Making Electronic Mortgage Closings (eClosings) the Norm

Our Finside Chats guest this week is Jack O’Donohue. A seasoned real estate attorney, Jack launched Touchstone Closing in 2016 and has grown the business to more than 50 team members across several New England locations. Jack hosts Touchstone Showcase, a weekly podcast featuring local and national real estate and lending topics.

Jack’s expertise does not end with real estate law, however. He is also a recognized donut aficionado; his YouTube channel, The Donut Digest, is the go-to source for bakery reviews across New England. This is just one more reason we wanted to talk to him!

Listen now: Fintech, Attorney States and Donuts with Jack O'Donohue, Touchstone Closing

No time to be afraid

As we spoke about Jack’s background, the subject of TRID came up. By its full name, TILA-RESPA Integrated Disclosure, TRID was a set of regulations that took effect in 2015. Its purpose was to integrate and align the Real Estate Settlement Procedures Act (RESPA) and Truth in Lending Act (TILA) disclosures and regulations.

At the time TRID was seen as a disruption to “the way we’ve always done things” for brokers and lenders. Jack noted that we’re at a similar inflection point now with the digitization of the lending process. Many see it as a threat. He sees it as an opportunity. “I just think this is about providing the best possible consumer experience,” he says, “and the folks that are scared, that's the 95%, they are sort of burying their heads in the sand.” He warns those organizations will be left behind if they don’t adapt to changing technology and consumer expectations.

He also reminds us that the core of digitization process is not new technology. It’s been around for a generation. “E-signatures have been a solution since 2000,” he describes. “We've been fielding the question my entire career: Why can’t we do this electronically? And you know, frankly, I'm tired of it. And I just can't wait until we can finally say that, yes, we can offer this fully electronically.”

Be ready or be a dinosaur

The transition to fully digital mortgages relies heavily on changes in state regulations. Jack describes this effort to make it legal as being in the seventh or eighth inning of the game. “For whatever reason, federal legislation hasn’t solved the problem,” he explains. “So we're going state by state here, hand to hand combat. And at the end of the game, we're going to just reset my industry, which is historically, dinosaurs. People who've done things a certain way their entire career. Pen and paper. And everything is just incredibly antiquated. And that's not how I am. That's not how I roll. I can't help but think that once it's legal, [innovators like us are] going to be all set, because we're going to have the leadership and the team that's ready for this. And then there's going to be a whole bunch of people that are completely screwed.”

The savings are obvious

We’re proud to say that Touchstone is a Stavvy client. We were curious how the use of remote online notarization (RON) is going and how it’s affecting users.

“We're taking advantage of the fact that a pretty good percentage of our business is in New Hampshire [where RON is authorized],” Jack explains. “So we're trying to roll this out and educate our team, and also just making the broader real estate community aware of it.” He believes it’s saving hundreds of dollars per closing, and is certain of other benefits. “We're saving people drive time. We're saving the QC part of it. We're really solving all the chain of custody issues with the documents and the signatures. So it's just providing that better experience for the customer in New Hampshire.”

Jack sees these benefits as worth fighting for. “If it was up to me, I would get on the phone with every single person in New Hampshire that we work with and pretty much demand that they go about it this way and handle the closing this way. Because that's where the future is. And it's just a matter of understanding that that old ceremonial closing with 10 people in the room […] that's over,” he concludes.

“It's going to be interesting to see what transpires and how quickly. I do think that to one degree, the pandemic has really accelerated the adoption rate just because of all the issues that have been associated therewith.”
- Jack O’Donohue

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