What Is In Your Device: Best Practices For BYOD

Bring Your Own Device (BYOD) is not a new concept anymore, we hear this phrase day in and day out. Recently, the adoption of BYOD has grown significantly. According to a recent study by leading information technology research and advisory firm Gartner Inc., 40 percent of companies world-wide are actively encouraging BYOD. Companies have to be prepared for the pros and cons of BYOD and what it means to day to day business.

While BYOD has been around for a while, more companies are noticing the issues surrounding it because of recent data breaches and the growing number of employees working on their own devices. Gartner predicts by 2017, “half of employers will require employees to supply their own device for work purposes.” This includes desktops, laptops, tablets and smartphones.

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While BYOD has changed an industry’s economics with lower capital expenditure for hardware, it also poses many challenges, primarily privacy and security issues for the company and individual users.

With the increased use of BYOD, there is also an increase in data exposure or data breaches as device may or may not have applied to the company domain and security policies as company owned devices would be. With the growing BYOD use, company IT staff need to think of effective ways to set up additional controls to meet organizational demands, as BYOD will need dynamic capacity management to support company owned as well as BYODs in the longer run.

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Companies with BYOD practices need to address information security issues early in adoption. It is important for a company to align its policies and processes to effectively manage critical aspects of information security, such as confidentiality, integrity and availability (CIA) and risks associated with those areas so that the company’s data and security are not compromised.

Gartner also predicts that by 2018, the mobile workforce will doubled or tripled in size, hence creating challenges related to employee-owned devices that need to be aligned with a company’s confidentiality and privacy requirements. This will certainly affect IT support departments which will be tasked with balancing the support for company-owned devices support and employee-owned devices.

Gartner reports three-fourths of companies have cited security as the biggest concern related to BYOD programs. In addition, 23 percent of U.S.-based employees have experienced a compromise on their personal device in the past year, such as PC-based malware and hardware failures and 5 percent of smartphone and tablet users have reported compromised credentials, device failure and lost or stolen devices.

Recently the International Standards Organization (ISO) adopted 27001 (2013), an information security standard, has enhanced information security policy framework by focusing on having better controls for information security and risk management. This calls for revisiting existing policies related to information security, risk management and overall controls needed to support information security management systems for an organization.

An effective way to limit data exposure is to install data wiping software for every device that has been designated as BYOD. The following are guidelines companies should use when selecting data wiping software to limit BYOD data exposure:

  • Conduct market research on data wiping software;
  • Ensure the data can be termed as any file type (Microsoft Word, PowerPoint, text or PDF) supported by the device operating system, for example;
  • Search for software that wipe files, folders, drive, external hard disk, secure digital card (SD Card) and all types of files supported by the device operating system;
  • Determine whether the data wiping software has a provision for wiping original data securely with no trace and no possible recovery;
  • Ensure the data wiping software has the ability to produce log of data removed securely and be scheduled when needed;
  • Confirm the data wiping software has the capability to wipe data remotely for lost/stolen devices; and
  • Determine if the data wipe software is appropriate to support typical BYOD devices, including desktops, laptops, smartphones and tablets.

With data wipe software in place, a system administrators can follow these guidelines:

  • Review BYOD devices to ensure they meet compliance requirements;
  • Frequently wipe organizational data/folders from BYOD device drive, SD Cards or external hard disks so that data will not reside on BYOD device;
  • Set up auto wipe of recycle bins or regular temporary files or cache folders;
  • Review data wipe log at frequently; and
  • Implement policy that a remote data wipe will be performed when BYOD devices are lost/stolen, there is a termination of employment or security breaches.

In addition to the data wiping software, there are some best practices companies can implement that apply to BYOD. Along with implementing BYOD policies, companies should have an acceptable use policy in place to determine the types of devices can be used. Also companies should restrict the software and app installations on these devices and accessing blocked websites. IT support should assess a device’s compatibility to ensure it is running on a company approved operating system and that it has provisioning and standard applications’ configuration.

