For better or worse


A coworker of mine sometimes wonders if our modern technology has really made things any better for us. He probably has a point. In some cases, it probably hasn’t really made things better. In other cases, it probably has.

When I bought my first house many years ago, I was surprised to see how many documents were being furiously faxed back and forth at the last minute between the various parties to the deal. Puzzled by this, I asked how they managed to close on mortgages before the days of fax machines. "Oh," I was told, "we didn’t need this stuff back then."

So it looked like when fax machines created the ability to easily send additional paperwork back and forth, additional paperwork somehow became necessary when it wasn’t necessary before. There was no drop in the foreclosure rate for mortgages after the introduction of fax machines, so that it looks like the additional faxed documents didn’t decrease lenders’ risks any. There was also no increase in the number of mortgages processed due to the ability to fax documents. So this use of fax machines is probably an example of modern technology that hasn’t really made things better.

On the other hand, some technology does seem make things better. Using a fax machine didn’t seem to make processing mortgages any better, but using e-mail does seem to do this. There’s at least one mortgage company that I’ve heard of that uses encrypted e-mail for mortgage documents. This has let them make their process more efficient – so efficient that they’re now processing about 20 percent more mortgages per year. This amounts to an increase in their revenue by about 20 percent, so this is probably a case where new technology actually made things better.

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