Traditional lenders are transforming, adopting cutting-edge technology to stand apart from competitors and introduce an added level of security to financing. From AI-run algorithms to smart contracts, obtaining a mortgage could soon be a vastly different process than buyers experienced just 10 years ago.
Industry disruptors, however, are looking to shift from the traditional model completely, threatening to take over the role typically performed by bank intermediaries, which buyers are accustomed to. “We created Block66 to offer new opportunities for borrowers and end the time-consuming and paper-driven processes in the mortgage industry,” said Joe Markham, founder and CEO of Block66, in a statement.
“Our platform will make it easier for everyone to find what they need so mortgages can be approved and funded faster. By storing the history of each transaction on the blockchain, we will provide a valuable audit trail for lenders, which will help mitigate mortgage fraud.” Additionally, Block66 states the addition of blockchain to a real estate transaction will reduce costs for buyers, as they will not have to be vetted via banks; instead, applicants’ information will be made public to any lenders using the platform.
Block66’s loans, which will become asset-backed tokens, will reportedly play a role in leveling the lending playing field, allowing all types of investors (not only big banks) to participate, and giving way to increased applications for buyers who would not be considered worthwhile by larger banks. “The idea behind mortgage tokenization is to bring in smaller lenders,” said Markham.
“They are often reluctant to tie themselves to longer repayment plans but are more willing to lend capital to customers who aren’t always favored by traditional banking institutions, even though they are creditworthy.” There are other challenges, as well. Smart contracts are not yet recognized by courts on a global level, an obstacle for Block66 when transacting across borders. Read more from rismedia.com…
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