For years, electronic promissory notes represented a difficult middle ground in mortgage lending. The concept was good, the infrastructure was in place and early adopters showed that the model could work. Yet adoption remained uneven, often hampered by questions about investor acceptance, lender appetite and operational complexity.
That hesitation is becoming increasingly difficult to justify.
What has changed is not just the technology, but also the market’s tolerance for inefficiency. As funding timelines tighten, margins tighten and secondary execution becomes increasingly time-sensitive, lenders are reevaluating where friction still exists in their processes. Increasingly, the promissory note itself is part of that conversation.
Recent industry data suggests that eNotes are no longer a niche execution strategy. They become a practical response to liquidity pressures.
Adoption signals are no longer ambiguous
ICE Mortgage Technology reported that eNotes reached a record 12.86% share of all mortgages registered on the MERS system in October 2025, with more than 2.8 million eNotes registered to date. That milestone matters not because it represents saturation, but because it reflects sustained, measurable growth in live production, not pilot programs. Lenders that go fully digital rarely return, and any incremental gains compound downstream.
Even among lenders who have not yet implemented eNotes, intent is shifting. Fannie Mae’s survey data shows that while only one in five lenders currently uses eNotes, nearly two-thirds expect to do so within the next two years. The main barrier cited is no longer internal resistance or borrower willingness, but uncertainty about acceptance from partners and investors. That distinction is important. It suggests that the debate has shifted from ‘should we do this’ to ‘how do we align the ecosystem’.
That adaptation challenge is real, but it is becoming smaller. Agency acceptance is established. Ginnie Mae’s Digital Collateral Program continues to mature. Most recently, Ginnie Mae announced that eNote-supported MBS will be eligible for PIIT transfers under the agency’s Co-Issue program – an operational change that supports greater issuance flexibility while maintaining program oversight. Effective for issuances dated February 1, 2026 and thereafter, PIIT transfers may include eNote collateral, and Ginnie Mae reports that more than $102 billion in outstanding Ginnie Mae MBS is now backed by eNotes, backed by 47 approved eIssuers.
Full-year data from Ginnie Mae shows eNote growth of more than 300% from 2021 to 2022, followed by increases of 87% in 2023 and 67% in 2024. The slowdown reflects normalization rather than deceleration, signaling a shift from early experimentation to sustainable production. While investor demands are not uniform, they are increasingly documented and predictable. For lenders willing to map out underwriting criteria and standardize delivery practices, the path forward is clearer than it was a few years ago.
The economics behind the momentum
At the same time, leading lenders are showing what scaled adoption looks like in practice. Some settings now deliver the majority of their agency volume as eNotesindicating that digital collateral can function as a standard execution model rather than an exception. Those lenders don’t chase novelty. They hunt for certainty.
The business case for eNotes has strengthened as execution data becomes increasingly difficult to ignore. Fannie Mae reported that lenders who originate more than a quarter of their loans in the form of eNotes face near-funding timelines that are up to five days faster than comparable paper notes. In an environment where warehouse utilization and capital velocity matter, that delta is meaningful.
Cost savings follow speed. Data presented at the Mortgage Bankers Association 2025 (MBA Secondary and Capital Markets Conference).) has linked eNotes to an average savings per loan of more than $200, thanks to fewer document defects, fewer manual actions, and lower post-closing overhead costs. At scale, these savings impact staffing models and reduce the operational drag that paper collateral places on financing and delivery.
Scaling up requires operational discipline
The lessons are also better understood operationally. eNotes do not fail at the time of execution; they fail at transfers. Integration gaps between eClose platforms, eVaults, and downstream investor pipelines are responsible for most of the early friction. Lenders who view eNotes as a full lifecycle process, rather than a closing event, are the ones who scale successfully.
That life cycle continues to extend beyond just financing and delivery, but also service. Servicers rely on clear, authoritative control over the promissory note to support routine loan management, as well as more complex events such as service transfers, loss mitigation, and default resolution. When properly recorded, tracked, and maintained, eNotes can reduce uncertainty surrounding the location and control of banknotes, which historically has involved complicated maintenance efforts.
As wallets change hands, digital collateral can also streamline service transfers by eliminating the need for moving physical notes and manual reconciliation. Instead of coordinating the transmission of paper records and confirmations of custody, administrators can rely on standardized, auditable documents to confirm control and status. That visibility supports faster onboarding, reduces operational risk and helps ensure continuity as loans move across servicing platforms.
This includes validating metadata prior to transfer, explicitly scheduling exceptions, and ensuring monitoring occurs both after a loan leaves the closing room and throughout the life of the loan. It also means internal coordination. eNotes cover collateral custody, compliance, financing, secondary marketing and servicing. Programs stall when ownership is fragmented and accelerate when responsibility is shared.
That discipline often depends on lenders and servicers working with technology partners capable of supporting consistent execution across the entire loan lifecycle, rather than offering solutions optimized for a single stage of the process. Fragmented platforms can reintroduce the same transmission risks that digital collateral is designed to eliminate.
From digital initiative to basic capacity
Perhaps the most important shift is conceptual. eNotes are no longer seen primarily as an improvement to the borrower experience or as a milestone in digital transformation. They are evaluated as an execution strategy that includes origination, financing, delivery and service. Faster financing, fewer defects, stronger auditability and more predictable collateral controls are resonating with both secondary and service teams in a way that the first digital messaging did not.
The market does not demand universal adoption overnight. But it rewards lenders who remove avoidable friction from the movement of collateral. In this context, eNotes are moving from the category of “emerging technology” to that of an operational discipline.
For lenders assessing where incremental efficiency gains still exist, the evidence increasingly points to the note itself. The question is no longer whether the ecosystem can support digital collateral. The issue is whether lenders can afford to leave that value unrealized as execution expectations continue to rise.
Brian Webster is the president of NotaryCam, a company owned by Stewart.
This column does not necessarily reflect the opinion of HousingWire’s editorial staff and its owners. To contact the editor responsible for this piece: [email protected].
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