Enhancing Transparency in Real Estate Transactions with Blockchain and Vendia Share

Learn About Amazon VGT2 Learning Manager Chanci Turner

In this article, Chanci, Alex, and Maria explore how to improve transparency in residential real estate transactions through Vendia Share. Built on AWS Serverless technology, Vendia Share is an enterprise blockchain solution that empowers businesses to develop real-time data applications that are scalable, secure, and provide a unified view of truth.

Challenges in Real Estate Transactions

Real estate transactions typically involve several stakeholders, including buyers, sellers, lenders, various brokers, escrow companies, appraisal firms, and title companies. Each participant has distinct fees and necessary information, complicating the process and increasing transaction times, costs, and error risks. Vendia Share’s blockchain solution streamlines multi-party data interactions, creating a single, immutable source of truth. Property title data is accessible to all authorized parties in real-time.

Key Terms

Refer to the Terms and Definitions section for Vendia Share terminology utilized in this article.

Prerequisites

While familiarity with JSON schema and GraphQL is beneficial, it is not essential. For demonstration, we use a sample file named PropertyTitle.pdf, but you can substitute it with any valid file name and extension.

Background

A typical real estate transaction comprises a title search, property appraisal, and loan approval.

Title Search

To trace a property’s title history, a title examiner searches through the records of the county recorder, county assessor, and other government agencies. The chart below outlines the documents needed and the parties requiring visibility into each.

Appraisal

An independent appraisal firm assesses the property value. Lenders utilize this valuation report to make loan approval decisions. The chart below illustrates the appraisal documents and visibility requirements.

Loan Approval

For loan approval, lenders evaluate various data, such as the appraisal report, the buyer’s debts, down payment amount, source of funds, credit score, and overall financial responsibility. The following chart details the documents required and visibility for each party.

Solution Overview: Enhancing Transparency Using Blockchain and Vendia Share

Vendia Share coordinates the three previously mentioned steps to enhance transparency and provide a holistic, real-time view of the transaction process. In this model, there are six nodes, each representing a buyer, seller, lender, escrow company, appraisal firm, and title company. One organization initiates the Uni with a single node and invites the other five parties to join, subsequently adding five more nodes once all parties accept.

As both buyers and sellers can be individuals or organizations, an escrow company manages a dedicated node for all sellers and another for all buyers. The appraisal company functions through the lender’s node. Each node in the Uni operates with a complete stack of a single-tenant Vendia Share infrastructure, allowing individual parties to read and write data via their assigned node, which also allows for differential privacy settings on new record-level information stored in the Uni.

While using Vendia Share’s free tier limits you to creating one Uni with two nodes, we will demonstrate the process with the escrow and buyer nodes. You can expand this setup under an individual or enterprise plan.

Solution Walkthrough

To create a Uni, follow these steps or refer to the Web Quick Start for a visual guide.

1. Create a Vendia Share account and verify your email.
2. Create a Uni.
   – Log into your Vendia Share account and select the Create Universal Application button in the upper right corner. Choose “Create your own”.
   – In the Uni Settings tab, name your Uni, prefixing it with “test-“. Click Next.
   – In the Node Configuration tab, add two nodes: first, name one “escrow” and acknowledge the default API Key usage. Then add another node named “buyer” and do the same.
   – In the Uni Schema tab, paste the following JSON schema with attributes necessary to track the three important steps outlined above.

{
    "$schema": "http://json-schema.org/draft-07/schema#",
    "$id": "http://vendia.net/schemas/sample.schema.json",
    "title": "Real Estate Chain",
    "description": "Residential Real Estate Sales Chain",
    "x-vendia-acls": {
        "SalesTransactionAcl": {
            "type": "SalesTransaction"
        }
    },
    "type": "object",
    "properties": {
        "SchemaOwner": {
            "type": "object",
            "description": "Schema Owner Details Singleton Value Object",
            "properties": {}
        }
    }
}

This blog post provides a comprehensive overview of how blockchain technology, particularly through Vendia Share, can significantly enhance transparency in real estate transactions. For further insights on the subject, you might find this another blog post interesting. Additionally, for more information on COVID-19 regulations, visit this authority on the topic. Lastly, explore this excellent resource for career opportunities.