By Tony Garritano
What’s going on in the mortgage market? What trends should you be aware of? Tony tells you in this daily column.

Finicity And Capsilon Partner To Modernize And Digitize Mortgage Origination

Finicity, a provider of real-time financial data aggregation and insights, has an integration agreement with Capsilon, a provider of intelligent process automation software for the mortgage industry. Under the agreement, Finicity’s Verification of Assets (VoA) solution has been integrated into the Capsilon platform to improve the speed, user experience and economics of the mortgage process.

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Finicity’s VoA solution provides bank-validated insights into borrower assets, enabling reports to be generated in only minutes. The solution reduces fraud, frees up resources, shortens time to close and is now integrated with Capsilon borrower and loan officer workspaces to automate asset verification. This further streamlines the loan application process — borrowers no longer need to search for bank statements, and loan officers have more time to focus on higher value activities, such as getting more loans.

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“We’re excited to work alongside Capsilon with the shared goal of transforming the difficult manual mortgage origination processes of today into a modern and digital experience of the future,” said Steve Smith, Finicity CEO. “Finicity’s VoA reports are a key part of the next-generation mortgage process.”

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Capsilon builds intelligent tools that transform the way mortgage companies work. The end-to-end platform uses data and AI to automate manual tasks and enable better, faster decision-making.

“The mortgage industry is undergoing radical transformation driven by technology. Those who invest in the right technology now will gain a competitive advantage to help them minimize risk and accelerate growth as the market changes,” said Jim Obsitnik, Chief Operating Officer of Capsilon. “We’re thrilled to partner with Finicity to help mortgage companies speed up the application process and deliver better borrower and loan officer experiences.”

Both Finicity’s asset and income solutions are delivered under the CRA framework, which allows borrowers to directly obtain information on reports or submit disputes. Finicity’s status as a registered CRA is a symbol of its commitment to safeguarding consumer privacy and dedication to the mortgage lending space.

Finicity is an authorized, integrated provider of asset verification reports within Fannie Mae’s Desktop Underwriter (DU). This gives lenders a validated asset report through Fannie Mae’s Day 1 Certainty initiative. Finicity is also part of the Single Source Validation (SSV) pilot, meaning Fannie Mae will utilize transaction data from Finicity reports to validate assets, income and employment. A broader rollout of SSV is planned later this year and will build on Fannie Mae’s Day 1 Certainty initiative.

Finicity is also an authorized Freddie Mac asset validation report provider, and Freddie Mac and Finicity are working together on new methods to validate income from payroll deposit data from bank statements.

About The Author

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 tony@progressinlending.com.

Freddie Mac Expands eMortgage Solutions With DocMagic’s eVault Technology

Freddie Mac has implemented DocMagic’s  SaaS-based eVault technology and SmartREGISTRY platform. DocMagic’s eVault provides a secure electronic repository for storing documents and performing automated eNote certification to Freddie Mac eMortgage lenders via Loan Selling Advisor.  By automating the eNote certification process, Freddie Mac will speed the funding process, thereby improving liquidity in the mortgage markets and reducing lender’s warehouse line costs.

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“Freddie Mac is committed to streamlining the mortgage process for lenders and borrowers, and has been a leader in purchasing eMortgages since 2006,” said Andy Higgenbotham, Freddie Mac’s Single Family Chief Operating Office. “We rolled out our automated certification process in 2015 to speed up the funding process, thereby improving liquidity in the mortgage markets and reducing lender’s warehouse line costs. We are now expanding this process to include the DocMagic platform.”

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DocMagic’s eVault provides safe and secure storage for sensitive loan documents. It also automatically parses and validates data in a SmartDoc eNote against data in the user’s core system of record. Additionally, DocMagic’s SmartREGISTRY platform enables holders of eNotes to securely transfer these electronic documents to other eVault systems, such as those used by investors, conduit aggregators and servicers. Ultimately, it facilitates real-time access, delivery, storage and much needed control of electronic loan files.

