted applicant, someone who can carry on a conversation. We ask applicants a lot of questions and drill into their past jobs, asking about their work experience. We are looking at their history of job longevity–someone who had jobs for one or two years will never work. We want to make sure that we have the right people. This job involves a lot of compliance issues, and we want to make sure that anyone we hire is well-educated.

That leads to the next question … how have the regulatory changes of the past several years impacted the manner in which DocMagic operates?
This is a big part of what we do. The regulatory changes directly impacted the growth of our automated auditing engine. And sometimes, regulatory changes do not directly impact new documents. Oftentimes, it involves timing changes or different types of notifications. Our compliance audit engine makes our clients aware of something that they may potentially face.

With regulations, there is always something happening. We have a team that monitors changes on a state level–there is never a dull moment. Compliance is a living, breathing thing—it never gets easier, and it always becomes exponentially more complex.

The changes that we are seeing now dwarf what we’ve seen in the past. But this is where we shine, and that brings value to our clients because that is something they do not have to worry about.

How has DocMagic approached cybersecurity?
We’re constantly monitoring that sort of thing. We have lots of new insurance policies that we need to maintain. And this despite the fact that we are somewhat under the radar; we’re not like Amazon or Google, where people want to attack us all of the time.

We have a number of services whose job is to try to hack into us and find our vulnerabilities. It is an amazing process to see what they’ve found, and it requires us to plug or solve whatever vulnerabilities exist.

We also deal with the nation’s top five lenders, and they have their own requirements on vendor cybersecurity as well.

What does the future hold for DocMagic?
A lot of our efforts are focused on esigning and e-closing. We are in two pilot tests on that with the Consumer Financial Protection Bureau.

We are also expanding our esigning product into other industries. Right now, we are working with the insurance industry.

As for the company, we are definitely expanding. We have a vision of where we would like to be in the next decade. We are also keeping open lines of communications with our closest competitors—should they want to leave the market, we can look at their operations.

As featured by National Mortgage Professional, April 2015

Redesigned platform offers newfound eSigning, eDelivery, eVaulting capabilities

TUCSON, Ariz., March 30, 2015—eSignSystems, a division of DocMagic, Inc., announced at the Mortgage Banking Technology Conference in Orlando, Florida the introduction of its new SmartSAFE XL™ platform that marries sophisticated functionality with elegant simplicity, resulting in an expedited and highly intuitive eSignature process.
Benefits of the new application include greater scalability, increased enterprise volume transaction capabilities, enhanced flexibility and a simplified user interface, the combination of which results in a very smooth and intuitive process.

SmartSAFE XL is a complete modernization of prior versions of the SmartSAFE interface and infrastructure. The new codebase has been redesigned using Microsoft technologies such as ASP.NET MVC 5.0 and Entity Framework 6 as well as HTML 5. The search fields are smarter, and modifications to participants and annotations can be done on-the-fly.

“Users of SmartSAFE XL will experience a clean and intuitive user experience in the management of documents and SigningRooms, increased workflow efficiencies, and streamlined administration of the system, making SmartSAFE XL one of the most robust and powerful eSignature and Vaulting solutions on the market, said Kelly Purcell, EVP of sales and marketing at eSignSystems,” said Kelly Purcell, EVP of sales and marketing at eSignSystems. “The new platform is ideal for companies that require more flexibility, extendibility and control over eSigning processes.”

SmartSAFE XL provides a centralized, user friendly interface to prepare documents and establish “eSigningRooms” for anything a user may want to electronically have signed, from loan documents to functional areas such as sales departments to eSign contracts and NDAs, human resource departments for employee paperwork and benefits, in-house legal departments, partner networks, and more.

The platform is completely secure and provides legally-binding audit trails that are automatically initiated, collected and retained for the lifetime of the electronic record.

SmartSAFE XL is fully compliant with the Uniform Electronic Transaction Act (UETA), Revised Article 9 of the UCC, ESIGN, The Electronic Signatures in Global and National Commerce Act, ESIGN, and Federal ESIGN eSignature and eRecord retention laws as well as international governance bodies such as the EU Electronic Signatures Directive.

“eSignSystems has been very successful in helping companies of all types leverage electronic signatures within their operational workflows,” said Dominic Iannitti, president and CEO of DocMagic, Inc., which acquired eSignSystems last year. “The launch of SmartSAFE XL takes eSigning to the next level for
enterprise-level organizations that have specific needs for more customizable eSigning solutions.”

eSignSystems was purchased by DocMagic, Inc. in late 2014 and now resides under its enterprise-class infrastructure and business model, with access to its extensive resources to innovate and scale.

Interested parties can contact eSignSystems to learn more about how SmartSAFE XL can address their specific business needs at 602-840-1199 or sales@esignsystems.com.

About eSignSystems
eSignSystems, a division of DocMagic, Inc., is a leading provider of lifecycle management of electronically signed, legally binding documents, contracts and digital transactions. SmartSAFE XL™
enables companies to manage business processes and transactions entirely online. Organizations can adhere better to certain regulatory compliance issues, improve productivity and efficiency in processing transactions, and achieve significant cost savings through the elimination of document transportation costs, processing and storage. For more information, visit www.esignsystems.com.

