Reverse mortgage subservicer Celink announced this week the new availability of an option for reverse mortgage borrowers to sign their annual occupancy checks online. Celink says that the online options comes with added security when compared with the traditional mail-based process, and complies with all relevant existing regulations.
The launch of this new feature comes nearly a year after the initial launch of Celink’s new online borrower portal, and just after it was announced that Celink has been awarded the Home Equity Conversion Mortgage (HECM) servicing contract by the U.S. Department of Housing and Urban Development (HUD).
To get a better idea of what a digital e-sign option might mean for existing reverse mortgage borrowers, RMD reached out to Celink and was provided with answers by a group of the company’s employees including Chief Client and Industry Relations Officer Ryan LaRose, Chief Information Officer Sergey Dyakin and SVP of Client Satisfaction Gail Balettie.
Development and potential borrower impact
The feature has been in development for some time now, Celink explained, in a timeline that conforms with the initial launch of the online portal.
“We began laying the groundwork for the implementation of eSign and designing the actual feature in the first half of 2021,” the representatives explain. “We initiated the development phase in December 2021 and it was completed in February 2022.”
The potential to greatly expand the ease of use and engagement with a necessary reverse mortgage loan obligation should help to make a difference for borrowers,
“E-sign greatly simplifies the effort required by our borrowers to fulfill their Annual Occupancy Certification obligation,” the group says. “They don’t have to look for the form in the mail once a year, sign it, and return the paper (and wait the 3-7 days for the postal service to deliver it). They can now certify their occupancy of the property with just a few clicks, securely online.”
The group goes on to detail that borrowers will receive email reminders about when it’s time to submit their occupancy certificate and once they log into the Celink portal website, a banner appears on the landing page informing them of the electronic submission option.
Many Americans are simply more accustomed now to doing their financial business online, and the development of this feature in the reverse mortgage arena was a natural step. This is according to Marion McDougall, Celink’s CEO.
“Many senior borrowers are used to the convenience of managing their financial accounts online. We have built the portal to deliver real-time access to important information about their loans,” McDougall said. “With the portal, we also improved the security of communication. Our technology investments aim to improve borrowers’ lives and increase their satisfaction.”
Regulation, additional features being explored
One of the things that certain reverse mortgage industry participants have said regarding their willingness and ability to offer additional services online is that a series of legal requirements keep them from doing so. With this feature, however, Celink is in compliance with prevailing regulations and guidance that has come down from the U.S. Department of Housing and Urban Development (HUD), according to the group of employees that responded to RMD’s inquiries.
“Celink developed this feature in compliance with the Electronic Signatures in Global and National Commerce Act (E-Sign Act) and HUD’s Mortgagee Letter 2014-03,” the group explains. “In addition, we proactively notified HUD’s National Servicing Center, outlining the process and providing a sample of the form that will be included in future HUD Assignment packages for those loans where a borrower opted to certify their occupancy electronically.”
ML 2014-03 was issued in January, 2014 in an effort to “modernize” the agency’s processes, according to statements from the Federal Housing Administration (FHA) at the time. Through the letter, FHA granted lenders the authority to accept more mortgage documents containing electronic signatures rather than through physical documents signed in pen and ink.
That authority extended to e-signatures for origination, servicing and loss mitigation documents; in addition to FHA insurance claims, REP sales contracts and other related addenda, according to FHA. The move at the time was made in order to help the agency align with increasingly common lending practices, according to then-FHA Commissioner Carol Galante.
The E-Sign Act was passed by the U.S. Congress in June of 2000 and signed into law that month by President Bill Clinton, and helped to formally recognize e-signatures as a legitimate process in certain transactions.
When asked if Celink is planning to explore creating digital options for other reverse mortgage loan processes, the group alluded to the possibility in the future, but declined to detail what those processes might be.
“We believe that reverse borrowers are becoming more and more digitally savvy,” they said. “Our plan is to continue introducing new features that will provide an enhanced experience for our clients’ borrowers.”
New potential efficiencies for Celink, the industry
RMD also asked about what the company might like to see explored in the future.
“While not directly related to our Borrower Portal, Celink would like to see more application interface opportunities with HUD’s HERMIT system,” the group explains. “Creating the ability to interface electronically with HERMIT would greatly improve the effectiveness and quality of the work that we perform for our clients and HUD.”
The Home Equity Reverse Mortgage Information Technology (HERMIT) system was launched by the U.S. Department of Housing and Urban Development (HUD) in October of 2012 after a protracted development cycle. Its creation aimed to improve the processes associated with the endorsement of HECMs, as well as the processing of servicing and claims within HUD.
HERMIT was developed through a contract with Reverse Mortgage Solutions (RMS), which partnered with QSSI on creating a service provider platform. Reverse Technology Group (RTG) acquired the software in early 2017.
Developing additional digital processes will be a very necessary practice for the future of the reverse mortgage industry, Celink added.
“We believe it’s important to continue to develop our portal to provide borrowers with the option to manage their accounts securely online,” the group explains. “We have conducted borrower usability studies with actual reverse mortgage borrowers and the feedback has been overwhelmingly positive, with users finding the portal to be very user-friendly and easy to navigate. This direct interaction with borrowers enables us to better plan for future enhancements and customize the portal to the needs of our demographic. Overall, we are very pleased to be able to provide this new functionality for our clients’ borrowers.”