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SMARTDocs Versus PDFs—Why There’s No Comparison

It would be hard to argue that digital processes are better than manual ones—especially in the mortgage industry, given the hundreds of pages of documents involved in the typical loan transaction.

And while most industry participants have abandoned paper documents, the majority have only transitioned to PDFs, which are essentially digital photos of paper documents. By using PDFs, companies are missing out on the huge benefits of going truly digital with SMARTDocs. Here’s why.

PDFs in a nutshell

PDFs are merely electronic copies of printed documents—meaning that PDFs still require human processors and underwriters to read and understand their contents. While PDFs can be read by optical character recognition (OCR) and other tools, they can’t be read electronically with 100% accuracy—which means they still require human oversight.

And if a borrower must sign a PDF, someone must manually place signature tags onto them as well. So PDFs require a lot of manual effort, which not only adds costs and time to loan transactions, but also increases the chance of human error.

The beauty of SMART Docs

SMART Docs, on the other hand, are true digital documents capable of containing an almost unlimited amount of data that can be easily read, transmitted, and stored digitally, without human intervention or even the need for OCR tools. Hence the name SMART, which stands for Securable, Manageable, Archivable, Retrievable and Transferable.

The Mortgage Industry Standards Maintenance Organization (MISMO) defines a SMART Doc as “a single electronic document that binds together data and presentation along with other information needed to maximize its performance.” With SMART Docs, whatever information the borrower sees can be guaranteed to be the same information lenders use to process their loan.

Unlike PDFs, every SMART Doc also contains a secure record of when and where it was created, modified and sent. SMART Docs never have to be manually tagged for signatures, either.

SMART Docs make a truly end-to-end digital mortgage possible. They also make remote online notarizations much easier, too, because they contain a secure, verifiable record of the borrower’s signature, whether or not the borrower and the notary are in the same room.

The importance of a SMART Doc library

When you’re ready to ditch the time-sapping PDF habit, be mindful that you’ll want to use a document provider that is equipped with a full library of SMART Docs for every document type, not just the mortgage note.

When all the documents in a loan file are SMART Docs, lenders, servicers and investors don’t have to spend time and money on staff to inspect them for accuracy. Plus, it makes it easy to perform due diligence or compliance testing on a loan file electronically in just seconds.

Very few document providers have SMART Doc libraries. That’s why more lenders and servicers that are adopting SMART Docs have chosen Evolve Mortgage Services to implement digital mortgages. Through Evolve’s SigniaDocuments subsidiary, we offer a full library of MISMO Category 1 SMART Docs. Plus, we offer a complete eClosing platform that includes remote online notarizations (RONs), which enables Evolve to deliver an end-to-end digital mortgage process.

If you’re seeking to implement a truly digital mortgage process and would like to see the benefits of SMART Docs for yourself, just reach out to us at 888-892-1843 or drop us a note at [email protected].

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