About DocMagic
DocMagic, Inc. is a leading provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions for the mortgage industry. Founded in 1988 and headquartered in Torrance, Calif., DocMagic, Inc. develops software, mobile apps, processes and web-based systems for the production and delivery of compliant loan document packages. The company’s compliance experts and in-house legal staff constantly monitor legal and regulatory changes at the state, federal and international levels to ensure accuracy. For more information on DocMagic, visit www.docmagic.com.

Sarah Wheeler

As the clock counts down to TILA-RESPA implementation, title, closing and settlement services step into the line of fire

There was a time when companies that dealt with title, closing and settlement services were important, but somewhat invisible, players in the mortgage process. All that changed with the increased regulation under Dodd-Frank. Now, lenders are on the dime for the actions of their third-party vendors, and the delivery timing of the new Loan Estimate and Closing Disclosure mandated by TILA-RESPA means that title, closing and settlement services companies are critical to a compliant origination process.

The Consumer Financial Protection Bureau lit the fuse on the TILA-RESPA time bomb back in 2013, when it issued the Final Integrated Disclosure rule, after fielding industry comments for several years. But with an implementation deadline of Aug. 1, 2015, and other Dodd-Frank rules to deal with in the meantime, the fuse hissed along quietly until last summer.

That’s when the reality of having only 12 months left to make profound process changes started to sink in, and parts of the industry went into overdrive to adapt. But by January 2015, some lenders were still waiting for software from third-party vendors.

An article on respalawyer.com from Jan. 12, 2015, expressed the unease that many were feeling. “The TILA-RESPA Integrated Disclosure Rule’s implementation date is beginning to cause heightened concern and worry for those involved in the residential lending industry,” the article stated.
“One reason is the emerging news that a number of the third-party vendors engaged to write the loan originator system ‘LOS’ software may not be able to do so until April, May, June, or even worse, that some of the LOS systems that are rolled out may not be in compliance when the residential lender implements the LOS into their system.”

The basic intent of the rule seems innocuous enough — combining forms and increasing transparency to make it easier for the consumer. But with so many moving parts, changing the mortgage process is always more complicated than it first appears.

Some of TILA-RESPA’s biggest changes concern the delivery of information to consumers. On the front end, lenders have to deliver a Loan Estimate to consumers within three business days of their mortgage loan application. As the loan proceeds, consumers must get the Closing Disclosure three business days before closing. Simple, right? Not really.

Tim Anderson, director of eServices at DocMagic, echoed that concern. “Delivering a disclosure form is just the tip of the iceberg — it’s not the solution. Compliance happens all around the process; compliance is looking at and validating data all the way to closing. If you only map and worry about a single form, if you architect something to address a single issue, you miss the point that it’s an overall process that has to be changed.”

John Hollenbeck, executive vice president for First American Title Insurance Company, said that his company started preparing for the regulatory change as soon as the proposed rules were published, and he now feels confident they will be ready — two years later.

“We’ve dedicated resourced from every level of the company,” Hollenbeck said. “The greatest challenge was developing an understanding and appreciation for the depth of the process changes that need to take place to implement the new TILA-RESPA Integrated Disclosures (TRID). It’s a true inflection point for our industry and requires a re-engineering of workflows for lenders and settlement service providers.”

Joe Mowery, president of LenderLive’s Settlement Services division, says the three-day delivery window is the greatest obstacle.

“TRID requires the lender to ensure the consumer receives the CD no later than three business days before loan consummation. Due to these timeline requirements, the industry seems to be preparing itself to send the CD to borrowers seven days in advance of the consummation,” Mowery said. “Additionally, if there is an ? of a percent change (for most loans) in APR, a change in loan product, or the addition of a prepayment penalty, any of these changes require the lender to provide a new CD and an additional three-business-day waiting period for the borrower. Imagine the delays that are forthcoming.”

And the stakes are high for everyone. Lenders could face civil penalties as high as $1 million per day if they delay disclosures “knowingly.” Even unintentional TILA-RESPA violations could cost lenders up to $5,000 a day.

“The onus for creating accurate closing disclosures falls 100% on the lender, with substantial penalties for mismanagement,” said Brian Benson, CEO of ClosingCorp.

With that kind of risk, the relationship between lenders and their vendor partners is undergoing a transformation. Both sides have to increase the transparency and communication of their actions.

“That is changing the way lenders are electing to interact with their provider networks, and there is a lot of work they must do to implement and manage that change,” Benson said. “The new rules will undoubtedly have an impact in vendor selection, lenders’ migration away from ABAs, their concern for fee standardization, and their general tolerance for complexity.”

Anderson agreed. “The new Combined Disclosure regulation is going to force lenders to connect to title agents at the time of application and prior to closing to ensure compliance,” he wrote in a HousingWire Closing Call blog. “With the faster and more accurate delivery requirement of the charges between the Loan Estimate and Closing Disclosure forms, constant and reliable communication will be key between lenders and title agents.”

Vendor consolidation?

