The Federal Housing Administration (FHA) recently confirmed that it will accept electronic signatures on third party documents included in the case binder for mortgage insurance endorsement in accordance with ESIGN and UETA. Third party documents are those that are originated and signed outside of the mortgagee’s control, such as a sales contract. The FHA was careful to point out that “Mortgagees must employ the same level of care and due diligence with electronically signed documents that they would for paper documents with ‘wet’ or ink signatures.” With the growing prevalence of identity theft, that level of care includes verifying the identity of all document signers. This can be more challenging when the borrower is in a different location and not visible to the lender.
For some time now, eLynx has offered Knowledge-Based Authentication (KBA) for electronic signatures and transactions. The solution enables lenders and financial institutions to authenticate borrowers and customers for high value electronic transactions. The KBA option adds another layer of security to online transactions, such as electronic signing of loans, for optimal loan fulfillment process. Recently, the company updated its procedure to give borrowers a second chance to succeed before locking them out of the application.
For more information, visit www.elynx.com.