Wells Fargo Pilot User of Ellie Mae Loan Quality Tech

The correspondent lending division of Wells Fargo is serving as the pilot user for new customized investor guideline functions in origination technology vendor Ellie Mae's Total Quality Loan service.

Lenders and secondary market investors that use the TQL service get access to original third-party compliance and verification checks run during underwriting. Many lenders who use Pleasanton, Calif.-based Ellie Mae's loan origination system also use the Ellie Mae Network, a communication medium and delivery channel for third-party underwriting services like document preparation, income and employment verification, and credit checks.

For lenders that participate in the TQL service and order verification services via the Ellie Mae Network, two sets of identical results are provided. One is for the lender's underwriting use in the Ellie Mae LOS and the second is stored in what Ellie Mae calls a “tamper-proof” electronic vault for later investor due diligence reviews, knowing the third-party report wasn't tampered with by the lender.

Prior to the release of the TQL service in May, investors had no choice but to either order duplicate third-party reviews on loan files or go to each individual service provider for a secure original copy of the loan's review. Ellie Mae says its service reduces the cost of compliance reviews for investors because all the information is in the same place and cuts down on the added expense of purchasing additional reviews.

With the new features announced Tuesday, Wells Fargo Funding will be able to customize which rules and requirements individual investors require so they provide only the relevant third-party compliance and verification data that investors want.

“When lenders can match a loan to the investor's quality requirements throughout the origination process, there's less quality control work required by the investor, fewer duplicate services to be reordered, and ultimately, a higher salability factor for the lender,” said Jonathan Corr, chief strategy officer for Ellie Mae, in a press statement.

Ellie Mae executives had previously hinted at the relationship with Wells Fargo, when, during Ellie's second quarter earnings conference call, president and CEO Sig Anderman told analysts that a “top three lender-investor” was signed on to use the TQL service beginning in 3Q11. According to data compiled by National Mortgage News, in 2Q11, Wells Fargo purchased $26 billion in loans from correspondents, the most of any lender in the Quarterly Data Report.

In addition to the partnership with Ellie Mae, Wells Fargo Funding also approved electronic signature vendor Communication Intelligence Corp. for use by all its correspondent lenders. Redwood Shores, Calif.-based CIC said the deal was a continuation of its relationship with Wells Fargo and its correspondents.

The additional vendor will provide electronic delivery and signature services to borrowers for initial disclosures, helping lenders keep the process paperless deeper into the origination of a mortgage. In addition to traditional desktop computer-based e-signatures, CIC's technology includes functionality for signature pads and mobile devices.