Building Confidence In Digital Mortgage Fences
“Brand” means a lot of things, but it’s mostly about the customer’s perception. Your brand – the perception your customers have of your business – is affected by every interaction, which means you need to think about how each one builds or erodes trust.
MortgageRs must comply with complex regulations while providing an exceptional customer experience, even during the most difficult phases of the mortgage process, such as fencing.
Since the start of the pandemic, there has been a push in Washington to change the regulatory shutdownto improve the process and the customer experience. Here, I’ll dive into customer perceptions of closings, how COVID is affecting electronic closure policy, and what lenders can do to ensure closures remain a generator of confidence, regardless of the policy.
Be aware of how ‘digital’ closures feel for customers
The typical customer hears a lot of messages and advertisements about a simple digital mortgage. And remember: they don’t know about mortgage law, so the “digital mortgage” seems like a fully online process that’s as easy as as order on Amazon or watch Netflix.
The reality, as we all know, is not that simple.
Some customers prefer to submit documentation through old-fashioned channels. Some documents do not fit perfectly into the digital systems we have built. The resulThat’s because most of today’s mortgages are actually hybrid digital-human processes.
This is especially true for the closing process, where, due to regulations, borrowers may have to sign a huge stack of paper, even when everything else is digital.
TThe result, for an unprepared customer, is a true trust-eroding experience – that is, an experience that can harm your brand.
The good news is that the trust and branding solution is simple: communicate throughout the process. Define expectationions. Explain to clients why you do things the way you are. And use tools like Total Expert to automate the personalization of that communication and training – here’s how. you superpower your human advisers.
Now let’s see how to make the closing process better.
Advocate for universal e-Closings
First, a few quick definitions:
- Electronic closures are those carried out by remote online notary (RON). Borrowers can electronically sign documents with a notary via webcam. Where RON is legal, same day loans can be closed entirely digitally.
- Hybrid closures occur when borrowers remotely sign all documents that do not require notarization, and then on the same day personally sign all documents that require notarization.
Before COVID, RONs were legal in 23 states. Since the pandemic struck, a few others paid emergency allowances. But, as most lenders know, that’s not the whole story.
Some warehouse lenders or investors will not fund or buy loans that do not have wet signatures. Some securities companies cannot insure RON loans. So, even in states where RONs are legal, they may not be feasible.
This, of course, prevents lenders from offering the best possible experience, which may harm their brand.
Here is some good news to fix this problem: SECURE law, introduced on March 18, 2020, would make RON legal within 50 States. Although he did not result in the CARES law, he enjoys bipartisan support, which makes his chances decent.
By advocating for its adoption, lenders and other industry professionals can improve the borrowing experience for all clients by enabling true digital closing.Today’s customers expect more and more. At Total Expert, we are actively lobbying for this in Washington.
Stay confident in the age of hybrid closures
Until the SECURE Act is passed, most closures will remain hybrids.
To ensure these hybrid closures are a trust and brand building experience, lenders should be diligent in preparing borrowers (especially beginners and those who haven’t bought in a while) to know what to expect.
Key message to send:
- They may need to sign some documents twice, both electronically and in person.
- You realize it’s frustrating – and you advocate for a better system (great opportunity to direct them to SECURE Act information).
- You worry about the details so they don’t have to – and if they havefive questions they can contact the sender they have worked with throughout.
Build trust and protect your brand before and after SECURE Act
The customer experience will improve dramatically when the SECURE Act enables a truly digital closure for mortgages and other types of loans.
To make sure that the experience translates into increased customer trust and better brand awareness, you need to start educating your teams on how it will play out. It will make them smarter advisors now and help your organization go faster when the transition happens.
Share articles like this with your teams, and count on your mortgage technology partners who understand all of these nuances and allow you to automate education, build trust and protect your brand from parts of mortgage experience.
And I’ll keep the information coming on how e-lock legislation is evolving in Washington.