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Unlocking eNote liquidity: insights from the front lines of the digital mortgage revolution

By Harry Gardner, Director of Digital Services at ICE Mortgage Technology
October 8, 2025

The digital transformation of the mortgage industry is accelerating, with electronic notes (eNotes) at the forefront, fundamentally reshaping the lending landscape. The momentum behind eNotes is undeniable, and the benefits are becoming increasingly clear to lenders across the board as our MERS® report on the September share of eNote production reached an all-time high of 12.77%. Recently, I had the privilege of asking industry leaders Mike Cafferky from Fannie Mae, Lynne Chandler from Ginnie Mae, and Kary McLaughlin from New American Funding to share their thoughts on investor delivery and acceptance processes in their eNote programs. Together, we explored the challenges, progress, and competitive opportunities this technology brings to the mortgage industry.

Why eNotes matter

The adoption of eNotes represents a major leap forward for the mortgage sector. By enabling fully digital loans, eNotes improve efficiency, reduce errors, and simplify processes from origination to servicing. However, as with any innovation, adoption takes time and collaboration. During our discussion, we highlighted the frameworks and resources now in place to help lenders overcome hurdles and embrace this transformative technology.

Getting started with eNotes

One of the key takeaways from our conversation was how accessible eNote adoption has become. As Mike Cafferky explained, Fannie Mae has created a consultative process to guide lenders step by step. Their readiness assessment helps lenders to have the right technology and procedures in place — not just for delivering eNotes, but also for servicing them and resolving any potential issues. Mike made it clear: any lender can participate, and the process is designed to set them up for success.

Similarly, Lynne Chandler detailed how Ginnie Mae has modeled its digital collateral program closely on Fannie Mae and Freddie Mac’s frameworks. Since securitizing its first eNote in January 2021, Ginnie Mae’s program has grown rapidly, quadrupling in size, with more issuers joining every month. It’s exciting to see this level of scalability and the growing infrastructure that’s enabling lenders to thrive in the digital space.

A lender's perspective on scaling eNotes

Hearing directly from Kary McLaughlin of New American Funding was one of the highlights of the discussion. Her enthusiasm for eNotes was infectious: “I love eNotes. They’re amazing!” she said. From faster certifications to fewer shipping issues, the benefits for her organization have been tangible. New American Funding now delivers 64% of its agency volume as eNotes, far exceeding the industry average.

Kary shared valuable advice for lenders looking to follow suit. She emphasized the importance of making eNotes a strategic business decision and getting buy-in from all departments. By incorporating eNote eligibility logic into their loan origination system (LOS) and making eNotes the default option, they were able to scale rapidly and unlock significant time and cost savings.

Addressing common concerns

Despite the progress we’ve seen, some lenders remain hesitant about adopting eNotes. A big part of our discussion was focused on dispelling myths and tackling barriers to adoption:

Investor support: A lack of investor acceptance may have been a hurdle in the past, but that has steadily improved over the years. More investors are accepting eNotes than ever before, making it easier for originators to remain competitive.
Warehouse banks: Setting up tri-party agreements with warehouse banks and end investors used to require a fair bit of time and effort. However, as Kary pointed out, more warehouse banks are now accepting eNotes, and the process has become significantly easier.
Misinformation: Misunderstandings about eNotes often hold lenders back. For example, eNotes are legal in all 50 states, and originators don't have to have a custodian to deliver to Fannie Mae, as Fannie Mae acts as the custodian. eNotes are not normally notarized, so they are not affected by the choice of eNotarization (or even paper notarization in a hybrid eClosing). And of course, eNotes can be commingled with paper notes in MBS pools — a common practice that shouldn’t cause concern.

As Lynne Chandler reminded us, it’s never too late to get started. In fact, lenders adopting now may find themselves at an advantage, as today’s platforms are more advanced and user-friendly than ever before.

The path forward

The message from our discussion was clear: the infrastructure and support for eNote adoption are stronger than ever. With the right technology, guidance, and commitment, lenders can unlock the immense benefits of eNotes, including faster processes, reduced costs, and fewer operational headaches.

For those ready to take the leap, there’s no shortage of resources. Fannie Mae provides detailed guidance through its eMortgage portal, and Ginnie Mae lists all program participants on its website. MERS eRegistry updates its list of active Member participants monthly, and MISMO® provides an e-Eligibility exchange to help lenders navigate the process.

Kary summed it up perfectly: “It’s easier than you think.” By making a smart, strategic decision and leveraging the support of industry leaders like Fannie Mae, Ginnie Mae, and MERS, lenders can step confidently into the future and reap the rewards of eNote liquidity. The time to embrace this change is now, and I’m excited to see how our industry continues to evolve and grow.