BMO's U.S. Residential Mortgage Refinancing Now with Fully Digital Capabilities

Rhea-AI Summary

BMO has introduced fully digital residential mortgage refinancing for U.S. customers in eligible regions, eliminating the need for in-person meetings. This initiative, part of BMO's Digital First strategy, enhances convenience and speed for customers. Through a partnership with Blend and the use of innovative technology, BMO has become the first bank to successfully transfer and pledge an electronic promissory note to FHLBank Chicago’s DocMagic eVault. Digital application usage has surged from 25% to 75% since the pandemic, indicating strong customer adoption of this new system, which aims to streamline the refinancing process.

Positive

• Introduction of fully digital mortgage refinancing enhances customer convenience.
• First bank to pledge an electronic promissory note to FHLBank Chicago.
• Increased digital application usage from 25% to 75% signifies strong customer adoption.

Negative

• None.

• BMO's digitization of mortgage refinancing, in collaboration with Blend's Close technology, will allow U.S. customers with properties in eligible states and counties the ability to refinance a home online and removes any in-person requirements to create a quicker and more secure experience
• The enhancement is the latest example of BMO's Digital First strategy to boost convenience and help customers make real financial progress
• BMO is the first financial institution to complete the transfer and pledge of an electronic promissory note (eNote) to FHLBank Chicago's DocMagic eVault and the Mortgage Electronic Registration Systems (MERS) eDeliver system

CHICAGO, Jan. 18, 2023 /PRNewswire/ - To simplify and expedite the homebuying process for customers in the U.S., BMO today announced that residential mortgage refinancing is now fully digital for loans secured by property in states and counties accepting recording of e-signatures and digital notaries. BMO will leverage digital mortgage technology provider Blend's mortgage eNotes capabilities and its Close product to allow customers the ability to complete their mortgage refinancing from anywhere at any time.

BMO is the first bank to offer electronic close on mortgage refinancing in the U.S. with Federal Home Loan Bank of Chicago (FHLBank Chicago), which involves signing mortgage documents digitally. Many e-closings still require at least one face-to-face meeting. Now, to enhance the end-to-end digital experience, BMO customers in certain jurisdictions can review and sign documents to finalize a loan all online.

"BMO's digital mortgage experience is all about making the homebuying process for our customers easy, efficient and fast," said Mark Shulman, Head of U.S. Consumer Lending at BMO. "With the combination of our innovative digital tools and support from our committed lending team, we are able to meet our customers' expectations for speed and convenience when refinancing a home. Through our membership with FHLBank Chicago and partnership with Blend, we have created an end-to-end digital experience that empowers customers with expediency and control, while offering access to lending experts throughout the process."

Blend's Close feature adopts a customer-first approach to closing by:

• Providing flexibility: Allows borrowers the ability to review and sign closing documents remotely, with the option for loan officers to follow along and provide guidance in real time.
• Offering transparent choice: Evaluate signing options after receiving remote online notarization eligibility information at the time of application.
• Keeping borrowers in one portal from application to close: Create an end-to-end experience by offering a remote signing room integrated into the borrower app.

"We are delighted to expand our partnership with BMO through this digital-transformation initiative," said Erik Wrobel, Head of Product at Blend. "We look forward to continued collaboration with them as they evolve their digital offerings to provide customers a mortgage experience that is unparalleled in speed, convenience, and control."

Digital applications by BMO customers have soared the last two years. Prior to the pandemic, roughly 25% of customers in the U.S. utilized BMO's remote online notarization capabilities compared to 75% today.

This enhancement is another example of BMO's Digital First strategy, focused on building a digitally-enabled, future-ready bank that drives progress for its customers, unlocks the power of its people and delivers loyalty, growth, and efficiency. This feature also complements a host of digital home lending capabilities and tools focused on helping its customers make real financial progress, including BMO's online loan application and refinancing capabilities, prequalification application, and its mortgage calculator tools.

"The transfer of this eNote is a significant milestone for FHLBank Chicago," said Sam Reindl, Vice President, Senior Manager, Member Product Support, FHLBank Chicago. "Interest in the ability to pledge eNotes as collateral continues to grow among our members and this first pledge demonstrates that we now have the ability to meet this growing demand. We appreciate BMO for partnering with us to complete this transaction and create a path for more members to begin pledging eNotes."

To learn more about BMO's home lending programs in the U.S., visit https://www.bmoharris.com/main/personal/mortgages/.

About BMO Financial Group

Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $1.14 trillion as of October 31, 2022, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.

About Blend

Blend makes the process of getting a loan simpler, faster, and safer. With its digital lending platform, Blend helps financial institutions including Wells Fargo and U.S. Bank increase productivity and deliver exceptional customer experiences. The company regularly processes nearly $2 billion in mortgages and consumer loans daily, helping millions of consumers get into homes and gain access to the capital they need to lead better lives. To learn more, visit blend.com.

About FHLBank Chicago

The mission of the Federal Home Loan Bank of Chicago is to partner with our members in Illinois and Wisconsin to provide them competitively priced funding, a reasonable return on their investment in the Bank, and support for community investment activities. FHLBank Chicago is one of 11 Federal Home Loan Banks chartered by the U.S. Congress in 1932 to promote homeownership. Our members include banks, thrifts, credit unions, insurance companies, and community development financial institutions throughout our District. To learn more about FHLBank Chicago, please visit fhlbc.com or follow @FHLBC on Twitter. "Downpayment Plus" and "DPP" are registered trademarks of the Federal Home Loan Bank of Chicago.

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements generally relate to future events, future performance or expectations and involve substantial risks and uncertainties. Forward-looking statements in this press release may include, but are not limited to, our expectations regarding our product roadmap, future products/features, the timing of new product/feature introductions, market size and growth opportunities, macroeconomics and industry conditions, capital expenditures, plans for future operations, competitive position, technological capabilities and strategic relationships. The forward-looking statements contained in this press release are subject to risks and uncertainties that could cause actual outcomes to differ materially from the outcomes predicted. Further information on these risks and uncertainties are set forth in our filings with the Securities and Exchange Commission. All forward-looking statements in this press release are based on information available to Blend and assumptions and beliefs as of the date hereof. Except as required by law, Blend does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

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SOURCE BMO Financial Group

FAQ

What new service has BMO introduced for U.S. customers?

BMO has introduced fully digital residential mortgage refinancing for customers in eligible states.

What technology does BMO use for digital mortgage refinancing?

BMO is leveraging Blend's Close technology to enable online refinancing.

How has digital application usage changed for BMO customers?

Digital application usage by BMO customers has increased from 25% to 75% since the pandemic.

Is BMO the first bank to offer fully digital mortgage refinancing?

Yes, BMO is the first financial institution to offer electronic closing for mortgage refinancing in the U.S.

What is BMO's Digital First strategy?

BMO's Digital First strategy focuses on enhancing customer convenience and driving financial progress through digital solutions.