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.

The Future Of Digital Mortgage Technology Innovation

High-powered mortgage executives gathered at the Seventh Annual ENGAGE Event in Denver, Colo., to discuss the future of the mortgage business. The discussions that happened were both lively and informative. Here’s how they see the future of digital mortgage technology innovation:

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“We have to move this industry forward by streamlining the process, and cutting the cost to originate,” said Michael Hammond, Chief Strategy Officer at PROGRESS in Lending Association and the Founder and President of NexLevel Advisors. NexLevel provides solutions in business development, strategic selling, marketing, public relations and social media. “This is far more then just hype. This is something that the industry has to do and it is not just about one technology or one platform, it is about coming together as an industry.”

Neil Fraser, Director of U.S. Operations at Paradatec, believes that this will be an evolutionary process. “You don’t need a revolution to convert the document into data that you can believe. You need technology to read the documents, and convert that to data that can be both read and understood. I see that as an evolutionary step in mortgage technology innovation.”

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Paradatec is a mortgage OCR technology organization that automates the data entry operations of large lenders through intelligent document analysis. Neil was Paradatec’s first U.S. employee and has grown the organization every year since the company incorporated here in 2002.

As the mortgage industry embraces innovation to become more digital, everything starts at the point-of-sale. Realizing this fact, a lot of new POS vendors have emerged claiming to offer the true digital mortgage experience. Curt Tegeler, President of WebMax, warns lenders not to be fooled by vaporware as they march toward more digital processes.

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“There’s a lot of buzz today around the digital POS. Why is that? We’ve found that 90% of homebuyers start the process online,” Tegeler notes. WebMax’s digital lending platforms expedites the borrowing process, helps maintain compliance, delivers dynamic online lending tools, and provides a highly innovative borrower experience. “Make sure that the executives behind your POS have deep mortgage experience. You have to understand the market so you know what you’re fixing.”

One area that everyone agrees needs fixing is the appraisal process. If the industry is going to move to a more data-driven process and a fully automated point-of-sale, slower processes like the appraisal need to be addressed.

“Appraisals were really left on the side,” noted Arturo Garcia, the Senior Vice President of Account Management at Mercury Network. He leads all customer retention efforts and strategies for the company, responsible for continuous improvements and increased returns for customer investments and overall satisfaction. “Appraisals didn’t get a lot of attention. However, it’s antiquated to send an appraiser out to the field time and time again. I envision a day when you have a system that can automatically flag issues with the appraisal, fix them or send them right back to the appraiser for fixing.”

The big takeaway from this discussion was that the digital lending process is coming and must touch all parts of the mortgage process in order to make a difference in how loans are done.

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.

Wholesale Lender Automates To Expand Business Growth

MORE Lending has implemented Portfolio Producer from LoanScorecard as its automated underwriting system (AUS), product and pricing engine (PPE), and distribution solution. Here’s why:

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MORE Lending is the wholesale division of Synergy One Lending, a San Diego-based mortgage lender. Licensed in 42 states, MORE Lending offers a variety of non-agency loan products, including program options for foreign nationals, interest only, non-warrantable condos, and recent credit events such as deeds-in-lieu, short sales, and foreclosures.

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Portfolio Producer is a sales distribution system that integrates with LoanScorecard’s AUS, Portfolio Underwriter, and PPE, Pricer1. It provides third-party originators (TPOs) access to a wholesale lender’s product and pricing options from within their loan origination system (LOS) or via the wholesale lender’s website.

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Using Portfolio Producer, MORE Lending will be able to instantly distribute the guidelines and pricing for their non-agency loan programs to TPOs via Calyx Point and their website. TPOs can search based on borrower profile, product type, rate and price to provide eligible products and pricing options to potential borrowers. If they like an eligible product and fully-adjusted price, TPOs can run “upfront decisioning,” and get back an in-depth Findings Report. The report provides an early indication of the likelihood that MORE Lending will approve the loan and reduces the likelihood that the TPO will provide inaccurate quotes to the borrower.

“Our goal is to provide the broker community with an automated solution that allows them to learn about our non-agency, non-QM offerings and gives them greater confidence when sharing these financing options with their borrowers,” said Steve Majerus, President of MORE Lending. “LoanScorecard’s Portfolio Producer, combined with our first-class customer support, helps us differentiate our company among brokers and provide them with more options for their borrowers.”

