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.

Market Analysis: Acquisition News

*A New Title And Data Quality Acquisition Deal Inked*
**By Tony Garritano**

***I sound like a broken record when I say now is the time to innovate, but it really is. Now is the time to take a new approach to an old method or strategy. To this end PROGRESS in Lending has learned of a creative acquisition that pledges to revamp the title sector. Charles Sanders, the founder of Urban Lending Solutions, a provider of residential and commercial mortgage products and services, has teamed up with settlement services industry veteran Michael Forgas, formerly CEO of National Real Estate Information Services (NREIS), to acquire RealtyData, a provider of title search productivity solutions. Sanders will serve as President and will hold a majority interest in the company and Forgas will serve as chief executive officer. Here’s the new company’s value proposition:

****“The technology that RealtyData has developed is very exciting and will change the way the title industry operates,” Sanders said. “That made the company a good investment at this time. I’ve known Mike for many years and look forward to working with him.”

****RealtyData technology allows title companies to automate title searches in 900 counties across the nation. In addition, a quality control engine can perform automated quality control on the resulting title commitments, reducing title agent expenses significantly.

****“The title industry has been slow to adapt to technological change, but economic pressure is forcing title agents to seek out tools that will allow them to provide their services more efficiently,” Forgas said. “Our technology allows title agents to not only be more efficient but also improve quality and at favorable prices. We must not forget about quality, especially in this time of significantly increased regulatory oversight.”

****Sanders said he and Forgas will first focus on penetrating deeper into RealtyData’s existing client base, moving good customers beyond simple searches and into the company’s quality control solution. For more information about the company, visit the website at http://www.realtydata.com/.

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.

Market Analysis: A Bright Idea For Servicers

*A Bright Idea For Servicers*
**By Tony Garritano**

***Yesterday I talked about how e-collaboration can benefit servicers. Today, I want to stay on the servicing topic because it’s a huge issue for our industry. Servicers need help. So, when I hear about new innovation happening in the area of servicing, I’m going to bring you that news. PROGRESS in Lending has learned that Wingspan Portfolio Advisors, a special servicer based in the Dallas area, is preparing to launch a new affiliate company, Wingspan Information Technology, LLC, aimed at helping mortgage servicers adapt to new requirements more easily. Here’s the scoop:

****The company makes available the same capabilities that have enabled Wingspan to provide single point of contact (SPOC) access for borrowers since its inception, and brings benefits of its centralized database approach that would otherwise require significant costs for servicers and lenders to achieve. E.J. Kite, Wingspan’s senior vice president of information management, describes the technology as a breakthrough for mid-market servicers and portfolio lenders who are deeply concerned about complying with new regulations. The old way of organizing information among different internal systems and trying to make them work together often creates more problems than it solves, he feels. Wingspan Information Technologies is offering a “single source of truth” approach to information, providing much greater efficiency and real-time transparency for investors and other stakeholders.

****“When everything is in one place, it is far easier to access data and manage it,” Kite explains. “When companies use a centralized approach, everyone stays on the same page, and that includes the borrower interface teams, making single point of contact an integral part of the servicing process.”

****Kite has more than 26 years of experience in mortgage technology, including over two decades at Freddie Mac. Prior to Wingspan, he spent three years at Fannie Mae as Management Information Systems director, working with Dallas area-based technology consultants Miller & Associates, a company specializing in business intelligence and custom software development, to build out the credit performance management reporting infrastructure. A longtime advocate of centralized database structures for mortgage servicing, Kite recommended the strategy to Wingspan founder and CEO Steven Horne while the company was being formed. Using Kite’s “results-oriented approach,” Wingspan created an infrastructure to manage large amounts of complex mortgage information, delivered in a highly useful form for finely directed applications. The approach integrates teams and aligns information and users with great precision.

****“Since day one,” Horne says, “Wingspan Portfolio Advisors has been a single point of contact company, creating very effective relationships with borrowers that have led to our outstanding track record of success.” Kite and Horne are working with Miller & Associates to bring Wingspan Information Technology’s benefits to servicers and lenders with very reasonable costs and implementation timeframes. The technology is highly customizable and leverages web portals for unprecedented access to information by those who need it. “Smaller servicers, including regional banks and credit unions, can achieve a level of servicing sophistication they have not seen before with Wingspan Information Technology’s offering,” says Horne.

