First things first

All things “e” are NOT necessarily related beyond the fact that they’re part of the mortgage process, and they’re new and improved.  The “e” means electronic.  These are just newer ways to conduct traditional elements of the mortgage transaction. You wouldn’t confuse a closing with a note.  So why do so many get fooled into believing an “eNote” is akin to an “eClosing?” You don’t need to look at everything labelled “e” as part of one exclusive group solution. Your provider may offer eClosings, but not eNotes or eVault solutions. The “e” (we prefer “digital” in 2018) is just a descriptor, and there’s no requirement that your digital solutions come from the same place. 

The eNote

The eNote is the same as a paper note. It’s the medium that has changed. The irony is that when an eNote is processed it is translated back into a “readable” form that looks like paper!  It is a document. That’s it. It is organized into an electronic format to be used in better ways downstream.

If you’re currently shopping for the best way to produce an eNote, I suggest using the same logic you use when deciding where to get your paper note. It is a commodity. There’s no difference from note to note—and none of them have anything to do with eClosing! You see, the eClosing platform must be able to process ALL media, so in the end it does not matter who produced it.  However, to you, it certainly will matter who gets access to the NPI and what technology they use to create your documents.  Don’t make the mistake of thinking you must choose all your “e” solutions from the same developer. The eNote is a document and you’re simply making a decision about documents. Another key component regarding the eNote is that you MUST have eClosing to produce an eNote.

Now, one final warning for you to heed: eNote technology will evolve into SmartDocs at some point.  That’s because SmartDocs are evolving quickly and are much more powerful.  So, consider any decision you make regarding eNotes today to be temporary.

The eVault

The eVault is a storage device designed to receive the processed eNote.  It is the final resting place for the executed eNote produced because of/after the eClosing.  So, for all intents and purposes, eClosing and eNote are NOT related. That means your decision, when choosing an eVault provider, boils down to answering the question “what solution provides the best security for protecting my data?” It is not a decision about eClosing.  You’re simply selecting a commodity.  This is especially true when you consider that all eVaults must follow the same standard and the same construction. The only legitimate differentiator rests with which solution offers the best security for protecting your data. 

The same final warning applies to eVault. It’s highly likely that Blockchain will eventually replace eVault technology in the future.  Blockchain is better technology. It’s more secure and inclusive of all data.  Again, eVault ONLY stores the note.  This will change.

eClosing

Right now, the real decision to be concerned with is eClosing.  Selecting an eClosing provider sets you on your path into the future.  Accordingly, you’ll be asked to consider the closing process and media of today and tomorrow and do it simultaneously. This single component of technology will be a large part of your business process in the future.  

Don’t forget—when you make the move to an eClosing platform, you’re not replacing an old-school cash register with an electronic signing pad.  eClosing is NOT a signing platform, you’re not just taking the pen out of the closing process; the objective is not to simply replace a pen. Instead, it’s a complex platform that you will operate your business on, and will most likely operate for the benefit of the life of the loan. Chances are, the eClosing technology you implement today will be the foundation of your business for the next 10 years.  

This industry is changing rapidly.  For successful firms, change is baked into the business model. This change affects not only how business is processed; the consumer experience; compliance or medium. In fact, this change will ultimately impact how business is attained, chosen, priced and delivered to consumers and capital markets.  Unlike your decisions as to eNote or eVault, which are commodity decisions; the eClosing decision you’re making today is, in fact, an enterprise decision.  

What type of platform should you seek?

Based on all of this, the eClosing platform you choose should meet a few criteria:

• It should have vision
• It should envision and include the thousands of possible circumstances that impact a closing
• It should be able to handle any available medium of closing (paper, hybrid, digital, eNote)
• It should be able to deliver new and different business opportunities you might not have considered. 

After all, the closing is the “birth of a mortgage” and ultimately produces “your product” – the product you manage through portfolio operations or you sell to capital markets —you’ll want to choose the platform you use to produce that product wisely!

Your decisions today will be your business tomorrow

I hope this clears up some misconceptions and removes some barriers you may have in understanding the world of “e”.  Your decisions today will be your business tomorrow.  So, focus on building that future by following a simple principle: “best is the enemy of better.”  Today you are moving from an ink pen to full digital processing.  But that’s just the beginning. You won’t get there all at once. Instead, you’ll evolve. 

Choose to create a program of continuous business process change in which you can bite off as much of the apple as you want, on your terms, and evolve to where the future is.  Don’t get caught believing this is an event, a utility, or a quick fix.  As an industry we are in for a long-term evolution into the 21st century of technology based on new and different ways of accomplishing the same task, just much faster, better, and cheaper.