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.

Are You Prepared For The Digital Lending Revolution?

You Need To Attend This Event To Be Ready. RSVP TODAY!

To all mortgage lenders and companies that sell products or services to the lending community this is one event you cannot afford to miss. While you are attending the MBA Annual Conference in Denver you should also attend this premier networking and information-gathering event. The Seventh Annual ENGAGE Event will deliver key insights into: the most effective ways to be ready for the digital mortgage lending process of the future, how to reach today’s borrowers, detail how digital processes will reshape regulatory compliance, explore the future of digital mortgage technology innovation, and much more.

Gain strategic insights that quite frankly you can’t get anywhere else. If you are serious about advancing your digital footprint to get a competitive edge, improving your sales results and truly understanding buyer behavior then this one-of-a-kind event is one you can’t afford to miss.

Don’t miss out. This event will take place from 2:30 p.m. to 4:30 p.m. at the Curtis Denver located at 1405 Curtis Street, Denver, Colorado 80202 on October 22, 2017. This is the time to engage, be enlightened and excel with PROGRESS in Lending Association as we look to the future of digital mortgage lending. Admission to the event is free.

RSVP NOW!

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The Place For Thought Leaders And Visionaries

Getting More Business

There is a lot of talk about how to get more business. Specifically, more and more lenders are using technology to reinvent the point-of-sale, but that’s not enough. To go further, the industry has to come together to stretch beyond just the point-of-sale. Here’s one way to start that dialogue:

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Join the California MBA on October 3rd at 11 am (PST) for a FREE webinar: “Learn to Win More Opportunity and Close More Loans,” presented by the California MBA’s Mortgage Technology & Marketing Committee (MTAM).

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This FREE webinar will cover the following topics: How to convert attention into interest, present with power, and elevate your skills.  Presenters include Greg Pettersen, Marketing Manager, Residential Wholesale Mortgage, Inc.; and Bill Bodnar, SVP, Sales, Vantage Production, and John Seroka, Committee Chairman, Seroka Brand Development.

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The URL link to register for the webinar is: https://attendee.gotowebinar.com/register/8659706686770656001

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.

Making AVMs Even More Reliable

Mercury Network’s OptiVal Automated Valuation Model (AVM) Cascade has expanded to include HouseCanary’s AVM. The addition of HouseCanary brings yet another AVM to the Cascade to assist lenders in reducing risk and maximizing profit.

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The OptiVal Cascade now contains twelve AVMs, and is the only independent and objective Cascade that evaluates multiple AVMs to select the most accurate for a particular piece of real estate. OptiVal is updated every 90 days with the highest quality data representing the most recent sales – months ahead of county recordings and other data offerings.

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Mercury Network’s technology is used by nearly 1,000 of the nation’s lenders and appraisal management companies (AMCs) to manage real estate valuation operations and collateral risk. “We’re proud to be selected for the OptiVal Cascade,” said Chris Stroud, Chief of Research at HouseCanary. “Lenders need easy access to highly accurate data to mitigate risk and HouseCanary’s AVM has an excellent history of pinpointing property values. Objective testing will make our AVM more accessible to lenders when they need it most.”

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“The OptiVal Cascade is an independent test of multiple AVMs against the freshest test data available on the market today,” said Craig Zielazny, VP of Data and Analytics at Mercury Network. “Our objective is to include all the AVMs that lenders are interested in using, and providing them with the specific performance for a particular AVM in the subject property’s area. We’re pleased to welcome HouseCanary to the OptiVal Cascade.”

Founded in 2014, HouseCanary’s mission is to help people make better real estate decisions. Built on a foundation of great data, powerful models, and predictive analytics, the HouseCanary platform aggregates millions of data elements, including more than four decades of property data and a rapidly expanding arsenal of proprietary calculations and analytics, to accurately define and forecast values and market influences.HouseCanary is financed by notable investors including Hillspire (Alphabet Executive Chairman Eric Schmidt’s family office), PSP Growth/PSP Capital (firm founded by entrepreneur and former Commerce Secretary Penny Pritzker), Alpha Edison, ECA Ventures, Raven Ventures and others top Silicon Valley investors. The company is headquartered in San Francisco.

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.

