The lender-title relationship is one of the most fundamental partnerships in real estate transactions. Without effective communication and collaboration between these partners during the closing process, delays can quickly compound, creating a poor experience for homebuyers. 

As homebuyer expectations for a streamlined, end-to-end transaction experience increase, it’s more important than ever for lenders to operate synchronistically with their title & escrow partners. 

Effective lender-title collaboration is only possible with technology that allows for integrated operations. By leveraging secure, cloud-based technology and automation, lenders can not only work more efficiently with title & escrow businesses, but also create an optimal transaction experience for their customers. 

Are end-to-end transaction experiences the future?

It’s widely known that today’s consumer expects a streamlined, digitally-enabled transaction experience no matter the type of purchase—and real estate is no exception. 

Within the past few years, efforts to improve real estate transactions and create a fluid start-to-finish purchase experience have accelerated. Recently, Qualia’s CEO spoke about this industry shift in an interview with Inman. “The experience of really having an all-in-one easy, manageable transaction that happens in one place, which is straightforward—that’s the direction [the industry] going,” he said.    

Historically, homebuyers have undergone a fragmented, often disjointed experience as they work with lenders, real estate agents, and title & escrow businesses to find, finance and then finally close on their homes. Now businesses are considering ways to improve this experience with varying strategies:

  1. New iBuyer businesses and real estate brokerages are building full-service ecosystems to own and manage the complete transaction experience
  2. Title & escrow companies and lenders are increasingly looking for opportunities to vertically integrate their entire operations for improved margins and a more consistent consumer experience
  3. Stakeholder businesses (lenders, title & escrow, real estate brokerages, etc.) are using advanced, cloud-based technology to better integrate with one another for a “simulated” end-to-end experience. In other words, on the back-end these companies operate separately, but on the front-end, the homebuyer experience is equally fluid as an end-to-end platform.

For lenders looking to maintain a competitive edge and deliver an improved homebuyer experience, working with partners to create an end-to-end experience (strategy 3 above) is often the best route forward. Historically, this was challenging due to technology limitations. 

Why has collaboration between lenders and title & escrow companies been so challenging?

Traditionally, a shared platform has not existed for real estate transactions. In other words, lenders work siloed within their software systems and title & escrow businesses work siloed within their software systems to complete real estate transactions. These systems are often on-premise, server-based software that present a host of security issues and compatibility issues. In other words, these systems don’t always “talk” to each other.

This translates to inefficient document processing and sharing and duplicate data entry across systems. Lenders “chase down” documents from title & escrow agents and use many different methods of sending and receiving documents to and from title & escrow businesses such as email, fax, and mailing physical documents. This leads to delays in the closing process and security issues—both of which result in a less-than-ideal experience for a homebuyer. 

Additionally, the vast majority of the time, lenders do not select the title company they work with. Instead, the title company is selected by the real estate agent. This further fragments the process because the lender is unable to create a systematic process and ideal closing experience with a consistently selected pool of title companies.

How lenders and title & escrow companies can collaborate with secure technology

Today, technology exists to integrate title and lender operations and create a more streamlined transaction experience. Qualia is working on many such innovations to bring lenders and title & escrow businesses together on a single system of record and ultimately create an improved homebuyer experience. 

Secure customer communication portals 

During the closing process, a homebuyer may receive a number of emails and phone call information requests from their lender or title agent throughout the transaction. Lenders and title & escrow businesses can better collaborate during this process by offering a single, secure space for homebuyers to submit documents, ask questions, and connect with their closing team handling each part of the closing process. Qualia Connect is one such portal that offers mortgage professionals, title companies, and borrowers a secure space to direct questions to any of the transaction stakeholders, access documents, and gain 24/7 visibility into the progress of a closing in real-time. 

Loan origination system (LOS) integrations

Technology integrations enable lenders to link their loan origination system (LOS) with title & escrow software. For example, title & escrow companies on Qualia’s software integrate seamlessly with lenders on Encompass through a two-way integration (2WI) that allows lenders to automate title ordering, communicate securely with title companies, and collaborate via seamless document sharing and progress updates. Qualia’s Encompass integration also includes a Fee Collaboration enhancement that enables lenders to automatically and accurately match fees across their files with title & escrow businesses. 

Digital closing technology 

Hybrid eClosings and remote online notary (RON) eClosings are creating a better experience for homebuyers and enabling further efficiencies between lenders and title & escrow companies. In an electronic signing environment, the possibility of a missed signature is greatly reduced which results in lowered audit costs and reduced disbursement delays for lenders. Additionally, funding on a transaction is greatly expedited. At the Kentucky Land Title Association (KYLTA) Annual Convention, Qualia’s Director of Partnerships, Max Lamb, spoke alongside Mike Lyon, Executive Vice President of Nexsys who explained the financial benefits of eClosings for lenders. “Typical funding on a transaction takes an efficient lender between 9 and 12 days after closing,” Lyon said. “In an efunded process, funding can happen nearly immediately.” 

Post-closing automation

Streamlining the entire transaction extends into the post-closing process. A more efficient post-closing can result in increased margins that directly empower a lender’s ability to service consumers more effectively. 

Historically and presently, the post-closing process is rife with delays. Lenders must follow up with title companies after closing documents are recorded by the county to retrieve trailing documents. This process often requires lenders to conduct many follow ups (meanwhile title processors have since moved on to fulfill the next set of orders). The resulting delays cost lenders valuable time and resources. 

Technology to automate and expedite the post-closing process is greatly improving lender-title partnerships. Products such as Qualia Post automate the collection of trailing documents, freeing up post-closers to focus on other critical parts of their job and improving margins so lenders can focus more resources and energy on customer experience. 

Discovering technology solutions that enable collaboration between lenders and title & escrow businesses is paramount to maintaining a competitive edge in today’s environment. Consumers are increasingly expecting end-to-end transaction experiences, and businesses that deliver will come out ahead.

To learn more about how Qualia is helping lenders better collaborate with title & escrow companies, click below to schedule a demo.

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