Contact: Karmela Lejarde
Communications Manager
703-761-1274

Lombard, Ill.—1st Advantage Mortgage, LLC registered the first electronic promissory note (eNote) on the MERS^® eRegistry on July 23, 2004.

Because this eNote has been registered on the MERS eRegistry, it is the first truly uniform electronic note that can be bought and sold on the secondary mortgage market. Its registration on the MERS eRegistry ensures that only 1st Advantage Mortgage is recognized as the owner of the note, and provides any investor with the confidence that they can gain the benefits of purchasing this eNote while maintaining “Holder in Due Course” status.

“This technological advancement will dramatically change the way we do business,” said Paul Lueken, President of 1st Advantage Mortgage. “Meeting the demand for less paper in the home buying process has been advanced by MERS. We at 1st Advantage are proud to be the first lender to register the first eNote in the MERS eRegistry.”

The borrower, Audrey Edmiston of Bolingbrook, Ill., electronically signed the eNote and the entire closing document package during a standard settlement conference in the offices of Chicago Title in Lombard, Ill. Commenting on the process, she said, “Ten years ago, people would have many issues with this. Now it’s more routine. It’s just part of the process.”

“Electronic closing packages will allow us to be more efficient in getting closing documents to the title companies, and the cost of copying and shipping loan documents will be eliminated,” Lueken added. “And, because the eNote is registered on the MERS eRegistry, lenders who buy this note can provide better execution than notes still in paper form.”

The electronic closing was accomplished using patent-pending technology developed by Document Processing Systems (DPS) of Novi, Mich. The system, which is a secure, collaborative environment, was used by all parties—the lender, document provider, title company, notary and borrower—to create, execute and store all documents for the settlement.

"This process represents a giant leap forward in the way mortgage loans are settled," said Paul Rakowicz, President of DPS. "As lenders and title companies begin integrating this new paperless environment into the mortgage loan process, they will see problems with missing documents, missing or incorrect signatures, and incorrect information on documents vanish. This is a huge stride in quality control for the industry."

Immediately after the borrower and the notary electronically “signed” the documents (using a mouse and clicking on boxes on the screen), 1st Advantage registered the loan on the MERS eRegistry, making the loan immediately available on the secondary market.

“Until today, all other eNotes have been originated and sold through proprietary systems,” said Dan McLaughlin, Executive Vice President, Product Division, MERS. “This is the first truly uniform eNote since it specifically requires that it be registered on the MERS eRegistry, the industry standard solution for satisfying E-SIGN and UETA requirements. We applaud 1st Advantage for taking this historic step towards the paperless mortgage.”

Chicago Title, who executed the signing of the documents, followed their standard operating procedures during the entire process. They disbursed all moneys as usual and provided title insurance for the loan.

 “The conversion of the entire closing process from paper-based to electronic-based, with all the necessary security and legal requirements fulfilled, will have such a profound impact on