Some other BYOD best practices include:

  • Disabling photo or video recording facility per business needs;
  • Disabling USB devices per business needs;
  • Requiring employees to use company IT support instead of calling device manufacture;
  • Regularly reviewing the devices at nearest office location;
  • Requiring employees to report lost or stolen BYOD devices immediately to the company;
  • Restricting employee software or app installation except with approval from IT support;
  • Developing training programs to ensure BYOD security compliance and improve awareness; and
  • Reviewing employee NDA with special provision of confidentiality and privacy related to BYOD devices.

As BYOD matures, companies are learning how to successfully integrate them into their infrastructure without any security incidences. With the potential of having sensitive company data vulnerable to hackers or thieves, companies should take every precaution to prevent breaches. BYOD device should have data wipe software installed and registered for remote data wipe. Although these efforts do not solve all concerns, these small measures will help companies to apply some control to the BYOD environment.

About The Author

[author_bio]

Ramesh Devare is COO at IndiSoft LLC. Columbia, Md.-based IndiSoft is a global company that develops collaborative technology solutions for the financial services industry. Through various portals, IndiSoft’s RxOffice platform (patent pending) enables disparate parties to communicate and transact online in real-time. The transparent workflow technology improves the efficiency of business processes and offers audit, compliance and quality control capabilities to accelerate decision making and support business excellence.

Is Your Mobile Strategy Working?

Is your mobile strategy producing lackluster results? Here’s a look at five areas that might need improvement, according to the following Formstack infographic.

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Make sure your site is optimized for mobile. “Consumers today don’t have patience for poorly functioning mobile sites,” states Formstack. “Some 46% of shoppers are less likely to shop around for other options when they’re using a company’s mobile app.”

Moreover, consider providing a social autofill form. Some 77% of users prefer social logins over passwords.

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Also, make sure your social autofill form isn’t overwhelming your visitors. “If your forms are too long, your visitors will leave,” states Formstack. “Offering a social autofill not only reduces time on site, but it’s a sanity saver, too.”

To find out more about mobile mistakes and how you can fix them, check out the infographic.

five-mobile-marketing-mistakes-infographic

Progress In Lending
The Place For Thought Leaders And Visionaries

Tracking Your Return On Investment

Now that business intelligence has a foothold in the mortgage industry, we’re starting to hear more and more questions about return on investment. How do you know if you’re getting your money’s worth? How much should mortgage business intelligence (MBI) cost? Is the system paying for itself in increased revenue, or are you losing money?

Let’s be honest: the mortgage industry has always struggled with detailed cost analysis. I’ve talked to a number of lenders about how they analyze cost per loan. Many take aggregated quarterly or yearly totals from their accounting systems and then simply divide them by the number of closed loans in that period. Some don’t even go that far, literally shrugging off unit labor cost figures as unobtainable.

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But are they? Are loan level costs really that mysterious? Anyone that’s worked in loan operations understands this viewpoint. The journey of a loan file through operations is rarely linear, and the number of touches on a file and the time elapsed between touches is nearly impossible to track. You might be able to track a single file or group of files, but tracking them all consistently and accurately has been impossible until the advent of MBI.

MBI systems have finally given us the functionality necessary to closely track the lifecycle of each and every loan in a given pipeline. Imagine not only being able to quickly and consistently identify your most labor intensive loans, but also to easily trace common characteristics to find the source of these files such as a particular loan program, branch, or loan officer. You’ve just found an opportunity for pinpointed training and process improvement, or a strategic shift in product mix, either of which can reduce loan level costs.

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I recently had lunch with Todd Pierson, founder of The Mortgage Firm. He explained the return on his MBI investment this way: “It’s improved our ability to work. I don’t have to interrupt people anymore to get information. We have great workflow, good energy, and my key people are working in highest and best use mode all the time, without having to get distracted. How do you put a price tag on that?”

