Evolve adding RON services to loan modification closings

Evolve Mortgage Services' e-closing technology will now allow remote online notary services for loan modifications, which are due to see an increase in use as large numbers of forbearances end in the coming weeks.

Approximately 1.6 million borrowers are in forbearance, according to a Mortgage Bankers Association survey released on Aug. 23. Black Knight's data, pulled from its servicing system, found 1.75 million borrowers in forbearance as of Aug. 17.

During the final two weeks of August, around 200,000 plans are slated for review, with approximately one-third of those reaching their final expiration based on current allowable forbearance term lengths, Black Knight said.

It previously estimated that 65% of all active plans — including 80% of Federal Housing Administration and Veterans Affairs loans in forbearance — are set to expire throughout the rest of the year, with nearly 750,000 of that happening in September and October.

"Over the course of just two months this fall, the nation's mortgage servicers would have to process up to approximately 18,000 expiring plans per business day, guiding borrowers through complex loss mitigation waterfalls directed by changing regulatory requirements," Black Knight Data & Analytics President Ben Graboske said in an Aug. 2 blog post. "The operational challenge this represents is staggering, even before noting the oversized share of FHA and VA loans."

Some in the servicing industry are worried that these borrowers will not be able to make their contractually obligated payments and may even be unable to pay a reduced amount.

RON usage for purchase and refinance transactions boomed in 2020 as a result of COVID and the need for social distancing. In recent weeks, the delta variant has brought a surge of cases and some states are issuing mandatory vaccination and masking requirements.

"With the potential for new social distancing measures, RON capabilities for consumers are essential," Tim Anderson, Evolve Mortgage Services executive vice president of emortgage strategy, said in a press release. "We are proud to help our servicer clients during this difficult period."

With eModifications, mortgage servicers will be able to provide borrowers a secure online environment to review, electronically sign and digitally notarize loan modification closing packages.

This product will also enable servicers to track and prove electronic evidence of compliance with the Consumer Financial Protection Bureau's servicing rule that goes into effect on Aug. 31, according to Evolve's announcement.