The “Cyber-mortgage”

You can’t turn on the radio or TV these days without hearing the advertisements for “the first totally online mortgage” or websites that help you troll the listings online to find your new home.  At the same time, you can’t turn around without hearing about hostile nations hacking into all sorts of sensitive government systems & stealing the fingerprints and personal information of millions of people.

I know I’m dating myself here, but remember that old movie Terminator 2:  Judgment Day?  There’s a scene where the original Terminator (Arnold) is trying to save Linda Hamilton from the liquid metal Terminator that just took out all the employees at the mental hospital.  Arnold says, “Come with me if you want to live”.  Her response is priceless, of course because all she remembers is how he tried to kill her a million different ways in the first movie.  Well, every time I hear someone saying how great the cyber-mortgage & eclosings are, my face does this thing that mimics her reaction to the idea of going with the Terminator.  She obviously missed the memo of how the machine sent to kill her has turned into her white knight.  I know how she feels.

It seems like there is a pink elephant in the room with all the “hip, hip, hooray” about everything going online – including home buying process that has previously been compared to a spinal tab due to the amount of information we have to pony up.  I’m all for improving service to the client and making processes easier for everyone involved, but are we really ready for this?  I can’t help but wonder, with all the cyber attacks that businesses face and all the data breaches at the highest level of our government, who is this online mortgage really benefitting?

Age-wise, I fall right between the baby-boomers and the millennials.  So I grew up with color TV, but a cell phone was the size of a briefcase when I was a kid, and “gaming” was family Monopoly night, since the Atari had just hit the scene.   So I understand how technology can benefit us all, but I can’t help but wonder if we are putting the chicken before the egg.  Are we doing enough to protect people from all the cyber-threats out there?  If the Pentagon can get hacked, it is reasonable to expect that the personal information I shared to get my loan won’t make it into the hands of some terrorist or a teenager that wants to hack into my Netflix account?  I don’t think so.

Plus, what about all the questions I may have about the process?  Is it “fair lending” to push people of my parent’s generation into using an online process they don’t understand?  We keep programming everyone to think paperless is good and everything online is best, and the mysterious cloud that nobody understands is the future of everything.  Not too long ago, the entire financial system was on life support because of these loan products that borrowers were sold, which they never understood.  I haven’t heard anyone address fairness in the process by which all information is obtained.  In my view, that’s a bigger deal.  A mortgage loan affects one aspect of your life, but the data that makes up your entire identity has tentacles into every single aspect of who you are, how you spend money, your reputation, your job and every person with whom you associate.

I suspect that the push to the online, cloud, eclosing platforms is for the benefit of the lender, bank, investor and government entity.  If they can close more loans, they can make more money.  If they can grab all of your information quicker and validate it electronically, that saves time, which saves money.  If the government agencies can get to the lender’s electronic reporting data quicker, they can perform audits faster and collect more fines and penalties.  Efficiency has a big financial payoff in the long run.  I understand this from a business standpoint.  I just can’t help but wonder where it’s ok to lose the human touch without paying a price.  Aside from all the scams & cyber-threats, where does the lack of involvement with a person start to affect the client’s decisions?  When does our forcing a particular process on a person put them at risk?  Shopping for a loan is anything by sexy.  It’s not nearly as fun as shopping for a car.  You can’t kick the tires, smell the leather or take a loan for a test drive.  However, it is a huge financial and emotional decision for a person, and I still feel that the process deserves some respect.  First time homebuyers need to realize that it is a huge deal, and that it should be taken seriously.  After all, a foreclosure will be just as painful whether you closed your loan online or face to face at a title company.  At some point, I could see the fast & easy closing process as a defense to foreclosure.  I think I’ll call it the “it happened so fast” defense.

I suppose my entire security argument is probably mute at this point.  Pandora’s box has been opened.  Just the recent changes in the health care industry have now given the government access to our medical information on an intrusive scale.  With the HMDA changes going into effect soon, they are doing the same thing with mortgage loan data.  Privacy is a thing of the past already.  I suppose the only thing left is service.  I do feel that the lines between service and efficiency are becoming blurred as the human touch disappears from the loan process.  Does anyone else feel this way?  Until next time… “I’ll be back”.


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