Mortgage technology

When E-Loan started up in 1998, its slick-looking website masked a clunky paper-based process. But now it is launching the electronic signing of closing documents in first-quarter 2007, and its back office is all but paperless.This was the story E-Loan senior vice president Pete Bonnikson told attendees in his keynote address Monday morning for the 10th Annual Mortgage Technology Conference in Tempe, Ariz. The key to online lending today, he said, is to give the borrower an instant decision communicated by a live loan consultant who gets the borrower to lock in a rate and submit a credit card for credit and appraisal. Mr. Bonnikson said E-Loan consultants succeed in that goal 25% of the time. He boasted that E-Loan now gets high marks from 95% of Realtors involved in its purchase loans. The Pleasanton, Calif.-based company can be found online at http://www.eloan.com.

The Mortgage Industry Standards Maintenance Organization, a subsidiary of the Mortgage Bankers Association, has formed an alliance with the Federal Housing Administration.MISMO said the purpose of the alliance is the development and publication of government standards for data and electronic mortgage transactions involving government entities within MISMO's framework and using its infrastructure. The FHA will join MISMO's Government Housing Workgroups, which are being developed with the help of Ginnie Mae, a MISMO ally since last fall. Members of the Government Housing Workgroups are expected to include representatives of interested government entities (starting with Ginnie Mae and the FHA) and private-sector companies. MISMO can be found on the Web at http://www.mismo.org.

Wolters Kluwer Financial Services, Minneapolis, and Regulatory Counsel Group, an Atlanta-based provider of regulatory compliance services for mortgage lenders, have announced that RCG will resell the Wolters Kluwer StateLink Web-based compliance tool to its customers.The companies said StateLink provides quick online access to regulatory information on various topics relating to first and closed-end second mortgages for all 51 U.S. jurisdictions, updated continually by Wolters Kluwer attorneys and analysts. "After extensive research, RCG chose to offer StateLink based on its succinct and detailed information, easy-to-navigate format, and the responsiveness of the StateLink support team," said RCG president Scott Scher. The companies can be found online at http://www.wolterskluwer.com and http://www.regulatorycounsel.com.

Internet Brands Inc., a Los Angeles-based operator of media and electronic commerce websites, has launched Loan.com, a website that assists users in finding ethical lenders with the lowest rates.The company said Loan.com provides an outlet for both wary consumers and frustrated lenders by creating a "Trusted Marketplace," where lenders agree to a set of ethical business practices and borrowers are educated about what to expect during the loan process. All lenders listed on Loan.com confirm their support for the Borrower's Bill of Rights, a set of ethical business practices that describe how they interact with the consumer. In addition, lenders in the Ethical Lender Directory are ranked on a star system that will include feedback from consumers on the site, the company said. Internet Brands can be found on the Web at http://www.internetbrands.com.

KB Home, a Los Angeles-based homebuilder, has announced the launch of KBHomeowner.com, a website that offers tools such as seasonal checklists and neighborhood guides.The checklists are aimed at helping homeowners keep their homes in peak condition, and the neighborhood guides provide information on community resources and local hot spots, the company said. "Visitors can also read tips on fun and easy home ideas, from 10 simple tips for organizing closets to growing strategies for kids' rooms," KB Home said. The new site can be found online at http://www.kbhomeowner.com.

Informative Research, Garden Grove, Calif., has announced launch of a free fraud prevention tool, Credit Score Verifier, that offers to reduce mortgage lender risk and loan fallout.The company said the proprietary Web-based utility was developed to enable a lender to verify credit scores reported by any of the repositories before undertaking the time and expense of underwriting the file or ordering a backup credit report. The tool addresses the risk associated with the increasing popularity of nontraditional loan types that allow for no documentation and stated incomes, where fraud is always a major consideration, according to an Informative Research spokeswoman. The enhanced tool, formerly called Credit Score Validator, provides a way to assure a lender that a paper copy of a credit report has not been altered, Informative Research said. The company can be found online at http://www.informativeresearch.com.

Ellie Mae, Dublin, Calif., has launched a banker division in response to the introduction of Encompass Banker Edition.The new division will focus exclusively on Ellie Mae's banker and lender clients and partners. Ellie Mae's client base includes over 3,000 mortgage bankers, according to the company. Encompass Banker Edition has already been adopted by two dozen companies since its launch in late October 2006, Ellie Mae reported. Jeff Benjamin, the company's director of sales, has become vice president of the newly created division and will report to Joe Langner, Ellie Mae's chief operating officer. Mr. Benjamin will focus on business development efforts among wholesale lenders and bankers -- including the promotion of Encompass Banker Edition and Encompass Custom Edition -- as well as the company's full range of connectivity solutions for the wholesale banking community. The company can be found on the Web at http://www.elliemae.com.

