Most people recognize “Can we talk?” as a catchphrase used by the late Joan Rivers. But it should be a phrase that lenders are asking of their business partners and borrowers. Many of the regulations and pilot programs introduced recently will fundamentally change the way that lenders will interact with them both.
Let’s start with the consumer. The Consumer Financial Protection Bureau (CFPB) is responsible to make sure the American consumer gets all of the information they need to make an informed financial decision when it comes to mortgages, credit cards or other types of consumer financing. To ensure borrowers are kept informed throughout the lending process, lenders are being asked to provide consumers with information and documentation from the point of sale through servicing the loan. Consumers must receive copies of their initial disclosures, appraisals, closing disclosures and documents, privacy notices and many others. The result is that consumers are becoming involved in the mortgage process as never before.
To facilitate this new level of interaction with borrowers, many lenders are turning their static websites into interactive communication portals. Instead of just presenting information to a consumer or asking them to fill in a form or application, lenders are creating a two way dialogue with their customers. They are implementing tools such as: live chat where a consumer can electronically chat directly with a loan officer or help desk; secure messaging for communicating sensitive non-public personal information; document exchange where consumers can go to not only electronically view their documents, but also send documents back to the lender if necessary; and finally electronic signatures where borrowers can electronically sign and return documents with the click of a mouse or the tap of a screen. With today’s on the go consumer, these features need to be available not only from a consumers computer, but from their smartphones and tablets as well.
But it’s not only borrowers that lenders need to step up their communications with. Business partners such as closing agents, attorneys and title companies are going to need additional attention as well. Starting in August of this year, the current Truth in Lending disclosure document and HUD-1 Settlement Statement will be combined into a single document known as the Closing Disclosure. Currently, in many cases the HUD-1 statement is not produced by the lender but rather by the closing attorney and is delivered to the borrower at the closing table. But since the HUD-1 is now included in the final Closing Disclosure, and the final Closing Disclosure is required to be provided to the consumer at least three business days prior to the closing, a new level of collaboration between lender and closing agents will be needed. By implementing a communication portal with secure messaging and document exchange, it will be much easier for a lender to streamline this collaborative process.
So the next time you deal with a consumer or business partner, maybe the first words out of your mouth should be “can we talk?
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