Ellie Mae Eyes Mod Market

Pleasanton, CA-Ellie Mae, a provider of loan processing software here, is creating and updating loan modification closing packages for several top 10 lenders.

Ellie Mae said clients are currently using the service to process more than 5,000 loan modifications per week. The service creates loan modification packages with Web-based data entry that require no rekeying of data. All documents are compliant with Fannie Mae, Freddie Mac and MERS requirements, Ellie Mae said.

The service assesses the needs of the lender's workflow, accommodates lender-specific workout plans, and handles all recording, notary and compliance monitoring needs, the company said. It can accommodate either "wet" signatures or electronic signatures on loan-mod documents.

Ellie Mae said the modification service is a collaborative effort between the company's loss mitigation partners and Online Documents, a firm recently acquired by Ellie Mae from Stewart Lender Services, with whom Ellie Mae has a partnership. The acquisition of Online Documents opened the door to serving larger clients.

"They had made some good progress in the loan modification area," said Jonathan Corr, chief strategy officer at Ellie Mae.

Because of the unprecedented number of regulatory changes, mortgage servicers are seeking industry experts to help them meet growing loan-mod volume while ensuring compliance with rules and regulations.

It builds upon Ellie Mae's acquisition of Contour back in 2001 and the subsequent evolution of Ellie Mae's Encompass origination solution, keeping document preparation within a single system rather than viewing doc prep as a complement to the loan origination system, Mr. Corr said.

"We basically came up with a model that was more of a Web services model where everything stays inside Encompass."

Working with larger mortgage servicers creates some complexity that needs to be addressed, Mr. Corr said, requiring flexibility and the ability to react to different levels of service demand. Online Documents has added to Ellie Mae's capacity to deal with the complexity of large servicing shops, he said.

"The way data comes out of their systems is all over the place," he said.

He said most servicers don't have the capacity to manage the rapidly growing volume of loan modifications.

Mr. Corr views the loan modification outsourcing opportunity as a "short window," which will probably wind down after two to four years. But Ellie Mae's loan modification program could evolve into some other form of long-term B2B commerce activity, he said. The whole process will give lenders more experience in how electronic commerce can benefit transparency and quality, he said.

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