With more risk around third-party providers, and more cost to mitigate that risk, many lenders are choosing partners who have the will and resources to change their process. And that means that the new regulations are likely to speed up the vendor consolidation process that was already happening across the industry.

“Many banks and mortgage bankers to whom we have spoken will only be utilizing one title vendor because they are concerned about the integration timeline and do not want to be left shut down in whole or in part on or after Aug. 1, 2015, as a result of spreading their compliance across too many vendors,” the respa lawyer blog reported on Jan. 12.

As always with new regulations, smaller companies are the least likely to have the resources to adapt in time, and are affected disproportionately.

“Title agencies hoping to gain business from large lending institutions will have to make investments in technology, security, quality control, procedure documentation and employee training,” HDEP International wrote in an article on the effect of the Dodd-Frank regulations.

“The initial investments alone will be high, and the ongoing maintenance expense to remain in compliance could significantly change the cost structure of all title companies. Many agents in smaller counties will be unable to afford these expenses without increasing their premiums.”

The report also said, “In addition to across-the-board premium increases, we expect that small agencies will consolidate into larger regional agencies, so the additional expenses mandated by lenders can be spread over a larger revenue base… Finally, some of the larger lenders will begin to evaluate acquiring title underwriters and larger regional agents...”

But even big lenders are facing a challenge. Wells Fargo worked with more than 17,000 title and settlement services companies in 2013, according to The   Wall Street Journal. Ensuring even one change in the process with that many disparate elements is a monumental task.

Consumers get a mixed bag

The rules were designed to give consumers more timely and accurate information about their mortgage loan, but no good deed goes unpunished, and consumers will have to bear some of the burden as well. Closing times, for instance are going to get longer.

“Real estate agents must explain to their clients the timing requirements so that there are no unrealistic expectations,” Cynthia Blair, of Blair Cato Pickren Casterline said in a post on the American Land Title Association’s website in February. “Ultimately, it’s important to give the closing process enough time to happen. Fifteen- to 20-day closings are probably a thing of the past.”

Ken Trepeta, director of real estate services for the National Association of Realtors, explained that because lenders are liable for the delivery timing, they will have less flexibility. “As such, lenders are taking a conservative approach for good reason: a loan that has a potential RESPA/TILA error will at a minimum be difficult to sell on the secondary market. Lenders are not going to be very tolerant of last-minute changes,” he wrote on the ALTA website.

Long term, the regulations may also result in less options for consumers as they seek a mortgage loan.

“The cost of compliance is forcing a lot of people to consider whether it’s profitable to stay in mortgages,” DocMagic’s Anderson said. “The intent of the regulation was to provide the consumer more choices — if the end result is that we are reducing choice for the borrower, that’s not good for anybody.”

TILA-RESPA tidbits from the CFPB

1. The TILA-RESPA rule consolidates four existing disclosures required under TILA and RESPA for closed-end credit transactions secured by real property into two forms: a Loan Estimate that must be delivered or placed in the mail no later than the third business day after receiving the consumer’s application, and a Closing Disclosure that must be provided to the consumer at least three business days prior to consummation.

2. The TILA-RESPA rule does not apply to HELOCs, reverse mortgages or mortgages secured by a mobile home.

3. The Good Faith Estimate has been combined with the initial Truth-in-Lending disclosure into the new Loan Estimate form.

4. “Business Day” for providing a Loan Estimate is a day on which the creditor’s office are open to the public. “Business Day” for counting days to ensure the consumer receives the Closing Disclosure on time means all calendar days except Sundays and legal public holidays.

5. Creditors may only use revised or corrected Loan Estimates when specific requirements are met.  Creditors generally may not issue revisions to Loan Estimates because they later discover technical errors, miscalculations, or underestimations of charges. Creditors are permitted to issue revised Loan Estimates only in certain situations such as when changed circumstances result in increased charges.

6. An application means the submission of a consumer’s financial information for purposes of obtaining an extension of credit. An application consists of the submission of the following six pieces of information: the consumer’s name, income, Social Security number to obtain a credit report, the property address, an estimate of the value of the property and the mortgage loan amount sought.

7. Whether or not a Loan Estimate was made in good faith is determined by calculating the difference between the estimated charges originally provided in the Loan Estimate and the actual charges paid by or imposed on the consumer in the Closing Disclosure. Generally, if the charge paid by or imposed on the consumer exceeds the amount originally disclosed on the Loan Estimate, it is not in good faith, regardless of whether the creditor later discovers a technical error, miscalculation, or underestimation of a charge. However, a Loan Estimate is considered to be in good faith if the creditor charges the consumer less than the amount disclosed on the Loan Estimate, without regard to any tolerance limitations.

As featured by HousingWire, April 2015

TORRANCE, Calif., March 17, 2015 (SEND2PRESS NEWSWIRE) --DocMagic, Inc., the premier provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions, announced that HousingWire magazine designated the company to its 2015 HW TECH100(TM) list. The list honors the 100 most innovative technology companies serving the U.S. mortgage finance and real estate industries.

