In a move that might seem antithetical to its mission of helping mortgage lenders achieve a fully digital mortgage process, DocMagic, a provider of mortgage loan document preparation, regulatory compliance and e-mortgage services, has opened a 12,000 square-foot print fulfillment center just minutes from its headquarters in Torrance, Calif.
DocMagic says it opened the high-tech “supercenter” to support lenders’ growing need for secure, compliant paper documents as the mortgage industry transitions to a 100% digital mortgage process.
Although DocMagic and other doc providers have become major advocates of achieving a 100% paperless end-to-end e-mortgage process for lenders, it is expected that paper will be involved for quite some time to come.
That’s mostly because there is still a need for paper documents to be sent to borrowers if the borrower does not respond to repeated e-sign requests. For compliance reasons, docs must be printed and mailed within the required time frame, or the lender risks possible fines.
In addition, some borrowers just don’t want to move through a paperless origination and closing process.
“Ironically, DocMagic’s increasing need to produce paper documents results from the growing number of lenders using our technologies to transact paperless mortgages,” says Dominic Iannitti, president and CEO of DocMagic, who explained that even lenders employing 100% digital processes need to produce paper documents due to paper “fallout.”
“Simply creating a print fulfillment center wouldn’t have been an adequate solution because high risk is inherent in handling paper fallout,” Iannitti says in a release. “We needed a fulfillment center based on technology that eclipses any process – manual or automated – currently being used to process paper documents.
“Fortunately, this is where DocMagic excels,” he adds. “We created a fulfillment super center that operates at the height of automation in the mortgage equivalent of a sterile environment. We’re very proud of what we’ve built.”
However, just because there is paper involved does not mean advanced technology and automation are left out of the picture.
The new fulfillment center uses biometric authentication and video monitoring to provide auditable assurance that only authorized individuals access the building and specific areas within the structure.
Inside, advanced technology automates nearly every step of the paper process. Once the documents are ordered, a printer automatically feeds the paper documents directly into an automated system that scans and reads the bar codes to assure that all documents are present.
The documents are then inserted into envelopes, sealed and stamped – all without human intervention. The system logs and stores all actions, so lenders can review them and produce detailed information about any document’s activity, at any time. The result of this high-tech process for handling paper is a drastic reduction in the risk of errors, omissions and compromised data.
“UETA [Uniform Electronic Transactions Act] requires that consumers be allowed to opt out of electronic processes at any time, but that’s just one compliance issue lenders need to address,” says Iannitti. “The key difference between DocMagic and a basic software provider is DocMagic’s core focus on providing a legal and compliant process. Unlike other providers, we’ve automated and integrated that opt-out option within our workflow so lenders can avert risks that arise when transitioning to another system or vendor.”
DocMagic says it plans to open additional regional print centers across the U.S. over the next several years to support its expansion into other types of consumer loan programs.
Although there will always be some degree of fallout, as borrowers embrace the e-signing of all documents as the new norm, opting out to a paper process will become less common, as well as the need to support additional fulfillment centers.