The Machines Aren’t Taking Over—Blockchain in the Title Industry
It seems the title industry is finally getting some long-overdue national attention. Earlier this week, Bloomberg ran a feature on its site on the potential for blockchain to dramatically transform the home-buying process. While SafeChain is thrilled that innovation within the industry is being recognized on a national stage (and that we’re part of the conversation), there were some assertions made in the article that simply do not jive with how we view blockchain’s role in the market.
Ever since Arnold Schwarzenegger was sent back in time, people have been bracing themselves for a Terminator-like scenario where “the machines” begin to edge out humanity. In the title industry, blockchain has been billed by some as the “Skynet” that will eventually edge out human labor in favor of total automation. Of course, this view is largely pushed by entities outside the industry that lack a fulsome understanding of both the industry itself and how blockchain fits into real estate transactions.
First off, let’s dispel the notion that blockchain is title insurance. It’s not. Rather, blockchain is a database that helps strengthen the role of all parties involved by enhancing the level of integrity and security of the real estate transaction. Suggesting that blockchain could entirely replace the title industry is like proposing that an Excel spreadsheet could replace the mortgage lender – that’s simply not practical.
Title agencies and escrow companies are critical entities to the home-buying process. Without them, the 30-second real estate transaction our CEO Tony Franco referenced in the Bloomberg article simply isn’t possible – blockchain or no. SafeChain’s view has always been that our technology builds upon the existing title industry infrastructure and should serve to augment, not replace, the expertise of the title agent.
Furthermore, the foundation of the entire real estate transaction has always been relationships and trust, and discounting the importance of real estate professionals in the closing process does a massive disservice to the entire industry. No matter how automated the process becomes, at the end of the day, buying a home represents the largest financial transaction most consumers will ever make, and the vast majority want experts with them to guide them through every step of the process.
At SafeChain, we want our technology to foster and improve trust between all parties in the transaction, not diminish it. That’s why we are integrating the ALTA Registry into our real estate platform and why we’re partnering with companies like SoftPro to ensure our wire fraud prevention solution SafeWire fits seamlessly into title agents’ existing workflows and business processes.
Homeownership has always been the bedrock upon which Americans have built their financial worth, but that foundation is only as strong as the ability to establish the homeowner’s legal right to own that property. That can’t happen without the land registry system. Thus, title agents aren’t just the agents of closing. They are, in fact, the agents of economic prosperity for the entire nation, and technology cannot fulfill that role, no matter how advanced it might be. At SafeChain, we’re proud to support the role of title agents in the real estate transactions and look forward to helping agents enhance their role through the adoption of industry-leading technology like blockchain.