HousingWire states that more than 250 companies were evaluated by HousingWire editors for the 2015 program, which looks at technology innovation along six different categories: uniqueness of solution, growth, market influence, market potential, elegance of implementation, and "something else entirely" -- a catch-all for disruption and other factors that drive innovation. 

"This year we were struck by the level of innovation we saw, with 40 new additions to the HW TECH100," stated Jacob Gaffney, executive editor at HousingWire. "That speaks to how much change is taking place in the mortgage industry overall right now; we're seeing a lot of market disruption, and technology providers are clearly taking advantage of the opportunity that creates."

DocMagic has grown at an enviable rate over the past year, adding new staff, signing marquee clients, acquiring eSignSystems and Doc-Tech Corporation, and working closely with the Consumer Financial Protection Bureau (CFPB) on its eClosing pilot program, among other significant projects. 

The company's future growth plans are aggressive. They include penetrating new markets, developing into a single-source eServices provider that is the nucleus of the eMortgage process, and continuing to guide the mortgage industry to adopt paperless origination and closing processes.

"We've had some major accomplishments and company milestones in the last year and are pleased that the editorial team at HousingWire has recognized our innovations and industry contributions," said Dominic Iannitti, president and CEO of DocMagic. "Making the HW TECH100 list is the direct result of the amazing people we have working for us, their passion for and commitment to developing leading technology solutions and providing unparalleled customer support." 

About DocMagic:
DocMagic, Inc. is a leading provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions for the mortgage industry. Founded in 1988 and headquartered in Torrance, Calif., 

DocMagic, Inc. develops software, mobile apps, processes and web-based systems for the production and delivery of compliant loan document packages. The company's compliance experts and in-house legal staff constantly monitor legal and regulatory changes at both the federal and state levels to ensure accuracy. For more information on DocMagic, visit http://www.docmagic.com/. 

About HousingWire:
HousingWire is the nation's most influential industry news source covering the U.S. housing economy, spanning residential mortgage lending, servicing, investments and real estate operations. Winner of numerous awards, including a 2012 Eddie Award for national editorial excellence in the B2B Banking/Business/Finance category, HousingWire has been recognized for excellence in journalism by the Society of Business Editors and Writers, the American Society of Business Press Editors, the National Association of Real Estate Editors, and Trade Association Business Publications International. Learn more at http://www.housingwire.com/. 

About the HW TECH100:
The HW TECH100(TM) highlights the housing economy's 100 most innovative technology companies, along six unique dimensions of innovation. The annual awards program is the only program of its kind to include technology serving both the U.S. residential real estate and U.S. residential mortgage industries. Learn more at http://tech100.housingwire.com/. 

DocMagic Inc., a provider of loan document preparation, compliance, e-sign and e-delivery solutions to the mortgage industry, has integrated World Wide Notary Inc.'s (WWN) patent pending DigaSign e-notary technology with DocMagic's eServices platform to deliver a fully paperless e-closing solution.

As per a company press release, the solution allows borrowers, lenders, settlement agents and mobile notaries to e-sign and e-notarize paperless mortgage documents.

"The addition of WWN's advanced e-notary capability adds significant value to our platform by keeping mortgage closing documents 100 percent paperless, from e-disclosure to e-closing," says Dominic Iannitti, president and CEO of DocMagic.  "DocMagic has systematically been putting the necessary pieces in place to transform the company into a true end-to-end e-services solutions provider. Our exclusive arrangement with WWN incorporates a critical component: compliant e-notarizations. Without compliant e-notary capability, a fully paperless e-closing would be impossible to achieve."

As featured by MortgageOrb, March 2015

By Brena Swanson

 Continues to push for online mortgages

DocMagic continues its push to bring the mortgage process online, announcing it formed an exclusive relationship with World Wide Notary to deliver a fully paperless eClosing solution.  

WWN’s patent pending DigaSign eNotary technology will be integrated into DocMagic’s eServices platform to deliver a fully paperless eClosing solution, the companies said.

WWN is a developer of electronic notarization services for a variety of different industries. Multiple Secretaries of State under the National Association of Secretaries of State eNotary standard certify the company, along with all states that have approved the Uniform Electronic Transactions Act.

DocMagic said in an interview with HousingWire earlier this year that its biggest opportunity in 2015 will be ‘riding’ the eWave. “This means that we will be material in transitioning increasingly greater numbers of our customers to an eEnvironment that is highly regulated and highly competitive. Customers are unique and one size doesn’t fit all. It will be a time of great learning for everyone in this market --- everyone,” said Don Iannitti, president and CEO of DocMagic.

And with this new partnership, borrowers, lenders, settlement agents and mobile notaries can eSign documents and eNotarize, online and offline.  

“DocMagic has systematically been putting the necessary pieces in place to transform the company into a true end-to-end eServices solutions provider. Our exclusive arrangement with WWN incorporates a critical component: compliant eNotarizations. Without compliant eNotary capability, a fully paperless eClosing would be impossible to achieve,” said Iannitti.

Under the agreement, DocMagic has exclusive rights to utilize WWN’s eNotary platform within the mortgage industry for an extended period of time. The two companies have already begun introducing the service to clients.