Using document images in the mortgage underwriting process is the most critical component of going paperless, according to an annual survey by Atlanta-based Advectis Inc.Advectis said 92% of its survey participants cited the use of document images in underwriting as critical to moving toward a fully electronic mortgage. The survey also found that 70% of respondents said it is very important that new technology integrate with existing systems, and 64% said it is very important to have a Web-based solution. In addition, enabling collaboration with other mortgage market participants and functionality throughout the loan processing life cycle were both cited as very important by 56% of the survey respondents, Advectis reported. The company can be found online at http://www.advectis.com.

Radar Logic Inc., New York, has announced its launch as a technology-driven analytic and data business (whose first products relate to residential real estate) that has merged with Ventana Systems Inc., Harvard, Mass.Radar Logic said the two companies have developed proprietary mathematical tools and algorithms that extract statistical information from public source data relating to residential real estate transactions. This information will be used to maintain indices representing daily cash market-equivalent prices for various categories of real estate in different metropolitan statistical areas, Radar Logic said. "Radar Logic will provide a basis for financial and business tools that will be far more accurate and timely than previously available," said Michael Feder, chief executive officer of Radar Logic. "Our indices will contribute to the further evolution of an orderly and liquid marketplace for real-estate-based derivatives." The companies can be found online at http://www.radarlogic.com and http://www.ventanasystems.com.

Vuecentric Inc., the Austin, Texas-based developer of the MortgageDashboard loan origination system, is powering the back office for a new international mortgage lending effort to help American and Canadian buyers invest in Mexican real estate.MortgageDashboard is the first online lending platform to be adapted to an international real estate lending process, Vuecentric said. The company is working with GainClients Inc., a Web-based technology provider, and Carefree Mortgage, a Hermosillo, Sonora-based broker specializing in American loans for Mexican homes. GainClients is making the MortgageDashboard front end available for use on the websites of Mexico-based real estate agents, who use the software to send leads seamlessly through to Carefree Mortgage for processing and funding, Vuecentric said. The company can be found online at http://www.vuecentric.com.

McDonald Computer Corp., a Southfield, Mich.-based provider of automated loan servicing technology to the mortgage industry, has added a reverse-mortgage servicing component to its system.The company said the new reverse mortgage capabilities in its flagship product, Servicing/T.I.M.E., can manage all types of home equity conversion mortgages, including FHA-backed loans. "According to the National Reverse Mortgage Lenders Association, the number of reverse mortgages made in the U.S. in 2006 grew 77%," noted Jim McDonald, founder and president of McDonald Computer Corp.

Hanover Capital Partners, Edison, N.J., has embraced imaging practices for providing due diligence and quality control services to its investor customers with the selection of BlitzDocs, the flagship product of Alpharetta, Ga.-based Advectis.Advectis said Hanover has also become a BlitzDocs Certified QC Provider and BlitzDocs Certified Due Diligence Provider. As a certified provider on the BlitzDocs collaborative document network, Hanover is prepared to receive imaged loan folders from lenders using BlitzDocs to perform QC and due-diligence review, Advectis said. Lenders and investors can deliver imaged loan folders electronically to Hanover by this method. Hanover can be found on the Web at http://www.hanovercapital.com, and Advectis can be found at http://www.advectis.com.

ComplianceEase, San Francisco, has promoted its executive vice president, David Girling, to the position of president and chief executive officer.The compliance and risk management automation company's co-founder and former CEO, John Vong, will remain as chairman of the board, while another co-founder, Anita Kwan, will become chief operating officer and retain responsibility for finance, business operations, and administration. In his new position, Mr. Girling will be charged with expanding the company's already extensive roster of partnerships with loan origination systems and loan document providers as well as with Wall Street firms and other mortgage market participants. He brings over 20 years of experience in the financial services industry, including leadership positions with Shearson Lehman Mortgage, GE Capital Mortgage Corp., and PricewaterhouseCoopers. ComplianceEase can be found on the Web at http://www.complianceease.com.

Visionet Systems, Cranbury, N.J., has announced the introduction of VisiRetention, a campaign management and customer retention platform aimed at reducing risk and streamlining workflow for mortgage bankers.The company said the platform creates "a unified approach" to campaign development through the alignment of departments within the mortgage company, enabling lenders to retain their portfolios while increasing income through the identification of high-risk refinance loans. VisiRetention's campaign management system automates the mortgage marketing process and provides a user-friendly interface to enter the central system, Visionet said. "We developed VisiRetention to help mortgage bankers make well-informed, streamlined, and targeted campaign decisions to increase their success rates and remain compliant with auditors," said Visionet president Arshad Masood. The company can be found online at http://www.visionetsystems.com.