Any good technology provider will have a value assurance model, and superior MBI systems will include prebuilt dashboards and reports to monitor loan level costs using “field auditing” or “audit tracking”. This is the ability to track how and when a given data field has changed and who changed it, giving you a complete history of the values that have been entered into that field during the loan file’s lifecycle. These field histories provide the necessary data points to paint a much clearer picture of loan level costs.

If you’re looking for a simpler formula, ask yourself how many additional loans MBI is helping you close each month. If you’re closing a dozen or more additional loans per month with MBI, revenue from the first two or three of these should cover the cost of a well-priced MBI system.

About The Author

[author_bio]

Jon Maynell
Jon Maynell is a mortgage industry veteran, with over 25 years of experience designing, marketing, and writing about mortgage technology. He is currently Vice President of Client Services at Denver-based Motivity Solutions, Inc. He can be reached at 303-721-9000, or jon.maynell@motivitysolutions.com.

Read The Headlines Lately?

Just read the latest industry publications or open up your e-mail newsletters and you will see numerous headlines like: CFPB Hits Three Lenders as Part of False AD “Sweep”, Holder Asks Lawyers to Pursue Bankers in Mortgage Fraud Cases, CFPB Fines Lender $2M for Alleged Kickback Scheme, As Founder Is Pushed Out, Owen’s Future Is Cloudy. Here’s how you can stay out of these headlines:

As you can see, these are not flattering headlines.  This type of press can have an extremely negative impact on your business. When these type of stories are published many companies scramble and look to implement a “crisis management” or “reputation management” strategy.

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Crisis management is typically thought of as the process by which an organization deals with a major event that threatens to harm the organization, its stakeholders, or the general public. Reputation management normally is referred to as the influencing and/or control of an individual’s or business’s reputation.

The major problem that we typically see when companies are dealing with these situations is that they try to implement these strategies after the fact.  The first time that companies think about crisis management and reputation management is after the stories have run and after the reputation of their company and the individuals running it have already be run through the ringer.

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Proper reputation management should start long before an issue or situation ever arises.  Companies need strong communication strategies that enhance the reputation of their organization and its leaders before a problem arises.  They need to deliver thought leadership and valuable insights to the market in a genuine and proactive way.

Companies should never underestimate the cost of a poor reputation in this or any other marketplace.

About The Author

[author_bio]

Michael Hammond
Michael Hammond is chief strategy officer at PROGRESS in Lending Association and is the founder and president of NexLevel Advisors. They provide solutions in business development, strategic selling, marketing, public relations and social media. He has close to two decades of leadership, management, marketing, sales and technical product experience. Michael held prior executive positions such as CEO, CMO, VP of Business Strategy, Director of Sales and Marketing and Director of Marketing for a number of leading companies. He is also only one of about 60 individuals to earn the Certified Mortgage Technologist (CMT) designation. Michael can be contacted via e-mail at mhammond@nexleveladvisors.com.

Can We Talk?

Most people recognize “Can we talk?” as a catchphrase used by the late Joan Rivers. But it should be a phrase that lenders are asking of their business partners and borrowers. Many of the regulations and pilot programs introduced recently will fundamentally change the way that lenders will interact with them both.

Let’s start with the consumer. The Consumer Financial Protection Bureau (CFPB) is responsible to make sure the American consumer gets all of the information they need to make an informed financial decision when it comes to mortgages, credit cards or other types of consumer financing. To ensure borrowers are kept informed throughout the lending process, lenders are being asked to provide consumers with information and documentation from the point of sale through servicing the loan. Consumers must receive copies of their initial disclosures, appraisals, closing disclosures and documents, privacy notices and many others. The result is that consumers are becoming involved in the mortgage process as never before.

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To facilitate this new level of interaction with borrowers, many lenders are turning their static websites into interactive communication portals. Instead of just presenting information to a consumer or asking them to fill in a form or application, lenders are creating a two way dialogue with their customers. They are implementing tools such as: live chat where a consumer can electronically chat directly with a loan officer or help desk; secure messaging for communicating sensitive non-public personal information; document exchange where consumers can go to not only electronically view their documents, but also send documents back to the lender if necessary; and finally electronic signatures where borrowers can electronically sign and return documents with the click of a mouse or the tap of a screen. With today’s on the go consumer, these features need to be available not only from a consumers computer, but from their smartphones and tablets as well.