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“Freddie Mac has been a long-time visionary and champion of eMortgages over the years and has made great strides with their unwavering commitment to automation across the supply chain,” stated Dominic Iannitti, president and CEO at DocMagic. “Now, with the successful rollout of SmartDoc eNote data validation prior to funding, this demonstrates the advantages and a clear-cut ROI of going completely ‘e.’ We look forward to ongoing collaboration with Freddie Mac and to further adoption of the digital mortgage process.”

Notable is that that Freddie Mac encourages the use of ‘SMART’ (securable, manageable, archivable, retrievable, transferable) eNotes because static documents do not contain source data, and thus make it difficult, costly and time consuming to confirm the data on documents match.

DocMagic established a process that guides lenders on how to begin using SmartDoc eNotes. The company’s eVault technology is integrated with its Total eClose platform, which is an eClosing solution that creates a 100 percent paperless digital mortgage process — from origination through eClosing, eWarehouse lending, investor eDelivery and eServicing.

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 tony@progressinlending.com.

Offering Up Intelligent Identity And Data Collection

Digital mortgage provider Maxwell has released Maxwell ApplyID, its next generation mortgage loan application and data enrichment API. The new release will enable clients — from brokers to national mortgage lenders — to pre-populate loan application data and develop new customer intelligence capabilities.

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The Maxwell ApplyID API unifies a consumer’s data fragments from a host of sources into a structured loan application, enabling data-driven organizations to quickly build profiles of their customers. By collecting their consent and verifying the consumer’s identity with their mobile carrier, Maxwell ApplyID gathers the borrower’s information from its network of data providers to pre-populate fields in a loan application including personal information, employment history, income, real estate owned, financial assets and more. With this new API, clients receive a completed Fannie Mae 3.2 file with minimal input from a consumer.

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This new experience enables lenders of all sizes to dramatically streamline the lengthy loan application process by leveraging the API’s intelligent data-collecting technology. ApplyID completely transforms the loan application experience, shortening what was once an arduous form into a small number of simple questions.

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“We are committed to looking for every opportunity to minimize the complexity and friction in the mortgage process,” said Maxwell CEO John Paasonen. “Maxwell ApplyID accomplishes this by dramatically simplifying the application process, reducing the time it takes a borrower to begin a relationship with their lender. Furthermore, as an API, it fully enables data-driven organizations to optimize their businesses and processes in a new way.”

About The Author

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 tony@progressinlending.com.

Capsilon Launches Capsilon IQ, Moves From Docs To Data

Capsilon has launched Capsilon IQ platform and Capsilon Data Audit app, and the rebrand of DocVelocity. More than 160 mortgage companies rely on DocVelocity for mission-critical business operations, and 15% of U.S. mortgages touch the system each year. Mortgage companies are under increasing pressure to deliver faster, easier mortgages at a time when margins are at their lowest point in years. Companies who want to compete need to evolve their businesses and transform how they work. To meet this need, the company is expanding the Capsilon platform to harness new technologies that drive this evolution.

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Introducing Capsilon IQ

Capsilon IQ is the platform at the heart of the next-generation mortgage operating model. Formerly known as DocVelocity, Capsilon IQ evolved from enterprise-wide document management to an end-to-end mortgage automation engine. It combines Intelligent Process Automation with patented data recognition and extraction technology to create efficiencies at every stage of the mortgage lifecycle. Capsilon IQ enables users to create intelligent work experiences that make people more productive and existing systems more powerful.

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Capsilon IQ: Document Edition includes the core document management functionality that solves key workforce productivity challenges of managing and manipulating documents. It speeds up loan intake and reduces the manual work associated with handling inbound documents.

Capsilon IQ: Docs & Data Edition includes all of the features of Document Edition, plus a new set of tools to help mortgage companies do more with their loan data. It includes Capsilon Mortgage Data Management, a data repository that companies can use to power their mortgage business. The platform absorbs millions of data points from documents and digital sources, standardizes them into a consolidated record for each loan file. With Mortgage Data Management, companies can ensure data integrity across all business applications.

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Companies can also extend Capsilon IQ with productivity boosting apps that speed up teams and their tasks, solving the biggest pain points that weigh mortgage companies down.

