The Federal Housing Administration announced last week that it will begin accepting electronic signatures on mortgage documents as part of an effort to streamline operations at the agency and reduce submission timeframes for borrowings seeking to avoid foreclosure.
“By extending our acceptance of electronic signatures on the majority of single family documents, we are bringing our requirements into alignment with common industry practices,” FHA Commissioner Carol Galante said. “This extension will not only make it easier for lenders to work with FHA, it also allows for greater efficiency in the home-buying and loss mitigation process.”
The new policy allows e-signatures on origination, servicing and loss mitigation claims. FHA insurance claims, REO sales contracts and related addenda are also permitted to be submitted with e-signatures.
Under the FHA’s current policy, only third party documents such as sales contracts and other documents not controlled by the lender are allowed to be submitted with e-signatures.
E-signature transaction manager DocuSign, which helped craft the policy, said the move is “a great step forward for brokers, agents, lenders and their clients.”
“DocuSign is pleased to have helped shape this progressive legislation on behalf of our customers and partners,” DocuSign Chief Legal Officer Ken Moyle said. “As the real estate industry standard for eSignature, DocuSign helps mortgage companies comply with all FHA eSignature requirements.”