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But it’s not only borrowers that lenders need to step up their communications with. Business partners such as closing agents, attorneys and title companies are going to need additional attention as well. Starting in August of this year, the current Truth in Lending disclosure document and HUD-1 Settlement Statement will be combined into a single document known as the Closing Disclosure. Currently, in many cases the HUD-1 statement is not produced by the lender but rather by the closing attorney and is delivered to the borrower at the closing table. But since the HUD-1 is now included in the final Closing Disclosure, and the final Closing Disclosure is required to be provided to the consumer at least three business days prior to the closing, a new level of collaboration between lender and closing agents will be needed. By implementing a communication portal with secure messaging and document exchange, it will be much easier for a lender to streamline this collaborative process.

So the next time you deal with a consumer or business partner, maybe the first words out of your mouth should be “can we talk?

About The Author

[author_bio]

Brandon Perry
Brandon Perry is President at The Turning Point. Brandon oversees all operational and administrative activities of TTP. Brandon brings over 16 years of experience in various financial services industries to TTP which enhances the Company's ability to maintain it's position as industry leader in providing customers with an advanced marketing solution.

Will Integrated Disclosures Push E-Signatures Forward?

Mass adoption of e-signing has been the white whale for innovators in the mortgage industry for years, decades even. Now, with the Truth in Lending/Real Estate Settlement Procedures Act (TILA/RESPA) integrated disclosure requirements going into effect in August, electronic documents, signatures and transactions are going to have a significant advantage for the borrower and the lender alike.

Why will this specific compliance requirement finally push eSignatures forward? By embracing digital documents, the opportunity exists to streamline and refine the disclosure process leveraging electronic document technology to improve compliance reporting, reduce paper expenses and better meet the needs of borrowers who embrace digital documents.

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Reducing Defects, Cutting Time with Electronic Disclosures

The most important benefit of electronic transactions from a compliance standpoint is data integrity. Since an e-disclosure is accessible to all service providers in the mortgage chain, changes made in the system of record are automatically applied to the documents. It is impossible with an electronic transaction to have the data from the loan file be different from the data on the documents. This eliminates the number one source for loan defects.

From a legal perspective, the electronic documents offer more protection than paper documents. As the borrower reviews every page of the document, the system can keep a record of how long each page is viewed, verify signatures, and ensure files are opened and returned.

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From a time and cost-savings perspective, electronic documents also enable lenders to eliminate a large percentage of the manual effort of handling, processing and checking paper documents.

The new closing disclosure will be one of the most time-intensive parts of the mortgage workflow after August 1st of this year. Due to the timing requirements of the RESPA/TILA law, lenders must allow between six to eight days if using paper documents in advance of the closing.

If the documents are sent electronically and the borrower consents to receive them electronically, lenders can save up to three days off of that lead-time. There’s also value to the borrower due to having access to documents instantaneously and having more time to review.

Last but not least, e-disclosures cost lenders less money. Integrating all the documents into one digital platform will reduce the need for the expensive transportation, filing and storage services needed by paper disclosures. Decreased time in the process means less money spent on each loan.

Despite rumors to the contrary, lenders should not expect a delay or extension on the deadline. The new laws provide a natural incentive to look at adopting more electronic documents and signatures into the workflow. Now is the time for lenders to begin upgrading systems and offering electronic solutions to accommodate borrowers before the reform that goes into effect on August 1.

About The Author

[author_bio]

Scott K. Stucky is Chief Strategy Officer of Idaho Falls, Idaho-based DocuTech Corp. Since 1991, DocuTech has provided compliance services and documentation technology for the mortgage industry. DocuTech's software interfaces with leading loan origination systems (LOS) and enables mortgage professionals to generate documents locally. DocuTech manages and secures all information needed for a loan, guaranteeing accuracy, security and compliance. Stucky can be reached at scotts@docutechcorp.com. You can also learn more about DocuTech online at www.docutechcorp.com or on Twitter at @DocuTech.