NEW Data Audit App

A major pain point for many of customers is the dreaded ‘stare and compare’ process that frustrates staff and takes up valuable time. Capsilon’s new Data Audit app frees up staff time spent searching for docs and data. It provides a single place to see and compare data across sources, including the LOS and supporting documents. Capsilon Data Audit flags data mismatches for review so staff can instantly spot where supporting documents and data don’t match.

Capsilon Data Audit boosts data integrity and drives productivity gains across functions.

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 tony@progressinlending.com.

Equity National Title Launches Transaction Management Application

Equity National Title, a national settlement services provider, has launched a transaction management application which allows all parties to monitor the status of a real estate transaction in real time. Equity National Title partnered with Salem, Massachusetts-based Easy Mortgage Apps in the design and production of the new app. It is believed to be among the first to allow REALTORS, loan officers and consumers to securely monitor their transactions from the moment they enter Equity National Title’s workflow until the real estate closing.  

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The app will allow users to place orders; generate quotes; receive and share status updates and even determine whether an eClosing is permissible and, if so, in what form. All functions are available to the user 24/7 and any authorized user with Internet access can access the information. Users can also upload documents (such as missing identification; buyer authorizations and the like) and see scheduled closings, including the location (and map directions) and parties expected to attend. The app also sets forth the process in a series of timelines, including important dates and milestones, as well as current status.  The app is available for Apple devices.

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“The industry has talked for decades about an easier way for REALTORs, loan officers and borrowers to know where the transaction stands without having to call the title company,” said James K. O’Donnell, Esq., President of Equity National Title. “It has historically been one of the chokepoints of the transaction. With the Equity National Title app, authorized users simply have to log in—at any time of the day—to see exactly where their deals are. No voice mails. No waiting. No miscommunication.”

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According to O’Donnell, the app came about after a series of anonymous surveys Equity National Title conducted among mortgage lenders and REALTORS. The consensus finding in the surveys was that loan officers and REALTORS alike sought, above all else, responsiveness and clear communication from their title and settlement services partners.  Easy Mortgage Apps President, Michael Kelleher, agreed. “The idea of using an app to cut unnecessary waiting and uncertainty from the process was past due for the industry, and we were delighted to partner with Equity National Title to make it reality. In fact, we went from concept to launch in about 90 days.  Both partners were on the same page with the same focus:  eliminating as much wasted time and needless delay from the title transaction as possible.”

O’Donnell continued, “As important as compliance and service are, we’ve been told repeatedly that our lender and REALTOR partners want, above all else, to know exactly where the transaction is at all times…and not have to wait or dial into a website to chase that information.  The app will save users an enormous amount of time and help improve the L.O.’s ability to serve her own clients as well as the clients’ real estate agents.

O’Donnell is quick to confirm that security is not compromised for convenience with the Equity National Title app. Users must undergo a three-step authentication process, including an initial authorization which identifies (and later confirms) the device being used by the authorized party. The access to the production system is also not direct, but instead, routed through an intermediate server designed to prevent unauthorized access to the platform.  The app has no connection to or access to NPPI whatsoever.

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 tony@progressinlending.com.

Ways For Title Agencies To Ensure Faster Closings For Their Lender Clients

Title companies have been under increasing pressure to increase efficiency, while also ensuring regulatory compliance and reducing costs. Across title operations, multiple parties are involved in almost every deal. Because no title agent wants to staff up, given the volume swings that the industry is seeing today, finding capable partners is the need of the hour.

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Title agents need to take control of their systems and processes so that they can ensure faster closings for their lender clients. What are ways for them to do this? In a new eBook the company has published, the company outlines the 8 key ideas for title agents to ensure faster closings for their lender clients.

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The work we do in the mortgage lending industry is too complex and has too many compliance ramifications; this work requires sophisticated technology,” said Alok Bansal, Managing Director at Visionet Systems. “The title industry, in particular, can significantly benefit from technology that will help them streamline and automate their workflows and meet their changing needs.”