As featured by HousingWire, March 2015

By Samantha Guzman

DocMagic, Inc., a provider of fully-compliant loan document preparation, compliance, eSign, and eDelivery solutions, announced today that it formed an exclusive strategic alliance with World Wide Notary, Inc. (WWN), a pioneering developer of electronic notarization services. The partnership integrates WWN’s patent pending DigaSign eNotary technology into DocMagic’s eServices platform to deliver a fully paperless eClosing solution.

The solution allows borrowers, lenders, settlement agents and mobile notaries to eSign documents, and eNotarize, both online and offline. As a result, the entire closing process is streamlined, paper is eliminated, costs are reduced and compliance is ensured.

“The addition of WWN’s advanced eNotary capability adds significant value to our platform by keeping mortgage closing documents 100 percent paperless from eDisclosure to eClosing,” said Dominic Lannitti, president and CEO of DocMagic. “DocMagic has systematically been putting the necessary pieces in place to transform the company into a true end-to-end eServices solutions provider. Our exclusive arrangement with WWN incorporates a critical component: compliant eNotarizations. Without compliant eNotary capability, a fully paperless eClosing would be impossible to achieve.”

WWN is one of the leading eNotarization companies and has been at the forefront of educating and lobbying the state to accept eNotaries in a variety of different industries. The company’s technology has been certified by multiple secretaries of state under the National Association of Secretaries of State (NASS) eNotary standards; and, in all states that have approved the Uniform Electronic Transactions Act (UETA).

“DocMagic has systematically been putting the necessary pieces in place to transform the company into a true end-to-end eServices solutions provider," Lannitti said. "Our exclusive arrangement with WWN incorporates a critical component: compliant eNotarizations. Without compliant eNotary capability, a fully paperless eClosing would be impossible to achieve.”

A number of efficiencies accompany WWN’s DigaSign eNotary technology that includes dramatically speeding up the notary process on mortgage documents, with Internet connection or without, ensuring strict compliance adherence is met, establishing detailed audit trails, reducing errors, slashing processing costs, reducing risk, and enhancing the overall borrower closing experience. The solution centralizes and streamlines the entire eNotarization process.

“DocMagic is the leading loan document preparation software company in the mortgage industry and an ideal partner to marry our technologies,” CEO of WWN, Bob Rice said. “To date, most eClosings have just been hybrids, meaning: a majority of the lender documents could be eSigned, but those that require a notaries’ signature and seal had to be printed to paper and ink signed. Together, our technologies eliminate that hard stop in the process and allow borrowers to effortlessly eSign mortgage documents, now including those that require the presence of a notary.”

Under the agreement, DocMagic has exclusive rights to utilize WWN’s eNotary platform within the mortgage industry for an extended period of time. The two companies have already begun introducing the service to clients.

As featured by MReport, March 2015

Major partnership enables DocMagic to compliantly process a fully paperless, true mortgage eClosing - from start to finish

TORRANCE, Calif., March 10, 2015 (SEND2PRESS NEWSWIRE) -- DocMagic, Inc., the premier provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions, announced today that it formed an exclusive strategic alliance with World Wide Notary, Inc. (WWN), a pioneering developer of electronic notarization services. The partnership integrates WWN's patent pending DigaSign eNotary technology into DocMagic's eServices platform to deliver a fully paperless eClosing solution. 

The solution allows borrowers, lenders, settlement agents and mobile notaries to eSign documents and eNotarize - both online and offline. As a result, the entire closing process is streamlined, paper is eliminated, costs are reduced and compliance is ensured.

"The addition of WWN's advanced eNotary capability adds significant value to our platform by keeping mortgage closing documents 100 percent paperless from eDisclosure to eClosing," said Dominic Iannitti, president and CEO of DocMagic. "DocMagic has systematically been putting the necessary pieces in place to transform the company into a true end-to-end eServices solutions provider. Our exclusive arrangement with WWN incorporates a critical component: compliant eNotarizations. Without compliant eNotary capability, a fully paperless eClosing would be impossible to achieve." 

WWN is one of the most dominant eNotarization companies and has long been at the forefront of educating and lobbying the state Attorneys General and Secretaries of State to accept eNotaries in a variety of different industries. The company's technology has been certified by multiple Secretaries of State under the National Association of Secretaries of State (NASS) eNotary standards; and, in all states that have approved the Uniform Electronic Transactions Act (UETA). 

A number of efficiencies accompany WWN's DigaSign eNotary technology that includes dramatically speeding up the notary process on mortgage documents, with Internet connection or without, ensuring strict compliance adherence is met, establishing detailed audit trails, reducing errors, slashing processing costs, reducing risk, and enhancing the overall borrower closing experience. The solution centralizes and streamlines the entire eNotarization process. 

"DocMagic is the leading loan document preparation software company in the mortgage industry and an ideal partner to marry our technologies," said Bob Rice, CEO of WWN. "To date, most eClosings have just been hybrids, meaning: a majority of the lender documents could be eSigned, but those that require a notaries' signature and seal had to be printed to paper and ink signed. Together, our technologies eliminate that hard stop in the process and allow borrowers to effortlessly eSign mortgage documents, now including those that require the presence of a notary."