The Crisis In Rental Housing

On March 9, Secretary of Housing and Urban Development (HUD) Julian Castro gave a speech before the City Club of Chicago that was astonishing – for all the wrong reasons.

In his speech, Castro lamented that the nation was experiencing an “affordable housing crisis” and noted that more than 7 million low-income households that are not on government assistance are paying more than half of their income on rent.

“That’s roughly equal to the number of people living in Chicago, Los Angeles and Dallas combined,” Castro said. “We are talking about folks who are spending so much of their precious dollars just to keep a roof over their head that they can’t invest in their children’s education or begin to build up savings.”

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Closer to Castro’s new home in the nation’s capital, the absence of affordable rental housing is particularly acute. A study released this month by the D.C. Fiscal Policy Institute found the availability of affordable rentals in Washington is virtually nonexistent. And while low-income families are experiencing significant financial woes in relations to housing – 64 percent of low-income Washingtonians pay half or more of their income to rent – that particular rental market was also creating havoc with the more prosperous residents.

“In 2013, the typical middle-income renters earned $46,000 a year, a gain of $4,000 since 2002,” the study said. “However, this gain was outstripped by rents for moderate priced unites that rose almost $5,000 per year, from $900 to $1,300 monthly. For D.C. households in the middle, typical rents are about 34 percent of average income … Rents also rose for apartments in the upper half of the city’s rental market. But the gains in income were higher than the rent changes. For example, rents at the highest end of the market rose from $2,045 a month to $2,700 an increase of $7,900 a year. Average income for this group rose by $14,000.”

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Indeed, the lack of rental units is a problem impacting everyone from the low-income to those that display the outward signs of financial stability.

“We need 300,000 to 400,000 new apartments each year just to keep up with resident demand, yet we’ve chronically under-built for years during and after the Great Recession,” said Daryl Carter, chairman of the National Multifamily Housing Council and CEO of Avanath Capital Management, in a press statement released earlier this month. “For example, in 2013, we completed 186,000 units, which is only about half of what was needed to meet resident demand for that year alone. After bottoming out in 2009, apartment starts have increased nationally almost to the point of meeting annual demand, but the lengthy development process and years of backlog mean that completions aren’t likely to hit the necessary level for a couple of years. This increase of available apartments will also help address affordability challenges that we see in many markets across the U.S.”

What Carter did not say was that multifamily housing is now in great supply because so many people cannot qualify for mortgages thanks to the Dodd-Frank Act. But for low- and moderate-income individuals that would rather leave their rentals and their own homes, the stagnation in wages and the miserable nature of the post-2008 recovery (with its wealth of poorly-paying jobs) is making homeownership all but impossible at this time.

But back to Castro. In his speech, he acknowledged that there was a $26 billion backlog in repairs needed to the nation’s public housing and that 10,000 public-housing units were disappearing annually due to disrepair. And what can HUD – and, by extension, the Obama Administration – doing to fix this crisis?

“The cold, hard truth is that federal dollars are scarce and won’t be able to fully address these issues any time soon,” Castro said.

Uh huh. Let’s get this straight – after being in power for a little over six years, the Obama Administration’s initial promises of fixing the U.S. economy and improving the lives of the American people has resulted in a housing situation that the HUD secretary calls a “crisis,” but the White House is not taking any leadership role to fix this mess because they insist that there is absolutely no money to devote to this matter? Not one dollar? Nada, zilch, naught?

At no point since January 2009 has the Obama White House made any effort to show leadership in housing policy. While Castro deserves some degree of credit for admitting that the state of rental housing is a disaster, the fact that he cannot or will not agitate for the delivery of something resembling a solution is a testament to his irrelevance as a bureaucrat and his superior’s incompetence as a president.

About The Author

[author_bio]

Phil Hall has been (among other things) a United Nations-based radio journalist, the president of a public relations and marketing agency, a financial magazine editor, the author of six books and a horror movie actor. Also, as you will discover, he is not shy about stating his views.

