Mortgage technology

Fannie Mae and Freddie Mac officials are expressing concerns that the American Securitization Forum's efforts to draft consensus secondary market standards could potentially create another mortgage identification standard outside of the MERS Mortgage Identification Number and cause confusion in the industry. ASF has been seeking comment on delivery standards that are still under construction and may or may not include the MERS MIN. The ASF declined to comment on the issue. Each loan registered on MERS is given a unique MIN that identifies that loan. At present, the MIN and registering the e-note on MERS is mandated by both GSEs if they will accept an e-mortgage from any lender. Speaking at the Mortgage Bankers Association's Technology Conference in Las Vegas, Ted Adams of Freddie Mac stressed, "The MIN works and we're using it. The introduction of another loan identification number as purposed by ASF would be confusing." To combat the potential of the MIN being rendered obsolete by anything the ASF creates, R.K. Arnold, president and CEO at MERS, urged lenders to adopt e-processes and use the MIN, arguing that if usage is mainstream, the ASF will have to recognize the validity of the current MIN.

Fannie Mae and Freddie Mac officials are expressing concerns that the American Securitization Forum's efforts to draft consensus secondary market standards could potentially create another mortgage identification standard outside of the MERS Mortgage Identification Number and cause confusion in the industry. ASF has been seeking comment on delivery standards that are still under construction and may or may not include the MERS MIN. The ASF declined to comment on the issue. Each loan registered on MERS is given a unique MIN that identifies that loan. At present, the MIN and registering the e-note on MERS is mandated by both GSEs if they will accept an e-mortgage from any lender. Speaking at the Mortgage Bankers Association's Technology Conference in Las Vegas, Ted Adams of Freddie Mac stressed that, "The MIN works and we're using it. The introduction of another loan identification number as purposed by ASF would be confusing." To combat the potential of the MIN being rendered obsolete by anything the ASF creates, R.K. Arnold, president and CEO at MERS, urged lenders to adopt e-processes and use the MIN, arguing that if usage is mainstream, the ASF will have to recognize the validity of the current MIN.

With foreclosures on the rise, the share of Internet inquiries that include the keyword "foreclosure" has jumped in recent weeks, according to HitWise, an online measurement company. The week of Feb. 2 had the highest share, probably because of increased media coverage of the top foreclosure cities, said HitWise research director Heather Dougherty. But queries also jumped in the weeks ending Feb. 28 and March 7 to their second and third highest levels, respectively, in the last three years. Searches for "free foreclosure listings" and "foreclosure listings" topped the list of terms containing the word "foreclosure" for the four weeks ending March 7, which Ms. Dougherty said, "confirms" that many potential buyers are seeking bargains. The downstream sites visited following a keyword search uncovered a number of what HitWise labels as "uncategorized" sites that offer databases. Sites under that label are either too new or too small to be tracked, the Experian subsidiary says. But they nevertheless bear watching as they grow and compete for traffic.

BB&T Corp. has opted to embrace electronic signatures on disclosures and pre-closing documents.The company has chosen the Secure Lending solution from Fiserv for its e-lending purposes. Using the Fiserv solution will enable Winston-Salem, N.C.-based BB&T, the nation's 11th largest financial holding company, to manage workflow with compliance best practices by tracking and retaining all versions of the Real Estate Settlement Procedures Act three-day disclosures and other pre-closing documents sent to borrowers. The Secure Lending solution electronically streamlines and manages the sharing of upfront loan disclosures with borrowers.

BB&T Corp. has opted to embrace electronic signatures on disclosures and pre-closing documents. The company has chosen the Secure Lending solution from Fiserv for its e-lending purposes. Using the Fiserv solution will enable Winston-Salem, N.C.-based BB&T, the nation's 11th largest financial holding company with $152 billion in assets, to more easily manage workflow with compliance best practices by tracking and retaining all versions of the Real Estate Settlement Procedures Act three-day disclosures and other pre-closing documents sent to borrowers. The Secure Lending solution electronically streamlines and manages the sharing of upfront loan disclosures with borrowers. BB&T seamlessly sends the documents from their loan origination system to the customizable secure eLending website, where borrowers view, electronically sign, print or download them. BB&T will soon have the ability to receive the electronically signed documents, and any unsigned versions, directly back into their loan origination system, where they are then transferred into BB&T's internal document repository. The electronically signed originals can also be stored in the Fiserv platform electronic vault. Additionally, with the Secure Lending platform's new expanded reporting, BB&T is able to see full details and status of documents that have been electronically distributed through the platform, at a loan pipeline level.

SigniaDocs, Houston, has integrated its electronic vault technology with Equifax's identity verification engine to address their respective users' interest in using secure automation to counter increasing ID fraud through means in line with new federal rules. The engine, which is called Equifax Secure's eIDverifier, verifies online mortgage applications and the company promises borrower identification that is compliant with the Federal Trade Commission's Fair and Accurate Credit Transactions Act red flag rules. The rules, which first went into effect in November 2008 and are set for full enforcement as of May 1, require companies to look out for and address potential indicators that may be signs of ID fraud. A February report by Javelin Strategy & Research, San Francisco, indicated that the number of identity fraud victims increased 22% to 9.9 million adults in the United States in 2008.

