Paul Anselmo of Evolve Mortgage Services: Defragmenting the Digital Closing Process
Paul Anselmo is CEO and founder of Evolve Mortgage Services, Frisco, Texas, a provider of outsourced mortgage platforms. He has more than 30 years of experience in the banking and mortgage industries. Previously he served as president, CEO and founder of Mortgage Resource Network (MRN), a business process outsourcer and technology provider to the mortgage industry. In 2019, he was honored as a “Lending Luminary” by the PROGRESS in Lending Association. He can be reached at email@example.com.
MBA NEWSLINK: How would you characterize the current state of digital mortgage closings?
PAUL ANSELMO, Evolve Mortgage Services: Digitization in the mortgage industry has been a very long road. It’s quite amazing to know that it’s been more than two decades since President Clinton signed the Digital Signature Act, yet a totally digital process has been elusive.
Today, there are a lot of players in the market that offer only partial solutions for a digital closing. The process involves numerous vendors who each come in with one component, then work out band-aid integrations with other technologies to do their best to string together a digital closing process. But until recently, no single platform existed that was able to create a seamless, end-to-end digital process.
NEWSLINK: How does that impact the mortgage process?
ANSELMO: Borrowers are the ones who suffer. They start on one platform where they electronically sign disclosures. When they get to closing, suddenly they are moved to a different platform. In addition, they might have to go to a separate signing room to sign an e-Note. And if it is a RON (remote online notarization) transaction, they could be faced with yet another platform.
For borrowers, it’s a very fragmented and confusing process to say the least. Having to shift from one system to another makes zero sense. It’s equally fragmented for lenders and loan officers, too. These different platforms generally do not integrate well with each other if they do at all. A lot of time is spent on workarounds and manually rekeying in information, which not only wastes time and money, but increases the chance of mistakes.
NEWSLINK: Why are there so many fragmented platforms instead of just one?
ANSELMO: There are a number of reasons. Very few companies have the resources and expertise to pull together all the required pieces of a digital mortgage into one system. Instead, you have a lot of small players who provide only one piece of the process. Right now, to complete a digital online closing, lenders have to depend on other platforms. Another obstacle is that the industry has yet to become fully standardized when it comes to digital closings.
NEWSLINK: How is the industry making process on standards?
ANSELMO: The industry has developed data standards for digital closings through the Mortgage Industry Standards Maintenance Organization, or MISMO. MISMO provides standard specifications for SMART Docs, which are single electronic documents that bind together data and presentation along with other information. SMART Docs are critical for digital mortgages. MISMO is also developing standards for eMortgages, RONs, eDoc/eMortgage Vault Interoperability, and other areas that are equally important for digital closings. We’ve been involved with a number of these efforts. In fact, several members of our leadership team, including Charles Epperson, our CTO, and Tim Anderson, our director of eMortgage strategy, have served on multiple MISMO workgroups and committees.
NEWSLINK: How come MISMO standards haven’t seen industry-wide adoption?
ANSELMO: For one thing, many vendors haven’t made the necessary investments to keep up with MISMO standards. Some vendors cannot even produce an e-Note. Another factor is that lenders have not been very proactive on improving the loan process or their technology platforms. Recently, most lenders have more business than they can handle, so they haven’t been as motivated to move to SMART Docs, which leverage MISMO standards. However, adoption is relatively easy with the right partner.
NEWSLINK: How does Evolve Mortgage Services help defragment the process?
ANSELMO: First, every loan document we have – not just the note – is a SMART Doc. This is key, because SMART Docs enable a seamless, secure flow of data from the point-of-sale to closing. Second, with our recent acquisition of E-Notary Seal, we have all of the digital pieces needed for an e-Closing on a single platform. In fact, we are one of the only digital closing platforms that offers an end-to-end digital process within one ecosystem, without the patches used by other platforms or the need to intervene manually to close a digital loan.
With the Evolve platform, lenders and title companies don’t have to worry about our relationships with other vendors in order to provide their customers with an end-to-end digital experience. Ultimately, by defragmenting the entire process from beginning to end, we’ve made it much easier for them to make the transition to digital mortgages so they can start providing borrowers with the faster, simpler loan process they deserve.
(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 firstname.lastname@example.org; or Michael Tucker, editorial manager, at email@example.com.)