Paperless Mortgages Just Scored Two Big Wins in the US Court System


June 6, 2016

Thanks to two key decisions in US courts, electronic signatures and paperless mortgage documents may have just had their watershed moment.

As reported in the US publication National Mortgage News, two separate properties, one in New York and one in Florida, were being foreclosed upon, and in both cases, the loans were originated without paper. Both judges ruled that the electronic history was such that the Lenders had grounds to foreclose.

So why is this such a big moment for the Canadian Mortgage industry? Because it means that electronic notes and loans are legally valid down South, which creates a precedent. Lenders will be relieved to know that loan documents with e-signatures are legally binding, and the “way of the future” can finally become a part of our present. Perhaps not today, but soon. E-signatures have been legal on US mortgage documents since 2000, but adoption has been slow, in part due to fear.

The courts themselves have a lot to gain by blazing a trail in the electronic documents space. Massive amounts of paper and redundancies can be eliminated from the legal process when they embrace esignatures for themselves. This comes as no great surprise to us, of course; we have been building our product to eliminate paperwork until right up until the final mortgage documents are created. But with this news, it might not be long before Canadian mortgages can be issued without any paper at all.

“We see this is as great news,” says our CEO Alex Conconi. “Obviously we know e-signatures are destined to become the industry standard, but these high-profile court rulings will go a long way to appeasing the remaining sceptics.”

Lendesk will incorporate an integration with E-Sign Live by Vasco, a feature that will allow several steps in the origination process to be made paperless. Who knows, maybe before long, Canadian Loans will be paper-free from start to finish. You can bet that if they are, we’ll be at the forefront of making it happen.

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