The Hottest Markets

Spring is here. To usher in the season, Auction.com, LLC, the nation’s leading online real estate marketplace, today released its ranking of the hottest major single-family housing markets based on current and expected future housing fundamentals. Among the 49 largest U.S. markets, the top five include Denver, San Antonio, Nashville, Tenn., Fort Lauderdale, Fla., and Dallas, all of which display rising home prices, favorable affordability, strong housing demand, and excellent economic and demographic conditions pointing to future demand.

“As the U.S. housing market has continued to recover from the Great Recession, we’ve seen significant regional variances in terms of both price appreciation and sales volume,” said Auction.com Executive Vice President Rick Sharga. “Earlier in the recovery, most of the growth came from markets that had suffered the biggest declines during the housing bust, but what we’re seeing today is more in line with fundamental economic trends: markets with the best job growth and population growth are recovering most quickly.”

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According to the report, the Southwest remains the strongest U.S. region overall, with robust local economies and strong population growth continuing to drive housing demand. The Southeast and West also show promise, as even previously hard hit housing markets in these regions are improving rapidly.

Top Market Highlights

Denver

Denver’s housing market remains among the most robust in the Nation, as a booming local economy continues to drive demand. Employment in Denver is currently at a new record peak – 4.3 percent above its year-ago level – and its population is rapidly increasing, growing at a pace almost triple the national average. As a result, home prices have been appreciating at a torrid pace since mid-2012, hitting a record high in late 2014 on the heels of a 9.3 percent year-over-year growth. With a bustling local economy producing jobs and a burgeoning population base, housing demand is expected to continue to drive prices up even further over the coming years.

San Antonio

San Antonio’s favorable economy, growing population and exceptional affordability has given rise to gradually increasing sales – up 5.5 percent over the past year – and home prices are currently at their all-time peak, appreciating 4.3 percent over the past year. The metro’s population grew 2 percent in 2014, on par with its historical average and marking the fastest rate of expansion in three years. Its local economy continues to post solid fundamentals, with more than three years of uninterrupted employment gains and 8,000 jobs added over the past two months. Unemployment in San Antonio is low, measuring 4 percent in early 2015, and its economy is diversified across multiple industry sectors, lessening the potential impact of declining oil prices in Texas.

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Nashville

Nashville is one of the faces of the new South, driven by education and health services, tourism and a vibrant downtown that is attractive to millennials. Its economy is booming, as local employment has expanded in 12 of the past 14 months, and its population has seen accelerated growth in each of the past four years. Nashville’s housing market has maintained a strong performance and home sales are up 4 percent from a year ago. Increased demand – which is expected to continue over the next few years – has spurred a 6.2 percent year-over year increase in prices.

Fort Lauderdale

Fort Lauderdale’s top five ranking is particularly noteworthy, considering this market’s significant decline brought on by the recession. With a population growth of 1.3 percent in 2014, Fort Lauderdale’s demographics remain strong and stable. Employment has expanded by 4.2 percent over the past year – among the fastest growth rates of all large U.S. metros – and all of the 100,000 jobs lost during the recession have been recouped. Sales have regained their footing and median prices have increased 7.8 percent over the past year. Although they have a way to go before reaching their pre-recession peak, current prices represent a healthier, more affordable range for this market. Given Fort Lauderdale’s low permitting activity and improved local economy, its single-family demand should continue to bounce back over the coming years, driving prices up further.

Dallas

Despite plummeting oil prices, Dallas’ economy remains as strong as ever. With consistently strong gains over the past year, its total employment increased 4.5 percent – and the metro has added more than 20,000 jobs in the past two months alone. Home sales are currently at their highest level in seven years and prices have been rising consistently since early 2012, increasing 26.4 percent over that time period and showing 7.3 percent growth within the past year. While some economic slowdown is expected due to low oil, Dallas’ local economy is diversified enough to hedge against any serious repercussions. Boasting favorable affordability and steady demand, home price appreciation should prevail over the next few years, albeit at a more modest pace.

