Some final tech thoughts from last week’s MBA Annual and this week’s round up of mortgage tech briefs…
Tech Buzz
One of the most widely voiced frustrations of tech providers and lenders alike is the Internal Revenue Service’s wet signature requirement on the Request for Transcript of Tax Return, commonly known as Form 4506-T. E-signatures have been legally binding in the U.S. for a decade and originators want the ability to submit 4506-Ts with e-signatures.
The form is a general transcript of a taxpayer’s return history. Lenders use it to verify income of potential borrowers. Conference attendees blame government inefficiency for the IRS not incorporating the necessary infrastructure to accept the forms. Some lenders said they understand the sensitivity of the form and the security concerns over releasing the transcripts with an e-signature, they argue if it’s OK for a taxpayers to e-sign their return to pay their taxes, they should be able to request their transcripts electronically as well.
Tech companies in the doc and disclosure space tell me they can get 4506-T e-sign capabilities ready very quickly, but are waiting on the IRS. Richard Hill, the MBA’s recently appointed associate vice president of industry technology, said the group will make a big push to work with the appropriate authorities at the IRS to reach the goal of e-signed 4506-Ts.
New Loan Quality Tech Comes to Market
Another trend tech vendors expect to continue for the next few months is the integration of Fannie Mae’s EarlyCheck service into loan origination systems. LOS providers said they’re working a feverish pace to get the EarlyCheck integration in place for future software updates.
Del Mar DataTrac, San Diego, added access to EarlyCheck to its LOS. DMD president Rob Katz said the service is just one tool that lenders are using to verify loan data and quality before closing to prevent buybacks and adding the integration to the LOS helps minimize the impact of the extra step on originators.
At Bensalem, Pa.-based ISGN, concern over buyback volumes has led to a surge in demand for the companies services, which include technology for loan audits, underwriting review, loan modification review and foreclosure documentation. While EarlyCheck helps ensure quality of loans sold to the government-sponsored enterprise, ISGN said future interest from private-market investors will require loan-level review data that can be quickly verified.
Pegasystems, a Cambridge, Mass.-based business process management technology provider is also getting into the buyback prevention space with a new software called the Consumer Lending Solution. The software integrates with LOS platforms and has multi-channel functionality so originators can specify quality checks based on multiple investor requirements from the point of sale to post closing. The company said it’s already got a “major, U.S.-based lender” using the technology.
Data-Vision Adds Sollen Pricing Engine to Consumer Portal
No MBA conference is complete without a slew of mortgage technology software integrations. Data-Vision, a Mishawaka, Ind.-based technology developer that specializes in providing e-mortgage origination software, integrated the product and pricing data services of Sollen Technologies, Dallas, to Data-Visions LoanQuoter consumer direct lending portal.
Sollen’s product and pricing engine continuously monitors the lender’s investors and updates rates accordingly. Lenders with LoanQuoter-powered websites can implement an interactive online mortgage application process that includes customized product recommendations, product and pricing data, live chat, detailed closing costs and automated pre-approval decisioning.
Wipro LOS Adds Compliance Review Integration
LOS provider Wipro Gallagher Solutions, Franklin, Tenn., and San Francisco-based automated compliance and risk-management provider ComplianceEase will integrate mortgage compliance audits into the Wipro’s NetOxygen Web-based LOS.
ComplianceEase provides loan-level compliance reviews and the software integration notifies origination employees when potential issues come up on a case-by-case basis within the LOS environment.
DataQuick Integrates New AVM to Reconciliation Platform
In the valuations sector, Wilmington, Del.-based MDA DataQuick is integrating automated valuation model technology from Honolulu-based Collateral Analytics to its collateral risk management platform.
MDA’s Collateral Validation software is an automated valuation reconciliation offering for the origination, secondary and default industries. The reconciliation software will benefit from a greater dataset with the addition of the Collateral Analytics AVM, called Value Range.
MRG Adds Xerox Coding to E-Docs
The shared customers of Dallas-based e-doc provider MRG Document Technologies and Xerox Mortgage Services, Alpharetta, Ga., can now use Xerox’s DataGlyphs, a secure bar coding technology to classify MRG-created documents before they’re transferred to the Xerox e-doc management software called BlitzDocs.
Xerox’s lender customers scan wet-signed or other paper documents into computers, code them with DataGlyphs and then transfer them to BlitzDocs.
Now, when MRG-prepared documents are printed and signed by the borrower, they can be uploaded directly into BlitzDocs without manual classification or inserting cover pages. In addition to e-doc management during the origination process, Xerox also offers e-vault service for electronic mortgage document storage after closing.
Warren Says CFPB Needs Tech to Succeed
The day after the closing of the MBA annual convention, Elizabeth Warren—Harvard academic, chair of the Troubled Asset Relief Program’s Congressional Oversight Panel, and now, President Obama’s adviser on the Consumer Financial Protection Bureau and a leading candidate to serve as interim chair of the agency—told an audience at University of California at Berkeley that information technology is the key resource in making the CFPB a successful and transparent operation.
“Information technology can allow us to hang out a virtual shingle in front of the agency and to declare our intent to the world. It's a lot harder to let yourself fail—and a lot easier for the public to hold you accountable—when you've transparently declared your mission and shared information the public can use to measure your success in meeting it,” Warren said in prepared remarks. “Technology can force this agency to remain true to its goals.”
Warren went on to say that technology-generated data will defy conventional wisdom that may be outdated and provide objective analysis of financial sectors. She added technology will create a virtual “neighborhood watch” for the bureau and consumers to identify bad actors trying to take advantage of consumers.
“This agency will do that as the cop on the beat watching huge credit card companies, local payday lenders, and others in between,” she said. “Technology can help us do that better, by making sure our enforcement priorities are tightly connected to the financial market realities as experienced by customers every day.”