Most Home Corp. Vancouver, British Columbia, has sold its point-of-sale automation tool, NetUpdate, to Mortgagebot, Mequon, Wis. Mortgagebot paid Most Home Corp. cash compensation of $600,000. In addition, Most Home is keeping approximately $107,000 in receivables that it had already billed or collected prior to closing. Before this deal came about, Most Home tried to sell NetUpdate to Data-Vision, but Most Home shareholders rejected the offer, which was structured as a three year arrangement that called for monthly payments, based on a percentage of gross revenues earned by the NetUpdate operations, with a minimum cumulative payment of $500,000 over that period. Most Home is focusing its efforts on mobile technology with this divestiture and Mortgagebot is gaining the NetUpdate customer base, which means Mortgagebot now serves 900 banks, thrifts, and credit unions nationwide.

Wolters Kluwer Financial Services has named Fran Sullivan to the newly created position of chief information officer within the company. Wolters Kluwer Financial Services provides regulatory intelligence, policy and process management, and oversight to help financial services organizations address their compliance needs. Mr. Sullivan will be responsible for the overall leadership of processes and practices supporting the flow of technology information across Wolters Kluwer Financial Services' different business lines. Wolters Kluwer Financial Services serves customers in the mortgage, banking, securities, insurance and indirect lending markets. Before he joined Wolters Kluwer Financial Services, Mr. Sullivan held several senior management positions related to product development, network services, systems integration and client integration at companies that included Fidelity Investments.

Direct-to-consumer FHA lender Lend America, Melville, N.Y., said it has built and implemented an automated "paperless" platform for loan originations and processing. Lend America launched the platform in early February 2009, and it said on Feb. 24 that all of the company's loan originations from application to closing are now conducted as paperless transactions. The technology, implemented under the direction of chief information officer Adeel Saeed, allows borrowers to e-sign disclosure documents via a secure portal and/or submit the documents required for their loan. The platform also allows borrowers to communicate in real time with Lend America's mortgage specialists. In addition, it is combined with an automated fulfillment process that can be tracked at every step through printed reports for those without online access if necessary.

MDA Lending Solutions, Wilmington, Del., has launched ARTAdvisor from MDA MindBox to help lenders better handle risk. The platform provides risk management from early risk detection through loss mitigation by automating the review, analysis and management of any size portfolio. Specifically, ARTAdvisor combines credit analysis with collateral analysis to identify risky loans and to propose optimal resolutions ranging from government-sponsored programs such as the FHA's Hope for Homeowners to lender-specific loan modifications. The platform uses a customizable rules engine to review any number of loans based on the organization's own standards for quality and performance. This risk management intelligence enables the organization to know how individual loans and entire portfolios are performing. ARTAdvisor identifies unseen or emerging points of risk, analyzes data from multiple sources to show trends in performance, identifies secondary market opportunities and accelerates loss mitigation strategies at the individual loan level and the portfolio level. It can also be implemented at the point-of-sale, pre-qualification or loan application stage to identify risk upfront.

Direct-to-consumer FHA lender Lend America, Melville, N.Y., has built and implemented an automated paperless platform for loan originations and processing. Lend America launched an automated paperless platform in early February 2009, and today all of the company's loan originations from application to closing are conducted as a paperless transaction. The technology allows borrowers to e-sign disclosure documents via a secure portal and/or submit the documents required for their loan. In addition, the platform allows borrowers to communicate in real-time with Lend America's mortgage specialists and is combined with an automated fulfillment process tracked at every step for those without online access.

Wingspan Portfolio Advisors, which specializes in highly delinquent loans, has launched a new consumer division focused on helping borrowers whose loans are in default. Dubbed "Foreclosure Resolution," the division will reach out to borrowers who are having trouble making payments, have been denied a loan modification, are considering bankruptcy, or who have ARMs balloon payments coming due.

Fiserv Inc. said it has enhanced its loan servicing platform product so that it can now manage indirect and other third-party loans. The single-platform capability broadens the spectrum of loans to be processed and provides online, real-time back-office transactions for diverse portfolios, Fiserv said at the MBA Servicing Conference in Tampa, Fla. The Fiserv 'Loan Servicing Platform' is designed to manage all current types of indirect financing, including same-as-cash and staged funding loans that manufacturers, distributors and retailers may offer to borrowers.

In response to the need for mass loan modifications, Lender Processing Services has created RediMod, an application designed to streamline the loan modification process. LPS indicated at the MBA Servicing Conference in Tampa, Fla., that this new tool addresses processing and fulfillment needs for loan modifications by automating loan eligibility and best-fit determinations. The application is modular to enable those servicers with partial workout processes to merely fill in the gaps if there isn't a need for a new end-to-end process automation approach. RediMod includes data and analytics models that assign each loan in a portfolio a default propensity and loss severity score. It also has a rules engine that identifies borrowers currently in default and those at risk of defaulting in the future.