Yes, Lenders Are Moving Toward A Digital Mortgage

There is a lot of buzz around the digital mortgage, but are lenders really interested in this strategy? The answer is: Yes. For example, Desert Schools Federal Credit Union (Desert Schools) has deployed the Loan Fulfillment Center from Mortgage Cadence, an Accenture company, to help support its goal of a fully digital loan origination process.

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With the deployment of the Mortgage Cadence product suite, Desert Schools — the largest credit union in Arizona and a top 25 mortgage-producing credit union in the United States — is now creating an unprecedented experience for its customer base of more than 300,000 members.

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“After considering various options, we found that Mortgage Cadence’s technology offered the most streamlined functionality, enabling us to quickly implement an end-to-end solution to support mortgage originations from application to closing without ever leaving the system,” said Gary Sneed, Desert Schools’ chief lending officer. “Mortgage Cadence helps us further our commitment to our members by providing a quick, easy-to-use borrower portal that allows for product comparisons and ongoing member education. Thanks to the close collaboration of our teams, we were able to go live on the system swiftly and capitalize on the benefits this functionality brings to our digital mortgage strategy.”

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Mortgage Cadence’s Loan Fulfillment Center — in coordination with its intuitive Borrower Center, Secondary Market Center, Document Center and Imaging Center — provides the tools necessary for Desert Schools to establish a transparent, compliant and efficient mortgage origination process. The product suite walks prospective homebuyers through the mortgage application process step-by-step and enables clients to provides loan status and other information related to the borrower’s loan application via tools within the platform.

With the Loan Fulfillment Center, each step of the process — from processing, document imaging and package creation to underwriting, post-closing and secondary marketing — continues on-platform and through a single system.

“The future of the industry belongs to innovative lenders who are dedicated to taking steps toward the all-digital mortgage, said Nizar Hashlamon, Mortgage Cadence’s executive vice president of sales. “As an industry-leading institution, Desert Schools Federal Credit Union recognized this and positioned themselves to provide an unparalleled experience for their members for years to come. We are proud to support and help fuel their growth by providing Desert Schools with the type of forward-thinking, intuitive member and lender tools that enable ongoing success.”

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.

Refinances Remain Steady With Slight Uptick In Interest Rates

The percentage of refinances remained steady at 35 percent of total loans, despite a slight uptick in interest rates according to the August Origination Insight Report from Ellie Mae. Additionally, overall closing rates climbed to 71.7 percent, the highest since January of 2017 and up from 70.6 percent in July.

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“As the summer season drew to a close, refinances held steady at 35 percent of all closed loans coupled with a slight increase in interest rates to 4.27, up from the 2017 low of 4.25 in July,” said Jonathan Corr, president and CEO of Ellie Mae.

Other statistics of note in August included:

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>>The percentage breakdown of all closed loans remained steady for the third consecutive month with conventional loans representing 64 percent of all closed loans, FHA loans representing 22 percent of all closed loans, and VA loans representing 10 percent of all closed loans.

>>While the average FICO score on all closed loans remained steady at 724 in August, average FICO scores for FHA refinances increased three points to 649. The average FICO score for conventional purchase loans decreased to 752 in August and FICO scores for VA refinances increased two points to 702, up from 700 in July.

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>>Closing time for all loans fell to 42 days in August. Time to close a refinance decreased to 41 days, down from 42 days the month prior. Time to close a purchase loan remained at 43 days in August.

The Origination Insight Report mines data from a robust sampling of approximately 80 percent of all mortgage applications that were initiated on the Encompass all-in-one mortgage management solution.

In addition to the Origination Insight Report, Ellie Mae also distributes data from its monthly Ellie Mae Millennial Tracker on the first Wednesday of each month. The Ellie Mae Millennial Tracker focuses on mortgage applications submitted by borrowers born between the years 1980 and 1999.

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.

Compliance Expertise Is In High Demand

Compliance experts are being sought out. For example, for over 35 years, Dallas-based MRG, a mortgage banking compliance organization, has provided to the mortgage industry at large a blend of compliance, document preparation and technology, products and services. To this end, MRG compliance expert Marsha Williams has been asked to share her extensive compliance expertise at the following upcoming industry events:

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Texas Association of Bank Counsel Convention – Bastrop, TX – September 20 – 22

“What’s Happening in Residential Mortgage Lending?”

