*Getting A Second Opinion*
**By Tony Garritano**
***Anytime you get a bad health diagnosis you should always get a second opinion. It seems, the same is true in politics. Today the Supreme Court rendered a second opinion on the president’s signature health care bill. The saying it’s better to be safe than sorry certainly applies. And on the health care issue, it now seems like we the people will have to render a third opinion when we vote. So, no matter your political leaning, don’t forget to vote. Yesterday I asked I asked Eric Kujala at DocVelocity about exactly how many people go into processing a loan. Today I want to bring you a second opinion from Sharon Matthews, President and Chief Executive Officer of eLynx. Here’s what she said:
****“Everything starts with the Loan Officer who takes the application. From there the Registration Clerk sets up the application file, enters everything into LOS, and may also get the rate lock agreement prepared. Then the Processor handles order outs to get income verification, the preliminary title report, flood certifications, a hazard insurance binder, etc. The Appraiser appraises the property. The Underwriter evaluates the loan application and makes a decision.
****“Remember, the closing process also involves a lot people. The Title Agent researches title on the property. The Closing Registration Person logs the approved loan into the system. The Closer completes the loan with the borrower. The Settlement Agent works with Closer on closing docs. The Notary notarizes documents, as required. Finally, the Funder completes the necessary paperwork to get funds wired,” Matthews pointed out.
****After getting this second opinion I concluded, as I shared with you yesterday, that there are a lot of people that go into completed what is an unnecessarily complicated process. As I was talking with Sharon I went a bit further and asked her how these processes could be improved. She said:
****“eDelivery capabilities facilitate the low cost sending of disclosures, rate lock letters and many other RESPA required documents to borrowers. They also help lenders lower compliance risk by substantiating that such documents were delivered on time and as required. Also, eSignature technology enables signatures to be appended to valuable documents such as the promissory note. These signed documents can then be stored online in a secure, tamper proof environment. Access is subsequently provided to borrowers, lenders and investors, as needed. Integrated printing capabilities, can ensure that borrowers still receive required documents even if the eDelivery is not read on line. When provided by the same vendor that handles eDelivery, as eLynx can do, the switch to print can be seamless, quick and cost-effective.
****“In general, eCollaboration software can help in the preparation of the settlement statement, including the traditionally highly manual process of reconciling the final HUD statement with the GFE. Electronic HUD capabilities, such as the eLynx offering, can identify, in advance of the closing table, line items with discrepancies between the final closing HUD and the final GFE. To reconcile, the closer and settlement agent can look back at all interim versions of both documents to see who made which changes when and where. These capabilities speed up the closing process, and reduce unexpected closing delays, as well as the associated additional costs borne by the lender caused by these delays.
****“Fraud can frequently occur in the settlement and closing phase of loan. Here, verification systems can ensure that trusted 3rd parties are authorized to handle the closing. This could include verification of the agent’s identify, and that said agent is the designated individual assigned to close the loan. Once all loan documents are ready, the borrower can preview final closing documents using eDelivery and sign using eSignature. These capabilities again speed the closing process and lower the pressure borrowers sometimes feel at the closing table. Finally, the ability to print closing documents that have been eDelivered to multiple parties ensures that a quick but low cost option is available if needed.”
****I cannot agree more with Ms. Matthews’ assertions about how technology can improve the mortgage process. I hope everyone reading this column today is really listening to what is being said. Now is our opportunity to improve our business and get back to offer every homebuyer their piece of The American Dream.
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 email@example.com.