Today Figure Lending announced that it transacted with asset manager Apollo to originate and transfer a mortgage using blockchain technology. Most residential mortgages in the United States use the MERS mortgage registry system to log the current ownership of a mortgage. Figure used its Digital Asset Registration Technologies (DART) solution instead of MERS.
Figure has originated plenty of mortgages on the Provenance blockchain in the past, and it has also packaged them as asset backed securities. What’s different in today’s news is creating a mortgage as an eNote – a kind of promissory note – which makes it easier to transfer using DART. And the eNote is a non-fungible token or digital asset.
In the U.S. mortgage sector, many new residential mortgages are registered at public registries with MERS as the original mortgagee, acting as nominee for the true lender. That enables faster transfer of title by updating the centralized MERS database. When the mortgage is sold, the lender gets updated on the MERS database with no need to update the public records. MERSCORP is owned by ICE which also owns the New York Stock Exchange.
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