Bensalem, Pa.-based ISGN Corp. said it has increased the flexibility of its LenStar technology, a Web-based attorney and referral communication system for the default management market. ISGN said at the MBA Servicing Conference in Tampa that LenStar's new functionality enables servicers to adapt to market changes. Among the enhancements are an executive dashboard that allows users to create customized views of LenStar reporting data based on their own management criteria. This dashboard provides a complete view of the loan timeline, including vendor and user performance, file status and portfolio management. LenStar also now offers a Referral Toolkit, which can be used to create new referral types such as additional bankruptcy types, litigation, lien monitoring, real estate-owned, loss mitigation and title claims.

Wingspan Portfolio Advisors, a Carrollton, Texas, firm specializing in saving seriously delinquent loans from foreclosure, has selected SigniaDocs' e-vaulting and e-signing capabilities to provide faster service for its loan modification efforts. "One of the most common reasons for loan modifications to fail before they get started is that borrowers will often give up on the transaction during the period between agreeing to the loan modification and signing the paper documents that create the new loan," said Steven Horne, Wingspan Portfolio Advisors' founder and CEO. "With SigniaDocs' eModification service, it all happens very quickly, and speed is essential to making the process work. They allow us to execute loan modifications in minutes by using the Internet and SigniaDocs' eMortgage electronic vault, instead of waiting for courier services." Wingspan Portfolio Advisors works mainly with borrowers who have given up hope because they are so far behind on their payments that lenders have often already begun the foreclosure process. Getting the loan modification executed quickly, Mr. Horne says, is essential to that process.

Loan servicers are incorporating more borrower verifications, such as those validating income and employment, into the evaluation process when considering borrowers for loan modifications according to Rapid Reporting. The Fort Worth, Texas-based vendor said at the MBA Servicing Conference in Tampa that until recently, loan servicers have largely relied on information compiled in loan origination when evaluating borrowers for loan modifications. Verifying income and employment reflects the servicing industry's move toward more thorough underwriting standards as the industry struggles to correct itself amidst the current foreclosure crisis. "We've seen a significant increase in loan servicers that are signing up for income verification for loan modifications, which represents a big change as servicers had previously not been involved with borrower qualifications," said Jay Meadows, chief executive officer of Rapid Reporting. "This indicates that the servicing industry is learning from industry problems and making definitive changes to proactively ensure higher quality loans. According to the Federal Bureau of Investigation, there is a strong correlation between mortgage fraud and loans that result in default or foreclosure, so it only makes sense to verify borrower information on loans in delinquency to ensure that the modified terms fit the borrower's capacity to repay the loan."

Gabe Minton, the former Mortgage Bankers Association vice president of industry technology and most recently chief operating officer at LOS vendor Mortgage Cadence, has joined Motivity Solutions Inc., a provider of optimization and risk mitigation software for the mortgage industry, as its chief strategy officer. In his new position, Mr. Minton is responsible for the overall strategic sales marketing and licensing of Motivity's products, third party alliances and strategic initiatives. Together with the engineering team, he will assist in further strengthening and expanding the foundation of their products and services. Also, in working closely with Motivity chief executive Tyler Sherman, Mr. Minton will create the architecture for smart imaging, e-mortgages, increased data integrity, and security to strengthen the positioning of Motivity's technology.

Point-of-sale vendor Data-Vision Inc. said it has missed a deadline to reach final agreement with Most Home Corp. on terms for its previously planned acquisition of NetUpdate Inc. Data-Vision president, Randy Schmidt, stated, "Unfortunately, after receiving board acceptance of the terms outlined in our Letter of Intent, the shareholders of Most Home were seeking much greater terms than we were willing to concede given the current market conditions. We are disappointed that the Letter of Intent has expired without being able to reach a definitive agreement." No further details were disclosed at press time. Data-Vision has been serving U.S. lending institutions since 1993 with a suite of Web portal and e-lending applications to facilitate online origination, point-of-sale, lead capture, instant decisioning, product selection, initial disclosures, and secure electronic document delivery to provide immediate returns for lenders.

The Mortgage Bankers Association and MERSCORP Inc. have entered into a management agreement under which MERSCORP will be responsible for managing the day-to-day operations of MISMO, and the MBA has laid off its entire industry technology staff composed of six individuals. Under the management agreement, MBA retains full control of the Mortgage ?Industry Standards Maintenance Organization Inc. and will maintain a permanent seat on the MISMO board of directors. John A. Courson, president and CEO of the association, said, "It has always been the intent for MBA to develop and nurture MISMO and then align with another entity to conduct day-to-day management of the company in a way that best serves the real-estate finance industry. MERS, as an industry utility owned in part by MBA, provides an ideal infrastructure for MISMO and will ensure the user experience of current MISMO participants remains constant at its current high level." Because MERS will now be running MISMO the MBA has laid off its entire industry technology staff including Harry Gardner, the MBA's VP of technology who had been charged with MISMO's oversight. Going forward, the MBA will create a new technology position that the organization expects to fill soon. The six impacted employees will be given preferential treatment if they are interested in applying for the position.