In less than a decade, electronic recording of land-record documents will be commonplace in the mortgage lending business, predicted a panelist at March's MBA technology conference.
Speaking at a session on the practical value of e-mortgages, John Frey, clerk of the Circuit Court for Fairfax County, Virginia, said his office is already seeing benefits from being able to transmit lien releases electronically. That capability came through a joint pilot effort by his office in concert with digital document provider Ingeo and the nation's largest CU, Navy Federal.
Serving one of the most active real estate markets in the country, Frey's office records between 250,000 and 300,000 documents a year, 25% of which are certificates of satisfaction.
Hundreds of Docs Submitted
The first electronic document recording in Fairfax County took place in September, 2001, Frey said, and the system was officially turned on in January 2002.
Since then hundreds of documents have been submitted electronically to Fairfax County's Circuit Court Clerk's Office.
The system already has demonstrated the ability to reduce manual indexing-and indexing errors-by Clerk's Office staff, Frey stated. He said the system enables returning a recorded document to the mortgage company on the same day it is recorded, as opposed to the current turnaround time of six to eight weeks for processing and return via mail.
Navy Federal CU Branch Manager Susan Kihl said the electronic recording system improves processes by eliminating rejected items, speeding processing, eliminating the need to track outstanding items and ending the need to prepare and send FedEx packages.
Ingeo's Electronic Recording System is a suite of software and services automating the paperless creation, authorization, validation, and distribution of digital real estate documents.
Navy Federal project manager Johnna Cooper confirmed that installation of the Ingeo system is simple. Once the Ingeo project team confirmed that Navy Federal workstations had the correct browser, Ingeo quickly installed digital certificates on employees' machines. "Training took one day," said Cooper.
Navy Fed At Nearly 500 E-Lien Releases
So far, she said, Navy Federal has made 450 electronic lien releases in Fairfax County and another 30 in Orange County, Calif.
The ability to do that has already enabled some little miracles. For instance, she recalled, the attorney for a CU member refinancing her mortgage realized at the settlement that he had not yet contacted Navy Federal for a payoff. "The attorney was under the impression that they would have to reschedule the closing," she said. Instead, they were able to get an electronic proof of payoff from a Navy Federal branch office and proceed with the closing.
Navy Federal sells approximately 82% of its mortgage loans in the secondary market.
However, NFCU services more than 90,000 first mortgage loans totaling more than $10.3 billion and an additional $1.5 billion in equity loans.