****“We are also working with Dedo Interactive, Inc., a Miller & Associates spin-off which specializes in touch/gesture/mobile-based technologies, on a GPS-enabled smart phone application that will prevent or minimize many types of fraud from third parties,” Kite notes. “It authenticates field services providers at property sites, receives their updates and reports instantaneously, and adds transparency to all kinds of property management activities. It even handles location-verified photos from mobile devices to prove that the grass is cut and the hedges are trimmed to specifications.”

****Wingspan Information Technology expects to accept its first clients during the fourth quarter of 2011, with implementations completed in the first quarter of 2012. “We’re excited to be making these technology advancements available to the mortgage community and expect Wingspan Information Technology to provide meaningful assistance to the overall servicing effort,” Kite says. “Wingspan Portfolio Advisors has had great results with the platform, and we look forward to sharing what we have learned.”

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.

Market Analysis: Putting The Spotlight On Servicing E-Collaboration

*Putting The Spotlight On Servicing E-Collaboration*
**By Tony Garritano**

***I’m a true believer in electronic collaboration. It just makes sense. Why pick up the phone to order title, credit, the appraisal, etc., when you can put in an electronic order for all those services and more on a centralized system? I think this makes a lot of sense to most people in the mortgage industry, but most don’t think of it in terms of servicing, but rather in terms of origination. Not so, this approach benefits servicers, too, and vendors realize that. For example, PROGRESS in Lending has learned that DRI Management Systems, Inc. has launched the new DRI Office Service Ordering Platform, whereby servicers can automatically execute their orders for services, seamlessly manage the incoming information from providers, and tap a growing list of premiere, in-network vendors. Here’s the scoop:

****Servicers, already hard-pressed to keep up with the volume of problem loans needing attention, will find the Service Ordering Platform in DRI Office of great assistance, says DRI Chief Operating Officer Fred Melgaard. “We built the system to handle as many of the vendor ordering and management tasks as possible,” he explains. “The ordering process eliminates errors and non-reimbursable duplications, and the onboard rules engine makes ordering and acting on the results more automated than ever before. Vendor management tools are built in to maximize those relationships, and the integrated content management system stores and keeps track of things so nothing gets misplaced,” he says.

****The system keeps things as paperless as possible, eliminating the clutter and confusion in servicing operations of all sizes, Melgaard says, and the system is designed to deal with information flowing back from vendors, regardless of format. “By having everything integrated, the workflow becomes more efficient and productive, with impressive cost savings for users,” he says. Melgaard notes that a large national servicer had been spending up to a million dollars a month on duplicated orders alone and urged DRI to prioritize a solution to this problem.

****Steven Horne, CEO of Wingspan Portfolio Advisors, a Dallas area-based special servicer and long time DRI client, thinks that the cost savings offered by the Service Ordering Platform represent more than a simple benefit of using the technology. “The efficiencies and cost savings offered by the Service Ordering Platform will be very significant for our company,” he says. “A primary first lien servicer might find that with their volume, the savings would pay for most if not all of their DRI Office technology costs.”

****DRI’s Melgaard says that the company is adding vendors to its network of participating service providers. Early integrations with the Service Ordering Platform include Epiq Systems’ AACER® (bankruptcy creditor solutions), CoreLogic (automated valuations) and CoreLogic Credco (verifications services and credit reports), Equi-Trax (property valuations), NetDirector (connecting servicer’s systems to the platforms used by their law firms), SWBC (insurance coverage), and others. “We’re looking for the best vendors in the industry,” he notes. “The system benefits them too, by reducing their costs associated with order management and delivery.  All parties can focus on what they do best while we remove transaction friction and keep the default management process running smoothly.”

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.