Under the agreement, DocMagic has exclusive rights to utilize WWN's eNotary platform within the mortgage industry for an extended period of time. The two companies have already begun introducing the service to clients.

About DocMagic:
DocMagic, Inc. is a leading provider of fully-compliant loan document preparation, compliance, eSign and eDelivery solutions for the mortgage industry. Founded in 1988 and headquartered in Torrance, Calif., DocMagic, Inc. develops software, mobile apps, processes and web-based systems for the production and delivery of compliant loan document packages. The company's compliance experts and in-house legal staff constantly monitor legal and regulatory changes at both the federal and state levels to ensure accuracy. For more information on DocMagic, visit http://www.docmagic.com/.

About World Wide Notary:
Based in Vernon, Texas and founded in 2003, World Wide Notary (WWN) has developed DigaSign, an innovative, simple, Internet-based service that expedites the signing and/or notarization of documents by utilizing electronic and digital signatures and electronic notarizations. WWN completed the first fully electronic, mortgage closing in California in 2008 and the first electronic real estate closing in Texas in 2004. Pioneering electronic signatures, as early as 1996, WWN's management team has many years of experience working with stringent Federal mandates, such as HIPAA, E-SIGN and UETA regarding security and the use of electronic and digital signatures. Visit the company's website for more information http://www.wwnotary.com/. 

By Kerry Curry

When Rajesh Bhat, chief executive officer of technology startup Roostify, bought his first home, he remembers the process as an unpleasant experience — one he believes most people don't relish as they deal with dozens of players in the transaction and reams of complex documents.

“It’s an infrequent transaction and it’s viewed as something like a rectal exam that you have to go through and you don’t know what’s happening,” he said.

That unpleasant experience of getting a mortgage is beginning to move toward a more consumer-driven process as technology — now more than ever — holds the promise of bringing the mortgage process into the modern era.  “Technology has never played a more important role in the industry,” said Joe Tyrrell, senior vice president of corporate strategy at Ellie Mae, a loan origination system provider.

Two forces are simultaneously driving this change: 1) A tech savvy consumer who is conducting more and more financial transactions online; and 2) A new wave of costly regulatory oversight and compliance standards that make a digitized loan audit trail and the ability to process loans in an efficient and cost-effective manner more paramount than ever.

These two forces have pushed the lending sector forward significantly from some 15 years ago when there was much hype about the eMortgage. The eMortgage never came to fruition in any significant way not only because the technology wasn’t mature enough back then, but also because of the complexity of the mortgage process itself.

Buying a home is a complicated transaction. Just think of all that goes into it: The borrower looks for a lender or gets referred to one. Then there is the prequalification, the application and the required disclosures. That is followed by underwriting, processing, secondary marketing management and closing. There’s also the post-close loan management and transfers, loan servicing, default management, and loan disposition. The conventional loan file has increased in recent years to meet stricter compliance standards and now stands between 400 to 2,000 pages in length, according to VirPack, a provider of document management. Total loan production cost per loan stands at a whopping $6,769, according to the Mortgage Bankers Association. Why must it be so expensive, stressful, complicated and painstakingly slow?

MEET THE SINGLE STACK
The idea that the many complex steps that go into creating a mortgage can be automated, digitized and managed via cloud-based software is gaining significant momentum. This is the concept of the “single stack.”

In the tech world a “stack” refers to all the elements of something. For the mortgage industry, the idea of the single stack is that one platform (digital, automated and based in the cloud) can either meet all of the functional requirements involved in assembling a mortgage, or can serve as an efficient moderator for the process via open APIs (application programming interface), which are now taking off within the mortgage industry.

Companies are approaching the single stack from various angles. Several startups are intent on building a solution from the ground up with consumer sensibility. There are also established mortgage companies with long histories who are improving their existing technology and acquiring smaller players to build out their solutions. Major investment and venture capital firms are also in the mix, providing financial backing.

Mortgages have historically had specialist providers: One company does document imaging, another might do document storage, another would provide the LOS, and another would provide loan pricing, while still another would handle loan transfers to investors. Under the single-stack concept, these multiple providers potentially could still exist with systems that are built out with APIs. Or, the solution might come packaged as an end-to-end solution.

“There is a concept of vertical consolidation — you are a company, you have an LOS and now you are building or buying everything that can feed into the LOS — working toward that single stack,” Bhat said. However, Bhat believes that lenders don’t like the concept of a single technology company trying to own the entire stack.

THE STARTUP PHILOSOPHY
Startups see themselves as “disruptive” forces in the mortgage industry — out to change it and improve it — much in the way that Apple disrupted the computer and mobile phone industry or in the way Salesforce disrupted the customer relationship management market.

Roostify, based in the San Francisco Bay area, was founded less than three years ago by Bhat, who comes from an IT background. It launched its technology in January 2014. The company touts that its key leaders are technology gurus not mortgage professionals.

“The solution that we’ve designed and that we continue to evolve puts the consumer first,” he said. “The notion is by putting the consumer first, you are going to drive all sorts of efficiencies for everyone downstream — whether it is the loan officer or the processer or the underwriter or the Realtor or the title officer.”

