Automated mortgage compliance systems for anything from RESPA to taxes are in demand.
After successfully testing its new Electronic Closing Network module for HUD, eLynx (a portfolio company of American Capital) said it will officially roll out the RESPA compliance enterprise system designed to connect lenders to the nation's largest title underwriters.
Updated under the new RESPA rules the platform is already built into the company's Electronic Closing Network that connects over 100,000 settlement agents across the country.
According to eLynx, feedback from one of the nation's top lenders indicates that it is a timely solution. So eLynx expects to get "significant adoption" now that the industry is in the process of updating their system to comply with RESPA's good-faith estimates and the HUD-1.
Recent changes to RESPA regulations limit the differences allowed between the fees disclosed on the good-faith estimates and the amounts collected from the borrower at the closing table, the firm said, requiring that "lenders and settlement agents work closely to negotiate fees and limit differences on the HUD-1 while preparing mortgage documents."
It offers the ultimate switch from manual processing of HUD-1 that required numerous phone calls and faxes to the option to collaborate electronically and in real time, benefit from process transparency, and faster communication and fee negotiations.
So far eCN—which was released last year—has been used to process over 1 million loans and has over 100,000 settlement agents registered users.
Sharon Matthews, eLynx president and CEO, says her company is "in a unique position to offer a solution to this problem" since as lenders try to avoid costly surprises and remain compliant easily, settlement agents have the information they need "to present a professional image at the closing."
The ever-changing regulatory landscape keeps creating the need for new solutions.
Compliance and tax management demand brought together Minneapolis-based International Decision Systems, whose expertise is in software that enables users to integrate all aspects of the mortgage process from origination to disposition and asset management, and Vertex Inc. of Berwyn, Pa., a provider of solutions that help streamline and integrate tax provision and compliance processes.
Jack Ferraioli, vice president of customer relationship development at Vertex, sees the integration of Vertex Indirect Tax O Series with his firm's ProFinia as a way to provide a needed compliance and tax management solution that is expected to improve tax department efficiency and reduce tax processing costs and compliance maintenance.
The integrated solution automates and centralizes all corporate tax processing and data and supports tax compliance processing for ProFinia customers in need of tax management tools.
"Ever-changing tax regulations put a large burden on the tax departments of equipment finance companies," says IDS director of product management, Katie Emmel, now ProFinia users can address these challenges.
Thanks to the integration Vertex O Series can integrate with ProFinia to support audit defense and tax reporting by adding several functions. Users can now determine where and how a transaction is taxed, along with what is taxed and how much tax is charged.
The software also includes leasing specific content such as over 60,000 rules specific to leasing including international rules on tax support and upfront taxes, rates and rules updated monthly, vehicle and equipment transactions, user-defined rules and the SAS 70 certified research process.
Tracking, reporting and accounting for sales taxes are challenges the integration helped relieve by offering various tax trigger points in a transaction's lifecycle. Tax events include origination, activation, asset split, asset upgrade, assignment, charge reversal, manual charge creation, midterm restructure, charge generation, buyout quote, agreement termination, asset disposition and address entry.
