A Look at What Blockchain Might Mean For the Mortgage Industry

Overview

The mortgage industry is a massive one, with many individuals relying on mortgages to be able to afford to buy their dream homes. While many banks have mortgage solutions available, there are also a number or micro lending institutions that offer this service.

There are often a range of factors affecting mortgage rates and amounts, while technological innovations have also affected the ways in which the industry operates.

One major technological change that is set to have an effect on the mortgage is Blockchain.

What is Blockchain?

Blockchain essentially allows consumers and suppliers to connect directly, removing the need for a third party. It also provides a decentralised database or “digital ledger” of transactions that everyone on the network can see.

This network is a chain of computers that must all approve an exchange before it can be verified and recorded.

Blockchain stores the details of every transaction of the digital currency.

Once the transaction has been approved as valid, the block is added to the chain.

The technology can work for almost every type of transaction involving value, including money, goods and property.

Here’s what Blockchain might mean for the mortgage industry:

Many in the industry believe that blockchain will be used for digital currency or high frequency trading. This technology may also be useful for video recording of closings, notary seals, recordation information as well as e-notes and paper notes.

Blockchain technology can work with digital signing or with paper signing.

The technology may also make it easier for customers and investors to search for properties that are appropriate for them.

Furthermore, the use of blockchain technology in the mortgage industry provides opportunities to improve loan origination and execution, increase ownership transparency, enhance transaction security and integrity.