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Some of the ideas that the eBook talks through in detail include automated workflows, intelligent vendor management, integrations, ease of use, managing security and compliance, having convenient features like bulk upload, auto-typing, the role of a customer communication portal, and the ability to customize and personalize your title production platform.  Download the eBook

Visionet provides back-office title services as well as a modern title production platform that meets or exceeds several or all of these requirements. With pay-as-you-go pricing to fit the specific needs and budget of each title company, Visionet’s back-office service offerings include title searches, loan reviews, loan modifications and HUD settlements to help agencies work faster, cheaper, and more accurately.

About The Author

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 tony@progressinlending.com.

A New Way To Increase Efficiency And Analyze Fraud Investigation Data

ACES Risk Management (ARMCO), a provider of technology for loan quality and compliance testing, data validation and analytics, announced the launch of Fraud Case Manager, a technology designed for managing and analyzing fraud investigations.

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“Fraud cases are full of confidential details and valuable data, and most lenders aren’t using this data to their advantage,” said Phil McCall, president of ARMCO. “Now lenders can use Fraud Case Manager to protect sensitive information, analyze data for strategies going forward, and increase efficiency and accuracy.” 

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Mortgage lenders, like all financial institutions, are required by law to monitor and report suspicious activities. Most lenders have numerous fraud investigations open at any given time. To manage them, they use spreadsheets or disparate technologies, both of which are prone to security breaches and errors. 

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Fraud Case Manager provides lenders with a secure, fully configurable web-based alternative where they can manage all fraud investigations in one central location, and avoid the risks and delays associated with traditional fraud case management methods. For example, users can track any detail of any case in seconds rather than searching through numerous spreadsheets and technologies. They can limit usage to authorized parties rather than using open access documents like spreadsheets. Fraud Case Manager allows users to analyze data and create comprehensive reports that provide valuable insights for strategies going forward, rather than remaining unaware of trends and reacting to repeated issues as they arise.

“Fraud will never be eliminated—lenders’ best defense is identifying trends as quickly as possible,” said McCall. “Now they can uncover the issues that trigger investigations in moments, whether brought about by staff members, oversights or any other variable. That’s the biggest step forward lenders can take in mitigating fraud risk.”

About The Author

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 tony@progressinlending.com.

Avoid Technology Disaster

Stories abound in the mortgage industry of large-scale technology implementations gone awry because what was delivered by the company’s IT department was not what the business stakeholders wanted. To avoid becoming another tale of mortgage industry woe, STRATMOR Group supports the creation of Business Level Agreements (BLAs) in addition to the traditional Service Level Agreements (SLAs) for IT projects.

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In her article, “May IT Be with You; Unleashing the Power of Business Level Agreements,” STRATMOR CEO Lisa Springer explains that in most mortgage companies, IT is guided primarily by internal and external SLAs, leaving out the business measures needed to give IT a voice in, and responsibility for, achieving enterprise business goals. Springer provides supporting data that indicates the disconnect between the business units and their IT team, and she draws on the expertise of two STRATMOR Senior Partners, Len Tichy and Michael Grad, for insight into the IT/business relationship.

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“There is a fundamental misunderstanding that IT is not as central to operations as Underwriting, Processing, and Closing,” says Tichy. “In many mortgage companies, IT is viewed as a group unto itself, a non-business unit expected to do the bidding of the business units who think they really know what the company needs. This approach puts IT into a near-vendor role, often keeping IT from the critical conversations held at the Big Kid’s Table where the decisions about business goals, success measurements and reward factors are decided.”

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In effect, “IT starts with one hand tied behind its back in most implementation projects,” says Tichy. “The relationship between technology and business must move out of the traditional ‘Your sandbox, my sandbox’ paradigm to a more collaborative playground where business and technology leaders have common goals, objectives and BLAs for achieving growth and the supporting financial goals.”

Springer says Business Level Agreements can help lender leadership get everyone on the same page and working toward reaching the lenders’ Target Operating Model objectives. “A BLA requires a business framework in which to work as well as an understanding of the business impact of the services being provided. By understanding the business metrics in which success will be measured, post technology deployment, both IT and the business can focus on the achievement of operational goals.”