Market Analysis: Going Turnkey

*Going Turnkey*
**By Tony Garritano**

***Right now everyone is talking about efficiency and ease of use. Some times that means switching systems. As a result, you’re seeing vendors embrace concepts like SaaS and cloud computing to make it easier for lenders to implement new technology. For example, PROGRESS in Lending has learned that Mortgage Cadence, LLC has introduced Mortgage Cadence Symphony Reverse, a reverse mortgage software solution, allowing lenders to get up-and-running quickly utilizing standard, pre-configured workflow. Products like this not only allow faster implementation, but also allow forward lenders to dabble in the reverse world. Here’s the scoop:

****In today’s environment, reverse lenders are facing the inevitability of increased Federal and State requirements surrounding reverse mortgages, just like in the forward mortgage world. In addition, as the country continues to struggle with high unemployment rates, Americans are banking on their home values to rebound and become a possible means to retire. As a result, the ability to quickly implement upcoming changes quickly and efficiently is a growing concern for reverse lenders. Symphony Reverse was designed to fill that technology void and address those concerns by enabling lenders to eliminate manual processes and increase their productivity and throughput. In addition, large players exiting the space have left an opening for lenders to gain market share. By leveraging Mortgage Cadence’s core technology, Symphony Reverse allows those lenders to quickly enhance their core platform while taking advantage of lower implementation timeframes and costs.

****“With the higher HECM Loan Limits set to expire on December 31st of 2011, there will be a revival of proprietary products. Fortunately, Symphony Reverse is flexible enough to support such products quickly,” stated Rob Jannotte, executive vice president of product development for Mortgage Cadence. “Coupled with the fact that many large reverse lenders have left the space, an opening has been created for mid-market reverse lenders and outsiders to get in the game and look to reverse mortgages as a way to expand their product offering and increase their profits.”

****The Mortgage Cadence Symphony Reverse product will also offer integrated documents through Finale Document Services. This document preparation and delivery solution offers document management and risk mitigation services.

****We at PROGRESS in Lending will keep you informed on the success of this product and any news of other vendors making similar moves.

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.

Market Analysis: See What I Mean?

*See What I Mean?*
**By Tony Garritano**

***Remember the industry scramble to be RESA compliant? Well, the new RESPA Rule has worked. It did its job. PROGRESS in Lending Association has learned that Ernst Publishing Company, an authority on land recording requirements to the mortgage marketplace, reports that a survey it conducted earlier this month showed that 57% of respondents think that the title and lending industry communicate “well” or “very well” in their efforts to comply with The Real Estate Settlement Procedures Act (RESPA). In addition, 35% describe the communication between them as adequate. Here are the other survey findings:

****“The ability for title agents and lenders to communicate is critical to compliance with RESPA, so that statistic is welcome news for the mortgage industry,” said Gregory E. Teal, president and chief executive officer of Ernst. “Moreover, it suggests that they are working to ensure that regulations are closely followed and complied with.” The Ernst survey was e-mailed to more than 8,600 clients of the firm, of which almost 6% responded.

****The aim of the study was to provide insight on how the industry was faring under several new regulations. “According to the survey results, many financial organizations have increased their ability to handle the new rules. For instance, 52% of respondents reported they were more prepared for the CFPB than they were six months ago,” said Teal.

****The survey also found that 65% of respondents reported they did not believe there is still a disconnect between RESPA requirements for the GFE and the closing table;  82% of respondents thought that lenders are able to meet RESPA requirements and provide clear instructions for closing; 84% reported that costs decreased or stayed the same when they implemented an automatic tool to assist with the GFE-HUD1 process; and 59% believe the combined GFE/TILA will make closing loans easier for them.

****So, while RESPA and other recent regulatory changes may seem like a burden, when the industry responds to these changes by further automating, everyone wins.

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.

Market Analysis: A Dynamic Approach To Compliance

*A Dynamic Approach To Compliance*
**By Tony Garritano**

***Everyone is worried about compliance these days. But of course, I’m going to tell you that technology can help, and it is a true statement. For example, Motivity Solutions, creators of the business management platform called Movation, has formulated a new approach to tackling compliance. The pace of new regulation has been feverish to the point when it is almost unbearable for mortgage lenders. In response, Motivity Solutions has adopted a performance-driven approach that helps lenders remain ahead of any new regulation. Here’s the scoop:

****Lenders that develop performance driven operations in an uncertain lending environment can realize the advantages that streamlined mortgage operations can deliver in terms of measurable business benefits and the impact it can have on their overall go forward strategies. Specifically, business intelligence (BI) technology can help lenders handle a host of compliance issues all within one system.