Fair Isaac has announced cross-industry confirmation that its FICO Expansion Score reliably and consistently predicts credit risk levels using nontraditional credit data.Results from a study -- including bankcard and auto lenders as well as mortgage lenders and investors such as Freddie Mac, HSBC, First Franklin, and Option One -- show that U.S. lenders can "confidently assess the credit risk of nearly 50 million Americans who have little or no credit information on file at the major credit reporting agencies," according to a Fair Isaac spokesman. The FICO Expansion score taps nontraditional sources of consumer data in order to assess the credit risk of adults, including recent immigrants and young adults, who have minimal or no credit history on file. Thirty-five percent of credit-underserved consumers in the study had FICO Expansion scores above 640, satisfying typical lenders' approval requirements.

Three "housing hot spots" in Ohio are among the five U.S. markets deemed most at risk for increased levels of mortgage fraud over the next 18 months, according to CoreLogic, a Sacramento, Calif.-based provider of fraud prevention technology and services to the mortgage industry.The five major metropolitan statistical areas most at risk, according to the Core Mortgage Risk Monitor, are Akron, Ohio; Dayton, Ohio; Detroit-Livonia-Dearborn, Mich.; Memphis, Tenn.-Miss.-Ark.; and Cleveland-Elyria-Mentor, Ohio. Although mortgage risk levels "remain relatively high," CoreLogic's chief economist, Mark Fleming, said the company is "seeing a stabilizing housing market characterized by decreasing house price appreciation and a slower increase in the risk index." The index measures collateral risk, which is risk related to the accuracy of a residential property valuation and "the sustainability of that valuation over the life of the mortgage due to the unique characteristics of the property, market, and mortgage contract participants," CoreLogic said. The company can be found on the Web at http://www.corelogic.com.

Ellie Mae, a mortgage software and services provider based in Dublin, Calif., has announced the introduction of Encompass Custom Edition, a customizable version of the Encompass loan origination system.With features like a custom-input form builder, business process management, and seamless process-to-process integration, the LOS enables businesses to streamline processes and achieve greater control and flexibility, Ellie Mae said. "We can't expect larger companies to build their businesses around a loan origination solution, so we're enabling them to customize the loan origination system around their company," said Jonathan Corr, Ellie Mae's chief strategic officer. Because security can be an issue, Encompass Custom Edition allows users to be assigned to user groups, so the company has control over who has access to what. The company can be found online at http://www.elliemae.com.

Market Kinetix LLC, Houston, has introduced Deal Maker, which the company calls "the only scientific analysis tool of its kind" that provides a customized action plan on how borrowers can achieve a target credit score.Previously, loan originators and borrowers had no tool for predicting how scores could change as a result of certain corrective actions, the company said. "Most originators have no idea how credit scores are derived and how the individual elements in a person’s credit history affect the final score," said Ron Litt, spokesman for Market Kinetix. ".... Deal Maker takes guesswork out of the equation and replaces it with clear, step-by-step instructions on how to correct any borrower's credit score, resulting in the desired increase." If a borrower is below the minimum score for a particular loan product, the broker can enter a target credit score and Deal Maker will produce a Mortgage Action Plan that spells out the steps needed to raise the borrower to that score. The recommendations include immediate, short-term, and long-term actions, along with a point value for each.

Broker origination vendor Ellie Mae, Dublin, Calif., has launched a migration tool to make it easier for Contour users to switch to its Encompass loan origination system.Ellie Mae, which made the announcement at the Western Regional Mortgage Brokers Conference in Las Vegas, acquired Contour several years ago and is offering the service to migrate those users to Encompass, its flagship product. The Contour Migration Wizard is available at no charge for those switching to Encompass. The tool will be officially released in December and allows users to transfer all their Contour data seamlessly into Encompass in a few clicks, according to Ellie Mae. The vendor can be found on the Web at http://www.elliemae.com.

Desert Document Services, Tempe, Ariz., has launched a promotion at the Western Regional Mortgage Brokers Conference in Las Vegas to make it easier for correspondents to draw documents and pass them on to their lenders and investors.Through the new plan, which expires Dec. 1, correspondents pay for documents as they do cell phone minutes in that they pay per use, but also have an extended contract. Desert Docs is also offering the correspondents three free months for signing a one-year contract. In this shrinking market, lenders are pushing more responsibilities to their correspondents to cut costs. Desert Docs said it has accommodated this market shift by migrating all its lenders and investors to a Web-based system that employs the principles of Delta Management. This strategy allows the vendor to pass on cost savings to the correspondent and, at the same time, better serve their lender and investor clients. The company can be found on the Web at http://www.desertdocs.com.