After two years of work, including user testing, private beta and public beta, in April the first ever digitally signed mortgage deed was registered at HM Land Registry – and a building society holds the mortgage.
Coventry have been working closely with the Land Registry and Enact Conveyancing to bring the Digital Mortgage Service to market. Fingers crossed this is the first step towards bringing slicker digital systems into the world of conveyancing, which continues to rely heavily on paper, pen and even fax.
In the Government press release Peter Frost, Chief Operating Officer at Coventry Building Society said:
"We’re delighted to have worked with HM Land Registry and Enact Conveyancing on this industry leading initiative to speed up property transactions. Initial feedback has been very positive, with customers finding the process simple, quick and secure. Although this initiative has started with re-mortgages we’re excited about the potential for it to be extended to purchases in the future."
Having seen the technology trialled, the BSA see it as a vast improvement on the status quo. The service uses GOV.UK Verify to make sure the customer is who they say they are by asking questions about personal data such as that held by credit reference agencies, the Passport Office or DVLA. Increasingly building society members will be using this technology in other areas of their life: to check their tax records or apply for a driving licence whenever it suits them. The question, undoubtedly, will be why aren't lenders keeping up?
In our view, this system of identity assurance has to be more secure than traditional witnessing. While we often have a yearning to stick to what we know, the fact is that forgery is rife when it comes to wet signatures. Lenders should also take peace of mind from the Land Registry backing the Digital Mortgage Service with the state guarantee, from the time of signing.
We know some building societies are already talking to the Land Registry about adopting the technology when the service opens up more widely later this year. Essentially all the Land Registry team need is a copy of your mortgage deed, which will then be turned into a digital format and shared with conveyancers. The bigger step for societies' risk teams may be in getting comfortable with accepting digital signatures on a deed. As such, the BSA will be doing more work to help members in this area.
While the Digital Mortgage Service has begun with re-mortgages, there is an intention on the Land Registry's part to extend this to house purchases as soon as possible. As digitisation takes hold in other parts of the mortgage chain such as broker portals and processing, we would encourage societies to consider seriously how this technology plays into your vision of future mortgage business.
Originally published as part of Mortgage Matters - to receive Mortgage Matters please amend your preferences.