How Blockchain solve the problem faced by the Mortgage Industry

Many areas in the financial world have been disrupted by the Internet revolution. However, mortgage lending, despite being one of the largest areas, is still generally conducted under the same traditional system, paperbased and involve many players, making them complicated, tedious and slow.

This has several negative consequences for the borrower as well as for other parties involved. First, there’s a real need for information gathering, analysis and checks to guarantee that the mortgage loan will be repaid. Second, this continues to be a paper-based legacy process that has not been sufficiently modernized and aligned with technological progress.

Blockchain technology has an enormous potential to address both of these facts. Due to its distributed nature, a blockchain ledger can significantly ease the transfer of and access to information for each of the parties involved in the mortgage value chain. Also, with its unique capability to generate trust, transparency, and record immutability, it is an effective move toward digitization, not only of mortgage documentation but of all related business processes. In the next sections, a brief explanation of the mortgage value chain will be given in order to point out the shortcomings of the current system. As will be observed, many of these problems can be addressed through blockchain technology