Nancy Alley: eClosing Best Practices, Part III: Navigating the Complexities of Settlement Agent and Notary Support
(Originally published Apr. 20)
Nancy Alley is vice president of strategic planning for Provo, Utah-based Simplifile, an online service that connects lenders, settlement agents and counties. She is a two-time winner of the MBA Tech All-Star Award. She can be reached at nancy.alley@simplifile.com.
Part I of this series covered pursuing quick ‘e’ wins to drive internal adoption, while Part II shifted to driving adoption with stakeholders outside of the executive/decision-making team. This final installment addresses support for settlement agents and notaries.
One of the more complex and often overlooked steps of a lender’s digital mortgage strategy is planning for how eClosing initiatives impact the settlement agent and notary. Even though momentum for eClosing adoption is on the rise, the vast majority of agents and notaries have no or limited first-hand experience performing an eClosing with a borrower. Based on this limited experience – and paired with the importance of the agent and notary roles – lenders must have a clearly defined eClose strategy for supporting agents and notaries that includes the overall ease of use of the technology, methods for keeping agents informed and how to optimize support and training for their agents and notaries.
Ease of Use – How easy is it for agents and notaries to understand and use the lender’s chosen eClosing platform? Agents’ number one complaint is that there are too many systems to learn and too many logins to remember. If agents and notaries have to learn a brand new system for each lender, lenders cannot hold out much hope for buy-in and continued adoption from these parties. This is not to suggest that there won’t be a technology learning curve for agents as lenders transition to digital, but making the transition easier by leveraging a few, best-in-breed solutions will drive agent comfort and willingness to adopt.
Also, does the eClosing technology solution clearly delineate the ink and electronic workflows for the agent? When requesting agents or notaries to change processes, lenders must be certain that the technology solution does not require agent or notary interpretation of the workflow. The eClosing technology must guide the agent through next steps and mirror a process similar to a traditional paper closing while highlighting the new, digital pathways. Agents and notaries should be able to easily adopt the technology and also realize efficiency gains by eliminating some or all of the paper depending on the level of “e” for each eClosing.
And most importantly, the agents need to be rewarded with eClosing loan volume to create muscle memory around the eClose platform and process. The quickest way to make eClosing easy for agents and notaries is to send them eClose loans, making eClose their new normal.
Keeping Agents Informed – There are several key items to communicate with agents and notaries when deploying a digital strategy. Even before going live, lenders must announce their eClose plans to their database of settlement agent and notary partners and follow up on this communication by offering video, documentation and live training opportunities. Not only does this drive commitment from these partners to helping the eClosing launch succeed, but it also sets expectations and drives trust. When the first eClose loan order is delivered, the agent is expecting it and is ready to go.
Once eClose is live, communication requirements increase dramatically. Lenders must communicate with agents and notaries on a per-loan basis about key milestones. Notifying agents that an upcoming loan is eligible for eClosing, that the eClosing package has been delivered or that the borrower has eSigned their documents are all critical communications. Leveraging technology to create this transparency saves time for internal staff and the agent both before and after closing. For example, some lenders allow borrowers to eSign any documents in the closing package that do not require notarization prior to meeting with the notary. Many closing systems only send the ink docs to the agent, leaving them in the dark on the borrower’s signing status prior to closing. As a result, it is possible that that final document packages could come back having only been partially signed, driving up errors and post-closing costs. There should be a mechanism for lenders to make the agent their ally in this process by helping the borrower finish eSigning, thereby maximizing “e” and making sure things are complete.
In addition to the closing milestones, the agent needs transparency on the flavor of eClose. Will the transaction be executed using a hybrid process, or is the agent going to be eNotarizing documents? Acceptance is slowly growing for eNotarization/remote online notarization (RON) of recordable instruments, which can then be eRecorded. However, the reality is that these processes are not legal in every jurisdiction. Even when they are legal, that doesn’t mean the county will accept it on a security instrument. The acceptance permutations are endless, and agents can’t be expected to know every nuance. Lenders need to implement an automated process for communicating eEligibility information down to the agent and notary on a per-document basis to ensure everyone is on the same page.
Support & Training – What resources are available for agents and notaries when they need assistance conducting their first eClosing? Although the lender is the ultimate decision-maker in the selection of eClosing technology, agents and notaries will have to use the system to execute the closing ceremony. Thus, live customer support and training should be made available, specific to their role and based on the loan’s eEligibility. It is important that a lender’s vendor of choice provides various training tools in support of agents and notaries conducting eClosings using their technology. This must include having live support available versus simply providing a link to self-guided online resources. If the vendor only provides the latter, lenders will ultimately bear the burden of providing agent/notary support for their chosen platform – something which many organizations are ill-equipped and disinclined to manage.
The role agents and notaries play in lenders’ execution of a digital mortgage strategy is undeniable, and driving eClosing adoption requires agent and notary support for every closing package type, including hybrid loans. Building this important agent and notary framework can be the difference between success and failure in this brave, new world of “e.”
(Views expressed in this article do not necessarily reflect policy of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes your submissions. Inquiries can be sent to Mike Sorohan, editor, at msorohan@mba.org; or Michael Tucker, editorial manager, at mtucker@mba.org.)
