Market Analysis: Lean On Your Vendor

*Lean On Your Vendor*
**By Tony Garritano**

***Having trouble keeping up with new government programs and regulations? As I always say, that’s what technology is for. Vendors should do the heavy lifting for you. For example, PROGRESS in lending has learned that ISGN Corp. can assist lenders and servicers with their loan infrastructure needs in meeting the expected higher demand of distressed borrowers for the new streamlined federal Home Affordable Refinance Program (HARP). ISGN has been processing, underwriting and closing HARP loans for lenders and servicers in the original program for the past two years.

****ISGN can get lenders and servicers ready to meet the expected increase in HARP volume, primarily with three mortgage outsource opportunities. First, ISGN offers staffing augmentation that provides lenders with key personnel for processing, underwriting and closing HARP loans. Secondly, ISGN can provide component outsourcing in which ISGN handles an area of origination that might be a process constraint for a lender, such as processing, underwriting or closing.

****Thirdly, ISGN offers end-to-end HARP loan outsourcing, in which ISGN processes, underwrites, closes and sets up loan funding. Lenders can manage their customer calls through a single point of contact, while ISGN handles the loan fulfillment. ISGN has the experts to manage remote lender client connections through technology, which enables ISGN to use its proprietary workflow in concert with a lender’s system to generate more efficiencies and lower costs.

****President Obama initiated the new expanded HARP 2.0 in October to aid more borrowers. Only approximately 838,000 Fannie Mae and Freddie Mac mortgages were refinanced in the original program. Today, the government estimates millions of more homeowners will be eligible for the new simplified HARP 2.0, which is the only government program designed for underwater borrowers who owe more than their house is worth. HARP 2.0 started accepting applications on December 1, 2011 for loans sold to Fannie Mae and Freddie Mac on or before May 31, 2009.

****The new streamlined HARP 2.0 should generate substantially more volume for lenders, because it removes the old loan-to-value ceiling of 125 percent, so the program is now available to homeowners in states such as Arizona and Florida where LTVs have exceeded 200 percent on many homes. It also makes it easier for lenders to participate by relaxing the rules concerning loan buybacks based on the representations and warranties of the original loan.

****“Lenders today are looking more strategically in an uncertain marketplace at the expected higher HARP loan volume,” said Scott Slifer, president of sales and marketing at ISGN. “They no longer consider it just a play to hire more staff. Now they want to determine what their core competencies are and outsource their other lending components.”

Tony Garritano

Tony Garritano is chairman and founder at PROGRESS in Lending Association. As a speaker Tony has worked hard to inform executives about how technology should be a tool used to further business objectives. For over 10 years he has worked as a journalist, researcher and speaker in the mortgage technology space. Starting this association was the next step for someone like Tony, who has dedicated his career to providing mortgage executives with the information needed to make informed technology decisions. He can be reached via e-mail at