The risk management firms AllRegs and The Prieston Group have agreed to a multiyear commitment to join forces and offer risk assessment resources to the mortgage industry.
As part of its joint agreement, the two companies launched the Mortgage Operational Safety Assessment Firstscore this month, which indicates the overall corporate mortgage repurchase risk for a lender.
The MOSA score and report consists of a methodology and process that evaluates 11 different aspects of mortgage operations and origination including operational controls, company background, warehouse lines, geographic mix, product mix, repurchase history, quality control plan, operational checklists, broker management, correspondent management and appraiser management.
Lenders are evaluated with the risk assessment tools in MOSA and then receive a score between 0 and 800. A higher score indicates lower risk for the lender. In a recent study where 400,000 loans were reviewed, higher MOSA scores have been indicators in reducing overall mortgage repurchase risk.
“Ten years in the making, MOSA is the lender level due diligence tool all industry participants, including rating agencies, regulators, investors and lenders of all sizes, have needed to manage their appetite for risk,” said Arthur Prieston, chairman of The Prieston Group, Novato, Calif. “We are excited to bring together our resources and provide the mortgage industry with risk assessment tools that will impact the way business is conducted in the future.”
MOSA features an in-depth evaluation conducted by an independent third-party that includes file reviews and analysis as well as interviews with lender's key personnel.
After this process, mortgage lenders are given a score and detailed report of the assessment and evaluation findings. MOSA can be used to help benchmark organizations with others, as a chart will reflect your score compared to competing firms.
AllRegs has become the exclusive distributor of MOSA and its related products. Up until Nov. 1, the firm is offering a free introductory version of the product, MOSA Lite Firstscore, which consists of an abbreviated self-assessment that provides lenders their first MOSA score.
“MOSA is poised to be an industry benchmark that will help mortgage companies reduce their corporate risk, changing how they approach business,” said Dan Thoms, executive vice president for Eagan, Minn.-based AllRegs. “We believe that our combined forces, together with our business intelligence tools, industry distribution capabilities and other AllRegs core competencies will create a suite of powerful new products and services for the mortgage industry.”
