Did You Know: A basic hybrid eClosing is easier than you think?

For many lenders used to a paper-based mortgage process, an electronic closing may feel out of reach. Why? “The county recorder won’t accept it.” “My investors won’t purchase it.” “I can’t change my processes.”

And of course, “It’s too difficult to implement.”

Except it isn’t.

While eNotes and eNotarization do require more time and effort, a basic eSign hybrid — in which borrowers can electronically sign all of the closing documents, with the exception of the note and recordable documents — is very simple to set up. Lenders who are already using DocMagic’s doc gen solution, in fact, can be enabled for eSign hybrids (also known as Hybrid #1) in as little as 24 hours. 

“As soon as you say ‘eClose,’ a lot of clients say, ‘We can't do that. We can't do an eNote. We can't do eNotary,’” said Aimee Eyre, a sales executive at DocMagic. “But eSign hybrids don’t require a big implementation.”

This type of hybrid closing allows borrowers to preview all of their documents ahead of the closing; switches the majority of documents from paper to digital; and reduces a prolonged, drawn-out ceremony to a matter of minutes. Crucially, it’s also accepted by every investor and county recorder in the country. The more complicated pieces of the closing, the note and deed, are still wet-ink signed and can undergo traditional in-person notarization.

During the pandemic, eSign hybrids shot up in popularity as many lenders set up a drive-thru closing system to allow for shorter and mostly socially distanced closings from the safety of a car.

For DocMagic’s doc gen customers, adding on eSign hybrid capability is easy; it can be set up within 24 hours and clients can begin testing it out with their teams and settlement agents. “It’s just a matter of a couple of clicks,” said Darlyn Buthsombat, a DocMagic account executive. “We’ve already done the work on the backend; we already know which forms are e-enabled and what type of eClosing it is.”

Additionally, lenders have plenty of flexibility with such hybrids, which can be implemented for specific investors, states or loan programs.

For a new customer, the onboarding time frame is closer to 30 to 90 days, depending on the size of the company and if they have special requests, as new lenders first need to be set up for processing documents.

For most lenders, there’s one main roadblock to implementing an eSign hybrid: “It’s an operational change. When I speak with a customer, that's their only resistance — it's just a big change to how they do things,” Buthsombat said.

“But there shouldn't be anything that's stopping lenders from doing this type of hybrid because it's really easy,” she continued. “It's a win-win situation for all parties: the lender, the selling agent and the borrower.”

DocMagic’s Sales Team can be reached at sales@docmagic.com.

Related Content:

• Did You Know: You can cut out the middleman and draw your own docs? (6/30/2021)
• Did You Know: You can get all your eClosing needs met by one vendor? (6/16/2021)
• Ask the eClosing Team: What steps should lenders take to get set up for eClosing? (6/2/2021)