Page 17 - February 2018 Disruption Report Flip Book

THE FUTURE FINANCIAL INFRASTRUCTURE FJEABNRUUAARRYY 22001188
How the blockchain mortgage works
Step 1:
Step 2: Step 3:
Step 4:
Step 5: Step 6: Step 7:
Step 8:
Borrower is pre-approved, finds home and applies for a formal loan approval.
The loan application is represented online as a “block”.
The block is broadcast to every “third party” involved in the home buyng process, including the bank, conveyancers, the credit reporting agency and the land registry.
Through data sharing on the blockchain network, the borrowers identity, bank account details, credit history and other personal data required for the loan application are verified.
A formal appraisal may still take place depending on the nature of the property.
A loan offer contract is generated and the borrower signs the loan offer with a private key.
The loan funds are transferred to the borrower and the block is added to the chain, providing a record of the transaction on the network.
The property and land title is also transferred to the borrower and the block is added to the chain, providing a record of the transaction on the networ.
Step 9: The borrowers becomes a homeowner in five days rather than 40+ days.
Theoretically, every element in a real estate transaction can be handled on the blockchain—from the real estate contract to the loan application, the title search, the online filing of the deed, to the closing statement. Going forward, the blockchain will be integrated into mortgage servicing, facilitating the automatic processing of mortgage payments and processing of foreclosures.
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