Guardian Expands Document Care
Guardian Mortgage Documents here has expanded beyond basic mortgage closing documents to provide a suite of transaction management services designed to optimize back-office loan closing activities.
And with loan originations starting to contract industrywide, the company believes more and more lenders will turn to outsourcing in search of cost savings and greater efficiency.
"When the volumes wane a little, we see a spike in interest for our outsource services," said Tim Anschutz, vice president of marketing at GMD.
Outsourcing, of course, can turn a fixed-cost department into a variable cost item. GMD's core competency is in the area of closing documents, but recently the company has seen tremendous growth in its transaction management system. That group's business has increased by more than 40% in the past year, and the company says that the pipeline of new clients getting ready to use the service is strong as well. But it is more than just efficiency that lenders are looking for. Today, many clients are interested in outsourcing or expanding their transaction management outsourcing because of concerns about reliability and regulatory compliance.
"We are also offering risk mitigation. If we don't close properly, we fix it or we pay for it," Mr. Anschutz said.
Guardian's transaction management services include tests to see if a loan runs into "predatory lending" thresholds that require additional legal oversight, he said.
"A lot of bankers out there don't know they have to run that stuff, and then they run into problems with the investor when they try to sell it," Mr. Anschutz said.
GMD also provides customers with the security of a large IT infrastructure devoted to closing documents and transaction services, including what Mr. Anschutz calls "word-class redundancy" for data security. The company has automatic rollover of data between two sites, and also has redundancy features at each site. That is reassuring in an age when disaster preparedness has come into sharp focus.
Guardian's Guardian Mortgage Services division, headed by vice president of mortgage outsource services, Mary Kladde, focuses on back-office operations. Business is up more than 40% from a year earlier and Guardian executives say that as lenders strive for greater efficiencies, outsourcing holds more appeal.
"One thing lenders want is an efficient data line to make the process of boarding new loans onto a servicing system more efficient," Ms. Kladde said.
The trend is unmistakably toward greater use of imaged documents, she said. But many investors and warehouse lenders still want the actual mortgage note in a paper form, she noted, and that suggests they still will need the services of a document services provider like Guardian. Because the paper is collateral in case the note isn't purchased for some reason in the secondary market, the warehouse lender wants to have it as their security.
She continues to see growing interest in the delivery of imaged documents among investors, in part because it speeds the turnaround time on lending. (c) 2006 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com