Market Rankings and Methodology

“Auction.com regularly monitors the nation’s largest 49 housing markets, tracking metrics which include existing home sales, existing home prices, affordability and development activity,” noted Auction.com Chief Economist Peter Muoio. “We pay close attention to the economic and demographic trends in each of these metro areas, as single-family housing markets are naturally intertwined with the overall health of the local economy.”

Sales and pricing activity on the Auction.com platform provides real-time insight into buyer demand and price appetite, particularly among real estate investors. Combining past and current trends with its economic and demographic growth forecasts, Auction.com ranks each of the largest 49 metros for performance potential. While rankings in the top 10 indicate a strong, healthy market with favorable potential over the coming years, those closer to the bottom indicate poor current housing conditions, declining home prices, subpar demand and a weaker outlook.

About The Author

[author_bio]

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 Type Of Industry Event

On April 7th, in beautiful New Orleans, Mercury Network hosted the first Techlab@CRN in conjunction with the Collateral Risk Network’s quarterly meeting. Techlab@CRN was an interactive, invitation-only meeting amongst experts in the valuation vendor management industry, with the objective of gathering expert feedback on the design and function of the new tools Mercury Network is planning, well before they’re released to world.

Why is this event, and others like it, important to the industry at large? With market challenges and the onslaught of new regulations, we desperately need innovation that empowers mortgage lenders to maximize their profits and ensure compliance. We can do incredible things through technology, and help mortgage lenders gain market share and be more successful – but only if it’s technology they want to use.

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We’ve learned first-hand that labs like these, where you can get invaluable industry opinions on software designs early in their development, are critical to successful innovation.

Through our participation with PROGRESS in Lending Association’s Lender Advisory Panel, we’ve already seen the benefits. Every year at MBA Annual, PROGRESS offers the opportunity to sit down with their Lender Panel for a 90-minute meeting, to get their unfiltered opinions on anything we ask. The specific, concrete takeaways from those labs (we’ve done it three consecutive years now) are unbelievably valuable and have directly impacted Mercury Network’s success. That’s why we’re very excited to launch Techlab@CRN to open even more feedback channels.

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This focus on the customer’s opinions early in development doesn’t just work well for Mercury Network. Every technology company should be seeking early feedback on software design. Steve Blank has an article in Harvard Business Review that does a great job of explaining how the customer-focused methodology works, and how it will help companies successfully innovate rapidly to better serve their customers and become far more successful.

PROGRESS readers are probably already aware of the design revolution inside many of our industry’s technology companies. In our digital age, everyone knows that a technology company can’t just have great marketing and excellent sales people. Since anyone with an Internet connection can find out what their peers really think about various software solutions, the product has to speak for itself. Poor software design, no matter how powerful the tools behind it are, will break even the best façade built by marketing and sales, in a matter of seconds.

The good news is that customer-focused, well-designed software is already proving to outperform older methodologies across virtually all industries. Check out the recent Design in Tech Report published this month at SXSW.   Design-driven technology companies are surpassing others because they’re designing software that solves people’s problems, that real people want to use.

That’s our objective for Techlab@CRN. We’re excited to see what the experts at our inaugural meeting think about the appraisal management, quality control, and appraisal compliance tools we’re building. Rest assured, we’ll listen closely, implement their feedback, and continue to release powerful solutions that collateral risk managers want to use.

About The Author

[author_bio]

Molly Dowdy
Molly Dowdy has nearly 20 years experience marketing in the mortgage technology space and is the co-founder of NEXT, the mortgage technology conference for women executives. Molly is also a member of the PROGRESS in Lending Association Executive Team. She can be reached at molly@Nextmortgageevents.com.

