Realtors® know first-hand that real estate closings are a complex process that’s often slow and confusing for their clients. Consumers want simplicity and transparency, and Realtors® say electronic closings have the potential to deliver on that demand, but widespread acceptance of so-called “e-closings” has yet to take hold.

National Association of Realtors® 2017 President-Elect Elizabeth Mendenhall convened a meeting of tech and industry leaders in Washington, D.C. with the goal of identifying and addressing some of the challenges to widespread e-closing implementation.

Among them, concerns remain about the legal ramifications of accepting electronically submitted signatures, notarization, and other elements of the transaction. But concerns over e-closings extend well beyond the closing documents consumers see at the closing table.

In a typical closing, the documents must be properly recorded and payments disbursed to the entities involved. Oftentimes the loan originator will also receive funding for a mortgage from a loan “warehouse,” and those funds may be repaid when the loan is eventually sold or securitized on the secondary mortgage market.

The result is a wide range of actors are involved in each transaction, often with their own varying technology platforms, making the transition from paper closings to e-closings fairly complex from both a communication and business standpoint.

Those challenges haven’t stopped various entities from trying, of course. The Consumer Financial Protection Bureau launched an e-closing pilot program in 2015 and found that consumers “are generally better off on measures of understanding, efficiency, and feeling empowered” than those who moved forward with a tradition paper closing.

The idea of an e-closing isn’t new. The issue took one of its first major steps forward with passage of the “E-SIGN Act of 2000,” a federal law establishing the legal equivalency of electronic signatures in commerce. Since then, a range of federal agencies have moved to implement policies that utilize e-signatures, most notably the Federal Housing Administration in 2010.

Acceptance with e-closings within the industry however is inconsistent, and in many areas is entirely unavailable. NAR and the broader real estate industry recognize the need for this to make e-closings more available.

Mendenhall said she sees hope for e-closings on the horizon and highlighted the value e-closings offer to both consumers and agents.

“We’re already seeing e-closings take place, but we need to see more of it,” Mendenhall said. “This is a business imperative for our members.”

Tweet this:

Properties in Franconia

5603 Franconia Rd #301

Conveniently located 2 bed condo ready to move in! Secure building entry, top floor unit w/balcony facing courtyard. Updated kitchen & bath. Bus stop across street, located close to Van Dorn (Blue) & Franconia (Blue) metro, 95, FFX Co Pkwy, & 395. Walk to the Kingstowne shopping, movies, & dining. Close to National Harbor and DC. Check out the dollhouse, visual tour attached! [Burberry Court - $229,999]

6644 Elk Park Ct

Just renovated 2 level town home, SS appliances beautiful new cabinets, granite countertops, ceramic tile floors, new wood floors New vanities and toilets; New carpet, Just painted, recently replaced windows, Ready to move in, Pool right out the back door, Fenced backyard & patio [Franconia Commons - $368,988]

6601 Thackwell Way #E

Fabulous, light filled, 2 bedrm, 2 bath condo w gorgeous sunroom*Built-in bookcases surround a cozy gas fireplace in the spacious living rm*Open kitchen w/ plenty of cabinets~ & counter space*Master bedrm w large walk-in closet & luxury bath*The convenience of a first-floor entrance w/ the security of 2nd level living*Meticulously maintained w neutral paint & carpet*In unit laundry*See video tour! [Carrdinal Place - $315,000]


Townhouse Residence in Vienna, VA . . .

$775,000 at Amberwood

Real Estate

Aubrey Nesbitt

View posts by Aubrey Nesbitt
Aubrey Nesbitt is a native of Northern Virginia who attended Virginia Commonwealth University. He is a veteran of the US Army and helps his family business by providing informational articles like this one. In addition to photography and blogging, Aubrey provides administrative support for the office.

Leave a Reply