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18 | Th e M Rep o RT Feature much paperwork, 2) not enough time to review the documents, and 3) documents that are too technical. After the eClosing pilot program was announced, CFPB Director Richard Cordray said consumers are faced with an overwhelming stack of papers at closing. "Indeed, it is counterproductive insofar as it causes consumers to zone out and sign documents without properly evaluating and understanding criti- cal information about the largest financial transaction of their lives," he said. Mountain America was one of 12 creditors and vendors chosen for the CFPB pilot program. By partner- ing with Pavaso, Inc., a technology company in the real estate clos- ing industry, and using their own QuickClose platform, Mountain America securely managed docu- ment and data transfers, viewed and processed documents, facilitated electronic signatures, created a clear audit trail for the transaction, and sanitized data for analysis. In the pilot program, Mountain America and other lenders were also able to test the adaptability of their eLending platforms. When Mountain America first imple- mented its system, it built in a 24-hour review period. This gave the borrower a full day to review the closing documents, but the up- coming "Know Before You Owe" changes call for a 72-hour window. Mountain America adapted to this change by adjusting the eLend- ing workflow to include a longer review period. The eLending platform gave the company the flexibility to adapt on-the-fly. "By having an eLending solution," Turner said, "we were able to speed up loan closings, reduce paperwork, and improve customer service, all while preparing for the CFPB's clos- ing disclosure changes." Jumping in with Both Feet S witching to an eLend- ing platform can be extreme- ly advantageous for lenders, but it also can be a demanding process to implement. Lenders should keep in mind the fol- lowing: 1. Do it for the right reason(s). Switching to an eLending plat- form requires the right mindset. You have to want to do it. Improved customer service, cost savings, an optimized workflow, improved security, or a combination of these things are among the benefits lend- ers incur, but whatever your reason for becoming an eLender, make sure to keep that reason in mind at all times. It will help you stay moti- vated and help you power through any rough patches. 2. Get everyone on board. One of the most important requirements is organizational support. You need 100 percent buy-in from the top down. Gain the support of your president and/ or CEO. Once the initiative has his or her backing, you can start building support among other staff members. 3. Implement the right technology. In order to process eLoans, you'll need a digital platform. Compare various options to find the one that best meets your needs. The idea is to invest in products that can help move you to a fully integrated online pro- cess. Consider the various phases and how to alleviate manual efforts in your workflow (e.g., utilization of bar code technology and secure, unique identifiers for each loan applicant). You also will want to partner with the appro- priate vendors. Title companies, investors, and others may need to implement technology that is compatible with yours. 4. Remap your workflow. Analyze your workflow, and make necessary changes. You'll need to make sure there is a process to check the data between every handoff. Remember, the stack of documents will still exist, but it will be files separated into electronic folders—rather than a physical stack of papers. To make the transition smoother, you may want to focus on one area first. For example, you could start with eClosings and then work backward to originations. 5. Give yourself time. You can't go from paper to pa- perless overnight. The steps above take time and resources. Most importantly, you'll want to allow adequate time for testing. This way the transition is as seamless as possible for borrowers. In an ever-changing industry, lenders are having to constantly adapt to new regulations and innovative technologies. With a new wave of regulations already forcing lenders to alter their pro- cesses, now may be the ideal time to take the leap into eLending. Closing Complaints The CFPB RePoRTs Common Pain PoinTs in The Loan CLosing PRoCess Before launching its eClosing pilot program in 2015, the CFpB released a report on the pain points for borrowers and lenders during the mortgage closing process. Below are the annoyances most highlighted in the study: 1 Slow Document Delivery: The CFpB concluded 31 percent of surveyed consumers, 51 percent of notaries, and 58 percent of settlement agents cited this as a challenge. 2 Errors in Documents: Document errors are the fourth-most cited problem in the CFpB study. Forty-two percent of notaries— who are a key part of the compliance part of the lending cycle—cited document errors as a problem. 3 Complex and Difficult-to- understand Documents: 38 percent of consumers surveyed by the CFpB cited confusing documents as a problem. Most said they did not read the documents before signing them. 4 Lack of Standardization: Lenders fear there is no standard format to follow to ensure full compliance with all state, federal, and local lending laws. 5 Legal Risk: Lenders fear legal issues if the loan documents are not all- encompassing, exposing them to litigation. This in turn causes them to add more legal jargon to the mortgage documents. AMy MoSER is VP of Mortgage Services at Mountain America Credit Union, one of the largest credit unions in Utah. With more than 18 years' credit union experience, Moser has extensive lending experience from loan origination through servicing. This knowledge has been instrumental as she successfully leads a high-tech, high-touch mortgage department to deliver top-notch service with both accuracy and speed. "[having a stack of papers at closing] is counterproductive insofar as it causes consumers to zone out and sign documents without properly evaluating and understanding critical information about the largest financial transaction of their lives." — Richard Cordray, CFPB Director WW-M-Report-022015.indd

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