Many businesses are looking to expand digital closing offerings to meet changing consumer expectations in 2022. At the recent Digital Boot Camp hosted by ALTA, MBA, and MISMO, Qualia’s Director of Product Strategy, Title & Escrow, Angela Lozano, moderated a discussion on how mortgage lenders and title companies can work together to move forward eClosing adoption.
Panelists included Linda Grahovec, SVP, FNF National Agency Director of Education & Marketing Strategy, Rajasekhar Penugonda, Director of Product Development at Freddie Mac, and Brian Webster, Senior Vice President of Enterprise Solutions at Freedom Mortgage.
A variety of eClosing options
During the discussion, the panelists explored the full range of eClosings (see ALTA’s chart below) which all require different criteria to be met. The conversation remained high-level to account for the varying types of eClosing experiences which all involve different types of technology and levels of coordination.
Allow the consumer to choose their closing experience
Panelists agreed that working with partners to increase digital closing options (like those in the chart above) can offer clients additional flexibility and allow them to choose the closing experience that works best for them.
Buying a home is one of the biggest purchases many consumers will make in their lifetimes. Giving consumers the ability to choose how they’d like to close based on their comfort with technology and expectations around the closing process can improve the consumer experience. Webster noted that offering a variety of closing options from hybrid eClosing to full remote online notarization (RON) allows transaction teams to meet the needs of clients in unique circumstances. For example, if a homebuyer can’t be physically present for a closing due to vacation or illness, digital closings can allow the transaction to continue without skipping a beat.
Grahovec explained that while the industry is heading towards a more digital experience, many consumers still appreciate sitting down with a closing agent for expert guidance. Real estate is a significant investment for many consumers and can be an overwhelming process. In fact, our homebuyer sentiment survey found that homebuyers find the closing process to be the most stressful and complicated part of the real estate transaction. While a homebuyer might prefer that the closing take place in-person, technology can still be leveraged before the closing date to exchange information and give the homebuyer a greater sense of ease before the closing date.
Collaborate with experienced partners and vendors
It can be difficult to implement new technology and unfamiliar closing processes from scratch. Panelists explained that partnering with other real estate professionals who possess experience with digital closings can help accelerate technology adoption by making the process smoother. Additionally, by identifying high-quality vendors to perform various closing services, such as notary and title searches, businesses can increase digital closing options in a more scalable way.
Partner collaboration is especially important for conducting digital closings because each stakeholder has different eClosing requirements. For example, lenders need to meet the requirements of their investors and title agents need to meet the requirements of their title insurance underwriters. Grahovec encouraged both title companies and lenders to clearly define their policies and procedures with outside partners in order to effectively establish new closing processes. By understanding the various requirements of all stakeholders, businesses can work together to create closing experiences that work well for their transaction partners as well as consumers.
Create learning opportunities for internal teams and consumers
There will likely be a learning curve when adopting new technology and closing tools. This is why employee training is a key piece of the technology adoption puzzle. Panelists explained that internal training ensures that (1) closing agents are confident and comfortable with a wide variety of closing options and (2) that all employees follow the same process to ensure consistency.
Employee training also carries over into client interactions. Homebuyers look to real estate professionals for guidance and expertise during the closing process. By leading clients through closings, answering questions, and addressing any issues, real estate professionals can improve consumer experience and reduce confusion during the closing process.