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Priming the E-Mortgage Pump With Free Electronic 1003s By Anthony Garritano Why do e-mortgages have to be hard? While the industry waits with baited breadth to hear about the return on investment numbers from various lenders now launching e-mortgage pilots, others are looking to speed things up by offering financial incentives to brokers and by adopting e-disclosures. For one, Encomia, Houston, is offering e-disclosures, along with a free e-signed 1003. This tactic was designed to speed up the residential mortgage loan application process by enabling borrowers to review and sign their upfront disclosures and loan applications online. Specifically, Encomia's e-disclosures enable brokers and lenders to create an electronic loan document package in their loan origination system and post it online for signing in SMART Doc format. Users will save time and money by eliminating considerable amounts of paper and overnight shipping costs, according to Encomia. Also, the company will provide the 1003 service to mortgage brokers and bankers at no cost, enabling both to try it risk-free. The e-1003 is available to borrowers online so they can fill it out, click sign and get locked into a given loan electronically. Users can upgrade to electronic disclosure delivery for a per-application transaction fee. This new technology was designed to make the lending process easier for borrowers as well and create lender and broker loyalty. It works in such a way that a link to the application and disclosures is sent to borrowers by e-mail, allowing them to review and sign the documents when convenient. There are also compliance benefits. Brokers and lenders can verify the borrowers' completion of the documents online to ensure disclosures are viewed within the mandatory three-day window. The proven and secure process includes borrower identity verification and secure delivery. "This was an exciting product move for us," noted Encomia's chief operating officer Andrew Krieger. "This is the first stage toward e-mortgage adoption. You want to begin by completing the upfront part electronic without having to adjust the LOS and other systems. "It's a killer app for borrowers. It is a differentiator for lenders too. The heavy lifting for us was with the e-vault technology. Now we're defining the adoption path to total e-mortgages with this move on the front of the process. In deciding to offer e-1003 free and move into e-disclosures, we wanted to understand a logical lender's approach to converting the business to an electronic one. This is a way to get people with little resources and technology focus in the game. This is a turnkey setup. This application was built for a lender of any technical resources and know how." But, why is he offering the 1003 free to users? "Part of our strategy is to drive e-mortgage adoption," answered Mr. Krieger. "This is a hook to get people to start doing this. We'll feed the market. We want to see this happen. The online 1003 is free and the e-disclosure is a transaction fee. We'll stay below existing cost to get the industry on the road with little to no process changes required."

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