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Digital Closing Allows Homebuyers to Sign "Virtual" Stack of Documents

Amid pandemic fears, eClosing reduces human interaction during mortgage process

By Megan Ryan | June 2, 2020

Hand signing digital document on an iPad

If you’ve been through a house closing, you know what it looks like: mortgage lenders, real estate agents, title company reps and homebuyers sitting around a conference room table, with the happy new owners signing their way through a huge stack of documents guaranteed to produce a serious hand cramp.

The coronavirus pandemic is propelling technological advances for companies of all shapes and sizes, and the mortgage industry is no exception.

As home owners and potential buyers consider their options at a time of low mortgage rates, they may hesitate when considering how to complete the process while respecting social distancing and instructions to stay home.

In an industry that still heavily relies on paper, BOK Financial Mortgage is quickly adapting its closing procedures to allow much of the process to be completed remotely – and to help with that hand cramp.

Call it eClosing, short for electronic closing.

“We have been developing an eClosing process even before threats of the pandemic were in the picture,” said Marcus Humphrey, director of core technology and product strategy at BOK Financial Mortgage. “This is a direction the mortgage industry has been headed, but coronavirus has helped make the hybrid virtual closing a reality for us.”

As some county recording offices are closed, or operating solely through remote employees with varying levels of access to online records, mortgage lenders are adapting to meet changing client needs.

BOK Financial Mortgage has used electronic review and signatures for years. Loan officers expedite estimates and disclosures, for example, through an online system that clients access using a digital account. Humphrey noted that nearly 90 percent of clients choose the digital review process.

Now, using a hybrid eClosing process, loan officers can use the same process to send the entire closing package to clients for review prior to the closing date. Clients will be able to review what used to be an inches-deep pile of paperwork—online.

When closing day arrives, the majority of documents will open with access for clients to sign electronically. Using the hybrid approach, the loan note and a few other notarized documents still require a “wet signature” where the client physically signs the document with a pen.

The only people required to attend the closing in person are the client and the title company representative to notarize the wet signatures.

“For now, buyers and refinance clients will still visit the title company’s closing table, but it will likely only take 10-15 minutes rather than an hour,” Humphrey said. “In today’s environment, people are trying to limit their interaction with others and this hybrid eClosing process cuts down that exposure dramatically.”

“The hybrid eClosing process is an option for about 75 percent of our customers depending on the mortgage product selected,” Humphrey said. “We’re proud to be able to offer this alternative to keep our clients safe as we navigate the foreseeable future with a continued emphasis on social distancing.”

To encourage clients to limit in-person interaction, BOK Financial Mortgage will waive fees related to the hybrid eClosing option at this time.

Next up: an entirely remote process where a notary can witness clients’ wet signatures via webcam. Humphrey hopes to launch that option soon.