Today’s regulatory environment is holding the mortgage industry more accountable than ever before.
Servicers are still finding ways to cope with heightened regulatory scrutiny and continue to evaluate options to increase efficiencies while maintaining legal compliance.
A large part of the compliance accountability is tied to thoroughly documenting each step in the product sale and delivery process.
A paper-driven process will no longer suffice as the need for accuracy and timeliness is at an all-time high. In addition, consumer preference is moving towards a digital process. When working with homeowners, they expect to use advanced technology throughout the entire process, from receiving information and documents to completing and returning forms from any location.
Implementing electronic signature and record capabilities helps mortgage companies in several ways, including by creating more cost effective processes increasing overall efficiency, and enforcing better security and compliance. At the same time, implementing electronic capabilities will also improve borrower relations by enabling homeo
wners to handle documents at their convenience, resulting in shorter timelines and a more positive experience.
Mortgage servicing will always be document-centric; however, sharing and signing documents electronically allows for tighter controls by limiting the number of touch points documents pass through, and greatly reduces the risk of misplacing sensitive documents in the shuffle. With paper files, anyone who comes in contact with the document can remove pages, add entries or interfere with authentic entries. Electronic records are tamper evident, which makes it easier to detect fraud and mitigate the risk of forgery.
There are many misconceptions when it comes to the application and legality of electronic signatures and records in the mortgage world, but there are current efforts underway to change this.
A group of professionals from various industries realized the need for public policy initiatives and the promotion of electronic signature and records technology, and led the charge to make electronic signatures a legally binding way to sign documents.
They were instrumental in the passage of the Electronic Signatures in Global and National Commerce Act (E-Sign Act) which became a law on June 30, 2000. Since this law went into effect more than 13 years ago, millions of documents have successfully benefited from the use of electronic signature and record technology.
The Electronic Signatures and Records Association is still blazing the trail by helping, businesses, including mortgage companies, and the government better understand how they can easily use and accept electronic signatures and records on an enterprise-wide basis. As electronic processes become more prevalent in today’s society, this group of business leaders is creating awareness of the value of electronic processes to the public, businesses and government alike and providing education on the most pressing legal, regulatory and operational issues associated with the use of electronic signatures and records.
ESRA provides a forum for companies from various industries to unite for a common goal—furthering the electronic signature adoption while helping industry professionals remain abreast of changing regulations. With its expansive membership and cross-functional representation, ESRA is uniquely positioned to stay on top of current and future conversations around electronic signatures and records, which makes involvement extremely beneficial for any person or company that in some way touches, or is looking into, this technology.
As the mortgage industry continues to explore e-signature technology, ESRA can be the trusted outlet for education and resources to help manage the compliance complexities during this critical time.
Jeff Knott is secretary, Electronic Signature and Records Association; AVP product management, Equifax Verification Services.
