Notaries may soon see a rise in paperless mortgages, driven by changing industry standards and new regulations, according to a recent article by John Adams in the American Banker.
Among other things, the article cited a 2012 industry survey by Xerox that found that 43 percent of lenders expect more than half of all mortgages will be closed electronically by 2016. That’s a 54-percent increase from 2011.
The survey found that as mortgage laws, regulations and standards evolve towards tighter controls, more detailed disclosures and standardized forms, mortgage industry professionals see the ability to create an audit trail as one of the most important benefits of paperless mortgages. This audit trail will help lenders comply with new government regulations and industry initiatives.
“We’ve been waiting for lenders, http://www.kprisocklegal.com/wp-admin/post.php?post=1&action=editclosing agents and county recorders to go paperless for some time,” said William A. Anderson, the National Notary Association’s Vice President of Best Practices. Electronic mortgages will still require borrowers to have their signatures notarized on the deed of trust or any other loan documents requiring notarization. E-mortgage transactions should help signing agents do their jobs more quickly and efficiently, and at a lower cost too, since there will be no loan documents to print for the signing.
The use of this technology will require cooperation among lenders, borrowers, closing agents and servicers who must all work together to process an electronic loan document.