A More Convenient Mortgage Process

We hear continual discussion around the automation of mortgage lending processes, but widely understand that a fully online, or e-mortgage process, is still a ways off. Despite the complexities that continue to hinder the e-mortgage from becoming a reality, many industry organizations have made significant strides to move away from paper-based processes and wet signatures and enter the digital present. This effort is largely driven by the fact that electronic transactions are much more prevalent in our daily lives, whether this means signing a document or paying a grocery bill. The use of an electronic signature pad at a cash register has become common for most, and now with Apple’s iPay and other payment technologies, it has become ubiquitous. As consumers enlist more technology tools, devices and apps to make their lives easier, they will expect the same level of convenience when it comes to the lending process – making these efforts to adapt all the more important.

The complexities of the mortgage industry and today’s era of compliance have certainly added challenges to the adoption of electronic, paperless processes, and understandably so. Many organizations have taken on the mindset that a single document that requires a wet signature poses the risk to perpetuate the paper process. For example, the Social Security Administration still requires a wet signature on the SSA-89. However, the industry as a whole should be motivated by the acceptance of electronic signatures by key parties in the industry, such as investors, the Internal Revenue Service (IRS), the Federal Housing Administration (FHA), United States Department of Agriculture (USDA)/Rural Housing Service (RHS), and Department of Veterans Affairs (VA).

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Many industry participants are beginning to see that electronic documents and signatures actually promote security and compliance rather than add risk. The Consumer Financial Protection Bureau’s deployment of its mortgage eClosing pilot earlier this year seeks to assess the true value of electronic processes within the closing process. The hope is that this pilot will further exemplify and support the value of automation for lenders needing to provide proof of consent and delivery to remain compliant. Additionally, when timeframes for delivery are required for certain documents in the origination process, the use of electronic signatures will make compliance a seamless process.

One of the primary security considerations mortgage companies are making when it comes to e-signature technology is third party authentication. It is critical to ensure that electronic documents are signed by the right people at the correct times (or in the correct order), including additional parties involved in the process outside of the borrower and the lender, such as notaries. To eliminate signature verification concerns, a system should be more than a basic signature field overlay; to reduce fraud, electronic signatures must be physically embedded (with a tamper-evident seal) into the document and capable of being systematically verified and validated. Lastly, all related data and an audit trail need to be embedded, following every document to provide evidence of who took which action on each form. In addition to the lenders, due to their own compliance concerns, investors are requiring this electronic proof as well to pass future audits.

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These concerns are not going unnoticed, but technology providers and other industry organizations are making a significant effort to address them in various ways. Any technology enlisted should first and foremost ensure that all legal documents are tamper-evident sealed and e-signed within a secure SSAE-16 environment. Also, delivery of the documents simply via email is not enough; encrypted security should be wrapped around documents to authenticate both the sender and recipient and fully track the delivery.  Finally, a true eClosing will require an eVault to ensure the security, sanctity and integrity of the data, documents, signatures and security wrappers.

The beauty of electronic signature is that from initial application all the way to delivery, there is a virtual date and time stamped audit trail marking every significant event in the mortgage process. It is extremely difficult to replicate a paper trial this detailed, where misplaced documents, missing pages and signatures are still commonplace and endemic.

As electronic signature and records become more prevalent, there is no doubt of their need in the business world, and in particular, the mortgage industry. The technology is in place. The need is evident. And the desire is there from both consumers and industry professionals. In 10 years I believe we will see more than 85 percent of mortgages being completed electronically for many reasons, including compliance, convenience and consumer preference. With the amount of time all mortgage companies have invested in updating their processes, policies and technology to accommodate the ever-changing landscape, the establishment of a true e-mortgage, used across the board, would certainly prove beneficial for everyone.

About The Author

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Melanie Feliciano is a 2014 voluntary board member for the Electronic Signature and Records Association (ESRA), the premier trade association representing electronic signature adopters and providers, She is chief legal officer for Carson, Calif.-based DocMagic, Inc., a provider of solutions for the national mortgage industry’s most pressing document production needs. In her role as chief legal officer, she manages the Legal and Compliance Department, oversees, negotiates, and prepares various agreements involving DocMagic’s customers and strategic partners; manages DocMagic’s risk; and handles legal matters.