Mechanism Of Mortgage Lending From Homeland

Blockchain technology has attracted more attention in the world's financial services sector and is rapidly spreading to supply chain management, health care, shipping, food, and product tracking, transportation and sales to consumers. It improves transparency and visibility, accelerates transactions, reduces fraud and financial crime, technologies together and securely, streamlines business processes and reduces data duplication and keeps business value at the forefront. One of the platforms using this technology is Homelend. Homelend is a P2P mortgage lending platform based on blockchain technology.

Mechanism of Mortgage P2P loan Homelend

Homelend mortgage p2p loans work by infusing the business logic of mortgage lending into smart contracts.
Homelend creates a set of smart contracts that run the business process.
Homelend that allows individuals to borrow money from their friends in a trusted, transparent, and secure way.
The main idea is that borrowers and lenders are not linked through financial intermediaries (ie central bank or P2P lending platform), but by smart contracts that automatically run predetermined business logic.
To apply for a mortgage loan, the borrower must follow a predetermined path from the moment when the prospective buyer of the property applying for a loan, to the current closure of the mortgage loan and transfer the property from the seller to the buyer, to a series of business processes take place.
6 Homelend analyzes mortgage borrowers in order; allows the purchase of property, can be successfully repaid by the borrower and can be recovered to a satisfactory level in case of default.

P2P Loan Method Homelend
The Homelend platform will develop three different P2P lending methods: crowdfunding, pooling, and pure auction. The difference between these methods arises from the specific approach used and the previously approved mortgage loan.

Crowfunding method. This method is the simplest, prospective lenders will find investment opportunities in the form of "slices". From the borrower's perspective, the approved mortgage loan will be divided into smaller fractions, so different lenders can finance their loans by financing these "slices".
Pooling method. In this method, the lender will be able to invest the money through a smart contract before a specific mortgage loan to be financed has been approved previously. Investments are made under the same "slices" framework. The difference is that smart contracts will allow lenders to "buy beforehand" "slices" before they are made properly (after pre-approval of a mortgage loan).
Auction method. This method will be developed as a variant of the pure crowdfunding method. Unlike collection, no financial buffers will be involved. The main difference between auction methods and pure crowdfunding is that lenders will be able to offer better borrower conditions than those previously approved by the platform.

The final phase of the loan process
This is a complicated stage of the process of closing a mortgage loan. here is the process of its stages;

Signatory approval is required on many documents and involves multiple parties.
This is the moment when the property is transferred from the seller to the buyer/borrower, and when the promissory notes and mortgage deeds are issued and registered to support the lender.
There is a closing date. The closing date is very important, as it determines the time at which funds collected from the lender will be transferred to the seller.
The transfer will be executed by an intelligent contract that controls the crowdfunding mechanism.

Conditions that will encourage smart contracts to send funds to the seller precisely the closing of the mortgage. This transfer will be made in one of two ways, based on seller preference:
a) in cryptocurrency, directly to the seller's wallet; or
b) in fiat currency, by liquidating beforehand through a third party.
Option to liquidate into fiat currency will be offered to protect against price volatility of cryptocurrency. However, since digital closure procedures significantly reduce the time span between loan funding and closing dates, it is likely that many or most sellers will choose to receive funds in cryptocurrency.

Conclusion
Homelend is a P2P mortgage lending platform based on the Ethereum blockchain. The homelend lending process is very easy because it uses a blockchain based method and the transfer process runs on the Ethereum network. Security. convenient and transparency will be in the can by the borrower.

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