Over here at Adobe EchoSign, we're really thrilled with the decision by the Federal Housing Administration (FHA) that it is granting "expanded" authority to lenders to accept eSignatures like EchoSign on documents associated with mortgage loans. The new approach allows e-Signatures on loan origination, servicing, and loss mitigation documents, as well as FHA insurance claims, real estate-owned (REO) sales contracts and related addenda. As you might know, the current FHA policy allows for electronic signatures only on third-party documents such as sales contracts and other documents not controlled by the lender.
Lenders choosing to employ e-signatures may begin using this policy immediately for single family forward mortgages and FHA’s reverse mortgage products, Home Equity Conversion Mortgages (HECM). Lenders are required to adhere to the Electronic Signatures in Global and National Commerce Act (ESIGN), have specific technology and operational capabilities and controls, documented quality control processes, and the ability to adapt e-Signature to FHA’s existing record retention processes.
The e-Signatures policy will help streamline the origination process and help reduce document submission timeframes for borrowers seeking options to avoid foreclosure. Initially, e-Signatures will not be accepted on the mortgage note itself. The FHA plans to begin accepting e-Signatures on forward mortgage notes at the end of the year. For more information, please check the FHA site here.
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