Bhat said the technology allows consumers to create a very pristine mortgage application in a very quick time period, pulling in data from online sources. He touts that the technology is easy to deploy and LOS agnostic.

“I think the single stack from a lender’s perspective is ideally a seamless experience for every single party,” Bhat said. “They don’t need to necessarily be in the exact same system. For example, you could have Roostify as the entry place for the borrower but the lender continues to work in their LOS. The single stack is not technology in and of itself. It is more of an experience.”

New Jersey-based Blue Sage Solutions takes a similar philosophy to leverage open standards and APIs to allow lenders to plug in other proven high value functionality options, said Rob Strickland, senior vice president of sales and marketing at Blue Sage. “A lender looking to provide robust tools for their loan officers could plug in our CRM system or Web portals to their current environment using Web services or other applicable integration options,” he said. “Our applications are designed to work seamlessly together but lenders can also leverage key modules independently as well. With this approach, lenders have the most flexibility assuring they are not held hostage to an inferior, inflexible solution stack.”

Blue Sage’s core team is comprised of experienced senior mortgage technology professionals previously with Palisades Technology Partners where they delivered the first completely web-based end-to-end origination platform serving five of the top10 lenders. Palisades was sold to IBM in 2006. Blue Sage was founded in 2011 and went live with its technology in 2013.

Its digital origination supply chain includes the core functionality to produce a loan: a website portal, a CRM, a LOS and mobile apps. The total solution provides about 80% of the functionality a company needs to produce a loan. It injects intelligence into its platform that allows lenders to write specific rules or to plug in their favorite vendor partners to complete the system.  The automated process reduces costs and errors, and allows lenders to slice data in a granular way for compliance.

Blue Sage is going after the middle market — lenders making 1,000 to 5,000 loans per month. “The mortgage — its time is now,” Strickland said. “People are requiring easier access to information so they can understand one of the biggest financial transactions of their life.”  Lenders need to understand what is available to them for a digitized, automated and cloud-based loan process and then evaluate who is the best partner to deliver it, he said.

San Francisco-based Blend Labs believes it has developed a solution that solves an important need in the market. Founded in 2012, the Silicon Valley tech company has created an operating system for mortgage originations and servicing. It rolled out its first set of marquee applications for loss mitigation and customer service in July 2014. Like other firms in the space, it uses open APIs to allow for lender customization. An audit tool that allows risk managers to identify the riskiest loans in their portfolios was rolled out at the beginning of this year. A mobile borrower experience app is expected to go live this summer.

“We are very bullish on our opportunity in the industry,” said Pranay Kapadia, vice president of product management, who joined Blend from Intuit where he was head of product for Mint.com, and prior to that Mobile Payments and QuickBooks.

“We don’t consider ourselves to be single stack, but we do want to be the platform that drives a real-time information exchange, from borrower to bond, that does not exist today,” Kapadia said. “We believe in connectivity with partners that is seamless.”

Blend Labs was started by veterans of Palantir Technologies, a deep Silicon Valley technology firm that empowers government and commercial customers to solve their hardest data challenges. In the wake of the mortgage crisis, Palantir worked with several large financial institutions and witnessed first-hand what happens when organizations have poor infrastructure to handle massive amounts of incoming data, Kapadia said.

In 2012, a core team left Palantir’s commercial group to form Blend Labs. The team knows big data and comes at the solution from a robust technology perspective, Kapadia said.

It has built out a workflow and process engine that can be rolled out and customized quickly. “One of our customers rolled out an application on our platform in two weeks and in the third week they had realized $1.6 million in loss-mitigation savings,” he said. The app allows a portfolio manager to test different loss-mitigation strategies with different pools of loans.

Some originators are still using desktop software that can take 12 to 24 months to update, and some servicers are tracking data in Excel and Sharepoint, a process that Kapadia calls “completely broken.” Further down the pipeline, when data goes from the servicer to the investor, it often travels by CSV files so investors are unable to see payments in real-time.

Blend Labs collects data in a way that allows a lender to drill down into details, Kapadia said. For example, its call center app allows the servicer to track every call and to note its duration, point of contact, as well as actions taken. Based on call duration and the total number of loans, the servicer is then able to determine requisite staffing in order to deliver customers the best service possible.

BRINGING EXPERIENCE
Not everyone making a run at the single stack is a startup. A number of well-established mortgage companies are in the mix. Pleasanton, California-based Ellie Mae, an LOS provider known for its Encompass mortgage management system, has been around a long time.

“For us, everything starts with compliance,” said Ellie Mae’s Tyrrell. “The concern for lenders with buyback risk is really the place where they start every decision that they make. Compliance drives everything that lenders are evaluating.”  The company, through automation, is looking for ways to improve loan quality and add efficiency to the mortgage process. It plans to introduce consumer-direct and mobile applications this year.

“It’s not about the stack,” said Tim Anderson, director of e-services at DocMagic, a loan document preparation company that has been around for more than 25 years. “What it is about is the consistency in how systems handle data. Our lenders are concerned about consistency in calculations. Consistency in interpretation of data. Having a single source of truth.”

