Ellie Mae Soars 44% as Home Lenders Embrace E-Signatures

Ellie Mae Inc., a technology firm that processes almost a quarter of U.S. mortgage applications, is growing so quickly it ran out of room at its San Francisco Bay Area headquarters and had to cram software engineers into its gym.

Technology companies such as Ellie Mae, which almost doubled its employees to 700 this year as its shares hit a record high on Tuesday, are seizing an opportunity to transform how mortgages are made. As stiffer regulations make mortgage compliance more complicated, lenders who still depend on fax machines are turning to technology firms. Companies ranging from Xerox Corp. to Silicon Valley startups are vying for at least $5 billion a year in business from lenders, which face losses and legal penalties if loans don’t meet federal requirements.