Innovate Or Close Shop

Now is not the time for small ideas. Putting a band-aide on a gaping wound won’t help in the long run even if it stops the immediate bleeding. Lenders have long missed this message. Instead of looking at how to improve their overall process, they instead look for little fixes here and there. That mentality won’t cut it anymore.

But things might be changing. When the Consumer Finance Protection Bureau announced the 12 participants of its electronic closing pilot, I was encouraged. The participating lenders and vendors weren’t just talking about improving the closing process, they expressed loftier goals.

For example, Donna Krall, Executive Vice President and Director of Mortgage Fulfillment, Flagstar Bank said, “As a leading mortgage originator, we’re always looking for ways to improve our customers’ experience. We’re pleased to be part of this pilot to align the mortgage closing process to meet the needs of today’s tech-savvy customer. In today’s fast-paced virtual environment, we recognize the importance of an online tool that offers convenience, execution and provides the customer with a positive experience.”

Similarly, Sharon Matthews, eLynx President and CEO, added, “The CFPB’s focus on closings will accelerate the industry’s progress towards the e-mortgage. By objectively evaluating different solutions and collecting performance metrics, the pilot will help identify technologies that improve the customer experience.”

Going beyond just talking about customer service, which in and of itself is a big deal, some of the participating lenders and vendors actually talked about innovation. “Our culture is built around innovation and using technology to make the home financing process easier for our customers and business partners,” Tom Moreno, Vice President and Chief Information Officer of Universal American Mortgage Company/Eagle Home Mortgage, said. “We look forward to working with other industry leaders and the CFPB to realize the vision of a smooth, paperless closing for the consumer.”

Will this enthusiasm for genuine process improvement be permanent or temporary and fleeting? “Lenders are now ready for a completely paperless loan closing process,” answered Dominic Iannitti, President and CEO of DocMagic. “Digital Close from Pavaso is designed to be a neutral technology platform that seamlessly integrates with other systems. That, along with DocMagic’s e-sign, e-vault and e-delivery offerings, provides a fully supported, shrink-wrapped solution for anyone to do an e-closing. This partnership will show the industry and the CFPB that any lender can make the closing process better for consumers through the use of a completely electronic process without incurring the time and cost of creating or maintaining their own systems.”

I hope that these participants of the CFPB e-closing pilot are right. Hopefully this industry will start genuinely innovating because I fear that if it doesn’t there will be far fewer mortgage lenders and technology vendors alike by this time next year.

About The Author


Tony Garritano

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