****As lenders look to cut costs and be more efficient, BI technology delivered by Motivity Solutions through its Movation platform can ensure that individual activities are automatically assigned to employees based on their role and your company processes. Every employee has a workspace that displays the task they are working on and which tasks need to be completed – automatically and in real-time.

****Managers can view the workload of their entire team and can easily assign work and load balance as necessary. Features like those described are important because lenders need to know where they stand relative to new regulation for a variety of reasons. For example, earlier in the year the mortgage industry was hit with new loan officer rules that stipulate that loan officer compensation cannot be based on a mortgage transaction’s terms. In order to avoid a stiff penalty and the label of being predatory, lenders can use Movation to track all elements of the loan and LO compensation.

****Also this year the mortgage industry saw changes made to the good-faith estimate (GFE). Changes on the new GFE deal with binding fees, changes in how the origination fees/discount points are determined, how these are disclosed and what can and cannot be changed. Lenders will find it difficult to comply if they do not have a complete understanding of every element of the loan. Movation provides the ability to “manage by exception” and drill down to the underlying loan-level detail from multiple data sources.

****However, if the technology is not accessible, it will not get usage. For this very reason Movation makes BI extremely user friendly and visual. To this end, Movation provides scorecards to enable the lender to be even more compliant and performance driven in a very complex mortgage environment. Movation Scorecards incorporate a variety of Key Performance Indicators (KPIs) which are defined metrics used to align small-scale operational activities with large-scale company goals. These KPIs are combined into a Scorecard which constantly monitors performance allowing you to compare and analyze goals versus actual results. Movation takes this a step further by proactively alerting key users when a pre-defined event occurs or when a threshold is reached.

****But scorecards are just one way to make BI actionable. The technology also incorporates dashboards. Through the dashboards users graphically see high-level summary data and have the ability to drill down to refined levels of data to instantly identify and solve the root cause of a problem. Movation’s Dashboards are role-based and customizable to ensure employees only have access to relevant, job-specific data.

****Together this technology can make it possible for lenders to get a handle on their operation and not only react to new rules and regulations, but to also get ahead of any new regulations that may come down in the future.

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.

Market Analysis: Let’s Take On The CFPB

*Let’s Take On The CFPB*
**By Tony Garritano**

***The “Know Before You Owe” initiative at the Consumer Finance Protection Bureau began in May of this year when the new watchdog agency asked the public to compare two different draft designs of a new streamlined mortgage disclosure. In the months that followed, the CFPB used that input to help it improve initial draft designs. Altogether, the CFPB received more than 22,000 comments on how to improve mortgage disclosures. When revised disclosures are released it will represent yet one more hurdle for lenders already struggling to keep up with compliance requirements that continue to become more complex.  In response to an ever-changing mortgage market, PROGRESS in Lending has learned that document compliance provider MRG has embraced a data-centric approach to document creation that will help lenders comply with this and any other document compliance issue that may arise in the future. Here’s the scoop:

****Lending has significantly changed over the past couple of years.  The pressure on today’s lenders is enormous.  This lending environment creates dramatic loan document challenges and risks for lenders.  Changing rules, regulations, and the ramifications of non-compliance, including fees, penalties and the possibility of buy-backs make the origination process an escalating challenge.  Traditional “doc prep” is no longer the answer when lenders are trying to handle these complex and ever changing requirements.

****Most lenders, quite frankly, don’t have the time or resources to staff a compliance department that can constantly monitor and accurately interpret the vast number of regulatory changes that are being implemented on a federal, state and local level.  Unfortunately, the same is true for many traditional “doc prep” providers.  Those providers that rely on an antiquated forms library to deliver static documents, with limited legal compliance analysts, are no longer a prudent choice.  Relying on outdated, traditional “doc prep” is a risk that lenders simply cannot afford to take in an increasingly “compliance-centric” environment.