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MBA Risk Management, QA & Fraud Prevention Forum – Miami, FL – September 24 – 26

“Construction Lending”:  Compliance and Risk Management”

In today’s constantly changing regulatory environment, MRG’s compliance expertise is in high demand. MRG’s team of compliance experts recognizes the business imperative of proactively monitoring and continuously analyzing regulatory changes, trends, and impending regulations that impact your business. MRG’s team of professionals is constantly on alert for changes from all federal, state, local and investor requirements to provide lenders with up-to-date compliance insights.

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As a lender, you should be focused on generating and maintaining a profitable business in this volatile market, rather than constantly worrying about the enormous and ever-changing regulatory landscape. Your burden is too great, and the risk is too high to rely solely on your internal staff to provide legally defensible compliance.

As a result lenders should turn to the experts that other leading providers and industry sources trust like MRG and others.

About The Author

Progress In Lending
The Place For Thought Leaders And Visionaries

Vendor Releases Innovative Web Services API

Paradatec, Inc., developer of an Optical Character Recognition (OCR) solution for mortgage file processing, has released their web services API for real-time integration to their clients’ line-of-business applications. This new functionality can seamlessly transfer documents from the loan origination system (LOS) to the Paradatec solution for page classification and data extraction, with the Paradatec-produced results transferred back to the LOS in place of manual data entry.

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“As application integration becomes tighter in response to the ongoing compression of service level timeframes, Paradatec’s new web services API stands ready to serve as the OCR extension to our clients’ line-of-business applications. Our first solution to leverage this capability is our new WriteUCD module, in which the final Closing Disclosure (CD) is submitted to us through the web services API, our OCR functionality extracts the relevant data from the CD, and WriteUCD then produces the corresponding Uniform Closing Dataset (UCD) file required by Fannie Mae and Freddie Mac” said Neil Fraser, Paradatec, Inc.’s Director of US Operations.

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“This new functionality allows for seamless OCR processing scaling from small document sets like borrower-provided paystubs and W-2s up to full loan files. With the ability to integrate tightly with any other web service-enabled application, we’re helping our clients create a very rich and efficient application ecosystem.”

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Paradatec’s OCR solutions offer significant efficiencies for classifying large quantities of differing document types and extracting key data elements from those documents.  In the mortgage market, these capabilities allow for the quick and accurate identification of over 500 unique documents in the typical mortgage file, along with capturing nearly any data element from those documents that an organization requires.

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.

Paradatec Named Verified UCD Producer By Freddie Mac

Paradatec, Inc., a provider of Optical Character Recognition (OCR) solutions for mortgage file processing, announced that it is a verified technology integration vendor for Freddie Mac’s Loan Closing Advisor platform. Paradatec’s WriteUCD module was developed in accordance with Freddie Mac’s requirements for producing valid Uniform Closing Dataset (UCD) files.

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The UCD is a common collection of data that mortgage lenders will be required to deliver digitally to Freddie Mac and Fannie Mae starting on Sept. 25, 2017. This requirement is part of the Uniform Mortgage Data Program (UMDP), an industry-wide drive to build a better housing finance system in the United States.

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The WriteUCD module leverages Paradatec’s advanced OCR solution for the mortgage market to extract data from closing disclosure (CD) documents in mere seconds per page and then format that data in the required format.

According to Neil Fraser, Paradatec’s Director of US Operations, “We’re pleased to have obtained Freddie Mac validation as our clients need the assurance that they can meet the GSEs’ requirements well in advance of the September deadline. If a lender’s current loan origination system partner or document provider is struggling to produce a valid UCD file, they can sleep soundly knowing that Paradatec has them covered with our new WriteUCD module.”

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Paradatec also announces the release of their new AuditUCD module for auditing UCD file content against the closing disclosure contained in the UCD file. Fraser continues, “Since we’re building the UCD file from extracted closing disclosure data, it’s just as easy for us to unpack a UCD file’s content to compare the individual data elements against the values extracted from the submitted CD to verify the integrity of both components in the UCD file. Any elements that don’t match will be flagged in our XML output for further review and resolution. Given the volume of content that will be produced and need verification with this UCD initiative, our solution is uniquely positioned to offer a high degree of automation and operator efficiency.”

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.