by Todd R. Hougaard
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Ten Questions to Ask When Considering an Electronic Recording Solution
1. Does the solution record fully digital SMART documents?
Some vendors - and even some counties - are using the term “electronic recording” to describe older systems that rely on scanned document images. Although these systems offer some process efficiencies, much greater benefits are achieved when recording with fully digital SMART documents, which incorporate digital signatures, digital notaries, electronic payments, and computer-friendly data that can be easily processed by automated recording systems.
2. Does the solution offer easy entry to electronic recording with flexibility for multiple transaction types?
Efficient electronic recording solutions will be flexible enough in architecture to allow development supporting multiple transaction needs. Open platform technology provides the flexibility to develop specific needs for each participant in the process.
3. Does the solution enable the paperless recording of privately submitted land records (B2G)?
The full benefits of electronic documents come from automating the processing of commonly submitted land records. Any useful solutions must satisfy the complicated requirements of the banking, finance and legal communities. Since this type of recording involves both public and private entities, a target solution should involve an end-to-end solution that fulfills the needs of the private document submitters as well as recording offices.
4. Has the solution been implemented in any recorder's office where I can actually go and see it in operation?
Some vendors are promising their customers electronic recording solutions that are just over the horizon or are “in beta”-meaning that they are still somewhere between the drawing board and actual installation. It takes substantial time to bring a software system to market, and some developers try to hold off the competition of characterizing the future products as “just about there.” Before you make a decision to buy a specific solution, you should be able to see it in action.
5. What national lenders and document submitters currently use the system?
Electronic recording systems aren't very useful unless national mortgage lenders and loan servicers have agreed to submit electronic documents. Many leading national mortgage lenders, loan servicers, and title companies are presently investing in technical solutions to allow them to prepare and submit SMART documents for recording. Maximum process efficiency comes when upgrades are made in both the public and private sectors.
6. Can the solution be easily integrated with my information management systems?
In today's interconnected work environments, no system is an island. An electronic recording solution will never be the only software system running in a particular installation. Since e-recording software always runs parallel to complementary systems, it should be designed specifically for integration with other data systems and vendor solutions.
7. Does the solution manage such complex issues as digital signing and notarization, electronic payments, and information security?
The old adage “It's what you don't know that will hurt you” is particularly relevant to electronic recording. Only a proven recording solution - one that has undergone rigorous long-term use in multiple installations - can guarantee that the numerous and complicated issues surrounding electronic document recording have been successfully addressed.
8. Does the solution comply with government and mortgage banking standards for digital transactions?
Significant efforts have been made over the last several years by representatives from the technical, legal, mortgage banking, and land records recording industries to agree on standards for creating and processing digital land records. The value of any solution is in its compliance with current standards and the speed at which it can become compliant with new standards as they emerge.
9. Is the system flexible enough to accommodate multiple recorders' unique business rules?
Each recording office has its own characteristic set of examination and validation rules. No recorder should be forced to change processes and practices to meet the needs of the out-of-the-box solution. Likewise, no recorder should have to pay the high price to develop a customized solution. The ideal electronic recording system should be flexible enough to be tailored to each recorder's individual needs and should be able to manage several recorders' rules through automation.
10. Will the solution enable me to continue recording digital documents over the next few years?
No one wants to invest in technology that will soon become obsolete. In addition to accommodating current recorder requirements, an electronic recording system needs to change and grow with the needs of the recording community. By employing cutting-edge technology, a system should demonstrate a strong sense of industry direction. Electronic document recording represents today's solution to tomorrow's challenges.
Todd R. Hougaard is president of Ingeo, a national leader in digital commerce founded in 1996. He can be reached at (435) 755-9837. In May of 2000 the company launched its Electronic Recording System, with two separate applications serving mortgage lenders, servicers and title companies, and recorders' offices. You can read some of Ingeo's case studies on county recorders implementing electronic recording at www.ingeo.com.