****To this end, MRG Document Technologies (MRG) delivers complete, real time mortgage compliance directly into the document process – no static document templates for the lender to choose and manage internally. MRG attorneys constantly monitor the ever changing regulatory landscape and provide dynamic document compliance. MRG does not license any third party content or calculations, which allows MRG to fully rep, warrant, guaranty, and defend, its product. The product is backed by an E/O policy from full disclosure through closing packages, including calculations.  No more need for an internal compliance staff to manually manage package content or selection, for fear of inaccuracy.

****All document and calculation updates are compliantly and automatically delivered in real time. Together with the lender’s chosen LOS for a seamless, “lights out” approach, disclosure packages are drawn within 30 seconds and closing packages in just a couple minutes. Throughout the package request process, loans are checked with industry leading automated loan compliance tests, thus eliminating the need for additional 3rd party vendor software. In addition, MRG attorneys are available for services regarding general compliance advice, which is built into the overall compliant document solution.

****These comprehensive document compliance solutions provide lenders with the ability to enhance their compliance initiatives. It also gives lenders the tools they need to increase loan production, speed up turnaround times, while significantly mitigating risk. By providing a staff of mortgage banking attorneys to lenders, MRG also delivers the support and regulatory monitoring required to ensure loans are meeting the latest regulatory demands.

****Lending has changed forever. So too must the lenders document preparation solution.  No longer can lenders rely on antiquated form libraries and technology from traditional “doc prep” providers that have limited legal expertise and experience.  The risk and exposure is far too great.

****In today’s regulatory environment, lenders must demand more from their “doc prep” provider – compliance and dynamic content technology.

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.

Market Analysis: It’s Time To ENGAGE

*It’s Time To ENGAGE*
**By Tony Garritano**

***After much planning, ENGAGE 2011 was a big success. PROGRESS in Lending Association held ENGAGE 2011 on October 9 to provide a forum for industry participants to share ideas. And sharing ideas is exactly what happened. Opinions of all shapes and sizes flew about. It was a real lively exchange. And after all, that’s why we started ENGAGE 2011. Here are some highlights:

****We heard breaking news from Larry Huff at Optimal Blue as he discussed why his company acquired Sollen. Industry consolidation is certainly a product of a very tense market.  In addition, new partnerships were announced. a la mode announced that Xerox Mortgage Services will use Mercury Network’s DataCourier service  to add a new appraisal management service to the BlitzDocs® intelligent collaborative network.  Xerox Mortgage Services’ clients will now be able to receive and store appraisals in the BlitzDocs electronic loan folder™ (eFolder), submit appraisals to the GSEs in compliance with the Uniform Appraisal Dataset (UAD), and also send the appraisal and all related documents to investors.

****Mercury Network will allow BlitzDocs users to manage the newly required “UAD” MISMO 2.6 Errata 1 GSE Extended format  appraisals inside their eFolder, and receive Native XML directly from the largest panel of appraisers in the country.  The Native XML eliminates the need for error-prone PDF conversion and the fees and possible delays associated with sending PDFs to the GSEs.  In addition, Mercury Network runs an extensive set of quality control and compliance rules on the appraisal so users can correct any compliance issues before submitting it to the GSEs’ Uniform Collateral Data PortalSM (UCDPSM).

****By the end of the event the room was buzzing with news and new ideas. It was at this point that PROGRESS in Lending Association announced its own new. We have launched an industry app for the iPad that will truly bring about more industry advancement. This app is unique in that it doesn’t just display content from our company, it displays content from all industry participants as well. The app is currently following three different industry Twitter accounts, it includes 11 industry white paper, videos from lenders like the Provident Bank, and all the latest news and analysis from our company as well.

****Our goal was to bring together different forms of content in a variety of different media all in one place. We are now giving thought leaders and visionaries a platform to express their ideas in an increasingly mobile world. We encourage you to download this free app on iTunes today. What an event. We want to thank all of our sponsors, speakers and attendees for their support! In the end though, ENGAGE 2011 doesn’t have to be a single-day event, the spirit goes on every day in this new app and everything that PROGRESS in Lending does.

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.