eClosings Fact Sheet

Describes how eClosings facilitate a better quality mortgage closing process for both lenders and consumers while efficiently moving the housing finance industry forward through automation.

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What is an eClosing?

An eClosing is the electronic execution of some or all mortgage loan closing documents in a secure digital environment. eClosings allow for a more efficient and streamlined closing experience for borrowers, lenders, and third parties.

How Does an eClosing Work?

eClosings can be a hybrid paper and electronic process. Key documents such as the promissory note and security instrument can be printed to paper and wet-signed, while other documents are signed electronically (see eMortgage Fact Sheet). eClosings result in eMortgages only if the promissory note is signed electronically.

Benefits of an eClosing

  • Competitive edge: Lenders with eClosing capabilities can offer a more efficient closing process.
  • Experience: All parties involved in an eClosing (e.g., borrowers, originators, lenders, servicers, title and real estate agents) benefit from a more streamlined closing experience and shorter funding wait times.
  • Risk management: eClosings can reduce the potential for manual operational errors, such as missing signatures or documents, and it improves data quality and validation.
  • Costs: Electronic documents are typically less expensive to manage and administer than traditional paper documents and eClosings eliminate associated shipping, copying, and storage fees.
  • Post-closing processes: eClosings can offer faster turn times in warehouse inventory and liquidity into the secondary market.

Features and Considerations

Do Fannie Mae lenders need approval to do eClosings?

  • The Fannie Mae Selling Guide permits electronic signatures on most closing documents without specific approval; however, lenders looking to originate, sell and service eNotes, must first receive Fannie Mae approval. Contact your Relationship Manager for more information.
  • To learn more about how your business can implement eMortgages and eClosings, visit the eClosings and eMortgages page.