Information Focus May Speed Closings

The CFPB also has been “exceptionally data driven” in examining loan information. Image: Fotolia.

Outsourcing and technology companies, as they seek to help companies while improving efficiency, are finding data integrity is a key focus in quality control when it comes to getting a loan closed both efficiently and accurately in line with compliance, as well as sold optimally.

“It’s certainly a real hot topic right now,” said Judy Wheatley, senior vice president, compliance, at Indecomm, who said in her personal opinion, “There probably hasn’t been sufficient emphasis on the data.”

Wheatley finds this compelled not only by greater regulatory scrutiny but Fannie Mae and Freddie Mac’s focus on different delivery checkpoints and they focus on data-related initiatives. Because of this, “Lenders need to be exceptionally cautious” when it comes to their data before delivering loans.

Otherwise they face, for example, getting hit with a pricing adjustment if they do not correctly label a loan as, say, a funding on a condominium property, or if there are problems with their Home Mortgage Disclosure Act data that could reflect poorly on their fair lending record.

As a result, some lenders are looking to do things such as putting together a pre-closing quality assurance program review for loan data, making sure underwriting quality and eligibility are up to snuff.

“It’s starting to get the attention,” she said, noting that the Consumer Financial Protection Bureau also has been “exceptionally data driven” in examining how lenders control and use loan information.

The focus is coming now because the availability of technology is improving, Wheatley said, noting that automation that can capture and adequately analyze data has made “significant progress in the past couple of years.”

Teresa Blake, practice director, Wipro Gallagher Solutions, in a separate interview also noted the availability of such technology, adding that, she also thinks, “There is more that we can do.”

Blake said optical character recognition has advanced to the point where it can provide a more helpful role in ensuring data integrity. “I think it still has its limitations,” but still has enough benefits to offer attractive return on investment in some cases. The company offers it through partnership.

“It’s an evolution,” she said of QC measures in this area.

She emphasized that a QC focus on data integrity has a twofold benefit in that it not only ensures accuracy and compliance but does accelerate processing. OCR, for example, may help a company a document submitted is the right one at the outset, avoiding late discovery of errors and delays.

Blake said the process can be carried through to servicing through data mapping and validation. Her company works with LPS, for example, to ensure that data “reflects what is sitting in the origination system.

“No one in servicing should have to make any changes to that loan file,” she said, noting that a key check is when the closed loan file comes back from the title company.

“These are the kinds of things we’ve done” to ensure data integrity, Blake said, noting that while compliance tends to be the main catalyst for such moves, “quality and productivity have to be woven throughout the process,” too.