Springer provides illustrations of a customer-centric Target Operating Model (TOM) and shows how the various elements of the TOM could be executed with a BLA integrated. She also offers possible BLA metrics and provides information on motivating and leading IT teams. “IT needs to have a seat at the strategy table,” says Springer. “IT’s participation in strategy design ensures that the organization has a well-rounded representation of business and technical experience and problem-solving capabilities to work through the challenges of doing business.”

In a second article, “Aligning Back Office Compensation with Achieving a Superior Borrower Experience,” STRATMOR Senior Partner Dr. Matt Lind draws upon data from STRATMOR’s 2017 Compensation Connection Study and MortgageSAT Borrowers Satisfaction Program. According to Lind: “Despite the emergence of Borrower Satisfaction as a key competitive success factor, virtually no lenders incorporate it into their back-office incentive compensation. The reason for this is that they are unable to monetize satisfaction.” Lind then goes on to show how to monetize borrower satisfaction for processors and closers—two roles critical in the origination process—and how they might then be rewarded or incentivized to further improve the borrower experience.

Click here to download the August 2018 edition of STRATMOR Insights for much more. To sign up to receive the report each month, please click here.

Also, connect with the most innovative technology players here.

About The Author

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 tony@progressinlending.com.

A New Way To Embrace Digital Lending

In response to our Lender Advisory Board we are making it easy for all mortgage lenders and servicers to connect to the most innovative technology players as they look to go digital. We have established the Digital Lending On Display Service to advance digital processes and help drive results for lenders and servicers. Check it out HERE

Court Rules All Participants May Be Liable For Fraud Loss

CertifID, a real time identity management platform that helps protect real estate professionals from wire fraud, released its most recent white paper, “WIRE FRAUD IS EVERYONE’S PROBLEM.”  Written by Thomas Cronkright II, CEO and Co-Founder of CertifID, the white paper addresses the recent ruling by the District Court of Kansas in Bain v. Platinum Realty, LLC et al. which heightened the standard of care owed by transaction participants to prevent wire fraud losses.  (Bain v. Platinum Realty LLC et al., Case No. 16-CV-02326-JWL, Dist. Court, D. Kansas, 2018). According to the ruling, anyone, including title agents, underwriters and mortgage lenders, involved in a real estate transaction may be held liable where fraud occurs, regardless of the relationship between the parties.

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The jury in the Bain case found a real estate agent and her broker jointly and severally liable for 85% of losses incurred by a buyer when the buyer was tricked into wiring funds to a fraudulent account in connection with a real estate transaction.  Based on the pleadings and motions filed with the court, the real estate agent’s email account was compromised by cyber fraudsters who used the account access to send fraudulent wiring instructions to the buyer.  The buyer trusted the wiring instructions because they were sent directly from the agent’s email account and contained information relevant to the upcoming real estate closing.  The jury found the agent and her broker liable for negligent misrepresentation and ordered both of them to pay $167,129.27.  Importantly, there was no direct tie between the buyer and the agent or the broker, as the agent and broker in this case, represented the seller.  The buyer was an experienced real estate investor that was unrepresented.

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“The moral of the story appears to be that, no matter your role in the real estate transaction, you have a duty to take reasonable steps against cyber fraud,” said Cronkright. “Title companies; loan officers, attorneys or financial institutions…this ruling sends a strong signal that we’re all responsible to guard against cybercrime and wire fraud.”

Cronkright states the case appears to expand the duty of care in two ways. First, participants may be held jointly and severally liable for losses due to cybercrime if their email, systems or information is compromised.  Secondly, the standard of care may expand to all parties in a transaction regardless of direct contract or fiduciary relationships between them.

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The white paper includes the following:

>> Key facts, pleadings, pre-trial motion activity, verdict and post-verdict motions; and

>> Ways to meet the new standard of care including best practices to keep you and your customers safe.

It is now available for download at no cost at https://certifid.com/white-paper-new-standard-care/.

About The Author

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 tony@progressinlending.com.