Part of Ellie Mae’s strategy has been acquisitions to provide an end-to-end solution for the mortgage. It has acquired five companies in the past few years: Online Documents, a document service; Mavent, a compliance service; MBS, a product/pricing service; MortgageCEO, a CRM; and AllRegs, an investor/lender guidelines company.

Anderson believes the Consumer Financial Protection Bureau is driving much of the move toward technology adoption and acceptance in the mortgage sector. 
“It’s not what they want (in technology) anymore,” he said. “It’s what they’ve got to do to be legally compliant.”

DocMagic has been participating in the CFPB’s eClosing pilot. The pilot will explore how the increased use of technology during the mortgage closing process could affect consumer understanding and engagement and save time and money for consumers, lenders, and other market participants.

It’s important for the whole process to be electronic, not just the closing, Anderson said. Electronic audit evidence of who saw what, when and how will become very important from the beginning of the mortgage process to the delivery to the investor to be compliant with new regulatory requirements, he said. DocMagic uses a common enterprise system that updates data and documents simultaneously.

“Our documents are data driven, not static, image driven,” Anderson said. “The data we capture out of the lender’s LOS, dictate what the view — or output — looks like, whether it is electronic or paper that is just the view of the data.”

When a document is e-signed, it is wrapped with a tamper evident seal.

“When you paper-out, you lose control of the data, you lose control of the documents. You’ve lost data-document integrity when you paper out. If you start electronic and keep it electronic, you are going to have a much better experience for all parties.”

THE FUTURE
Unlike all the past hype of the e-mortgage, Ellie Mae’s Tyrrell believes technology today really will change how mortgages are done.“Our industry has always been one of the last bastions of technology adoption, but with advent of so much regulation, it has really forced our industry to look for ways to adopt and embrace technology,” he said. Companies in this space admit the competition is fierce. But that can be a good thing, says Roostify’s Bhat.

“I think everyone has something interesting to bring to the table,” he said. “They are all addressing a problem that they are seeking to solve. I suspect there may be some consolidation in these sorts of companies as the problems and solutions overlap. It is good in the sense that it will be good for the industry — to push the industry forward.”

BORROWERS DRIVE THE DIGITAL MORTGAGE EXPERIENCE
HousingWire sat down with Ghazale Johnston, [knew her at FreddieMac] a managing director with Accenture Credit Services, to discuss the complicated dance between what borrowers want and what lenders can offer when it comes to the digital mortgage experience.

HousingWire: How is new technology changing the mortgage market?

Ghazale Johnston: A new class of technology-savvy home loan borrowers is putting pressure on lenders to make the move to a more digital mortgage experience. Many of these consumers increasingly want to go online to rate shop, submit the application, have real-time access to loan status and upload and sign documents electronically. A recent Accenture survey of U.S. retail banking customers found that online sales of mortgages increased 75% from the previous year. Borrowers’ demand for convenience, easy access and transparency is forcing the mortgage industry to invest in better customer-facing digital tools.

HW: What are you hearing that lenders want in digital, automated and efficient cloud-based solutions to the mortgage origination process?

GJ: Lenders want an efficient workflow-driven approach that moves loans rapidly though the mortgage cycle, helping to save time and effort. Through the disaggregation of tasks, greater automation and improved quality control, lenders can achieve faster cycle times and a lower cost to serve. Automation can eliminate 15% to 25% of back-office data entry and other administrative tasks.

Additionally, more sophisticated use of customer data and analytics can help lenders predict customer behaviors and emotional drivers, enabling them to create a set of personalized recommendations and services tailored to unique borrower segments such as first-time home buyers.

Lenders also want to play an expanded role in the home buying process. To do so, lenders must leverage digital technology to engage with customers even before they apply for a mortgage. Accenture research found that more than half of customers want their bank to proactively recommend products and services for their financial needs. More than 40% of retail bank customers are interested in having their bank recommend local Realtors and homes that fit their needs, in addition to getting a mortgage, according to our research.

HW: Where does Accenture fit into the single stack mortgage: the idea that one platform can either meet all of the functional requirements involved in assembling a mortgage, or can serve as an efficient moderator for the process via open APIs, which are now taking off within the mortgage industry?

GJ: The goal should be a simplified application architecture with a single LOS. Some lenders still have to access as many as 15-20 different systems from application through closing. This slows down the process, creates data integrity issues and results in a poor user experience.

While a single platform can enable a more efficient end-to-end process, technology alone is not a silver bullet. Highly trained staff and first-rate processes are also vital. These are among the many capabilities Accenture has assembled to achieve its goal of having the industry’s most efficient mortgage manufacturing operation. For example, we have applied lean manufacturing principles to drive efficiency and consistency across the process. We have also built the Accenture Credit Services Mortgage Academy in the U.S. and India to grow our own talent and teach the “Accenture Way” to process mortgages. Our investment in SAFE ACT licensing for our delivery center in India has also broadened our ability to help our U.S. operation “get today’s work done today” and maintain compliance.

As featured by HousingWire, March 2015