Home equity opportunities are expected to increase in 2025, but HELOCs are legally not considered transferable – or able to be sold to investors – in states where Uniform Commercial Code (UCC) Article 12 UCC has not yet been enacted.
As of January 2025, UCC Article 12, which is the amendment to treat HELOC Agreements as a transferable instrument, was enacted in 24 states plus Washington D.C., with five more states having introduced it.
In states where it has not been enacted, however, many lenders are not waiting for the acceptance of the amendment to sell HELOCs to investors. Some are moving forward through the use of contractual agreements with trading partners to treat eHELOCs as a transferable instrument. DLA Piper has published guidance with sample terms to be used in these agreements, lending credibility to this approach.
Docutech has introduced a solution with proven document and eVault technology. The newly launched SMART Doc eHELOC Agreement is registered with the MERS® eRegistry as a Controllable Payment Intangible and utilizes SMART Doc v1.02, the most accepted version of SMART Doc across the industry.
By leveraging the MERS eRegistry, the Docutech eHELOC provides critical transparency into who owns rights regardless of the eVault that contains it. And thanks to the company’s partnership with MISMO, this solution ensures interoperability for seamless transfers between eVaults. The document also uses MERS language as recommended by DLA Piper.
While Docutech has historically provided the PDFs necessary for originators to keep HELOCs on their portfolio, a shifting market is now providing expanded opportunities for home equity. The availability of their new eHELOC demonstrates their continued commitment to innovating to help lenders, servicers, originators, and investors stay competitive within a shifting market.
Interested in learning more about Docutech's eHELOC solution? Current clients can contact their Customer Success Executive. New clients can request a demo.
