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Automated Underwriting Of Portfolio Products Allows Lender To Expand

Cascade Financial Services (Cascade) has implemented LoanScorecard’s Portfolio Underwriter as its automated underwriting system (AUS). Cascade is an independent mortgage bank that specializes in manufactured and modular home financing.

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In May 2017, the company was named Regional Lender of the Year for the third consecutive year by the Manufactured Housing Institute, the national trade organization representing all segments of the factory-built housing industry. Cascade was founded in 1999 in Arizona and is currently licensed in 38 states, with plans to expand to the contiguous 48 states by the end of 2017.

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Cascade’s unique portfolio loan products include both land/home and home only loan options for manufactured home buyers. With Portfolio Underwriter, Cascade’s guidelines for these products can be captured within the engine to deliver a rules-based underwriting decision in seconds. Results of the decision are documented in an in-depth findings report, which includes the program-specific, conditional underwriting criteria used in the data analysis. This allows Cascade to automate underwriting its portfolio loans and manage exceptions based on valid compensating loan factors, rather than loan officer “discretion.” It also ensures consistent, transparent credit policy application to demonstrate Fair Lending.

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“Having an AUS to provide quick and consistent underwriting decisions on portfolio loan products is a very important part of being able to scale a business. And building an internal system that is intelligent enough to read credit reports and interface with an LOS takes significant time and upfront expense,” said Gerron Dover, Executive Vice President of Production at Cascade. “We selected LoanScorecard’s Portfolio Underwriter because it works seamlessly with our LOS, it was relatively quick and inexpensive to get set up, and it is now providing us the efficiency we need to offer our portfolio loan products on a more expanded scale. It also provides us the ability to quickly revise system parameters as we get more experience with our new loan products, and our lending guidelines evolve over time.”

“Manual underwriting is time consuming, costly, and puts lenders at risk for Fair Lending violations,” said Ben Wu, Executive Director at LoanScorecard. “That’s why more and more forward-thinking portfolio lenders, like Cascade, are turning to sophisticated automation. By using Portfolio Underwriter, they’re able to not only automate underwriting for their unique portfolio products, but also reduce errors, improve efficiency, and expand their manufactured housing finance business.”

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.

Lender Selects New AUS For Jumbo Product

New Penn Financial, Plymouth Meeting, Penn., a leading national lender, has selected LoanScoreCard’s custom underwriting engine, Custom AUS, for its non-agency loans. LoanScoreCard’s Custom AUS is an automated underwriting solution that allows lenders to customize credit decisioning and safely originate compliant assets. The system delivers an underwriting decision and provides an assessment report that includes a breakdown of every rule applied and whether the loan passed or failed a particular guideline—creating an audit trail for underwriting and ability-to-repay decisions. It also accommodates third-party origination programs and helps ensure consistent, transparent application of credit policy.

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Founded in 2008, New Penn Financial is a ShellPoint Partners Company and is licensed in 48 states. The company offers a full line of mortgage finance products including government, conforming, jumbo, non-QM and HARP loans. In 2015, New Penn originated over $7 billion.

“LoanScoreCard’s Custom AUS will help us underwrite our jumbo, non-agency loans in a timely and efficient manner,” said Terri Merlino, chief credit officer at New Penn. “Underwriting these loans manually meant that just one loan could take hours. We needed a solution that could keep up with the increased volume and demand, and free up our underwriters’ time to focus on the more complex transactions.”

“LoanScoreCard’s Custom AUS is designed to increase efficiency and accelerate the origination and investment processes,” said Ben Wu, executive director at LoanScoreCard. “At the same time, it helps assure compliance and creates

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Market Analysis: What Happens After The Acquisition Closes?

*What Happens After The Acquisition Closes?*
**By Tony Garritano**

***At least twice a year, more so these days, I hear about a big mortgage technology acquisition. Quite frankly I was expecting to hear about more these past few years given market conditions, but I’ll be sure to keep you posted on what I know when I can. As I look at these deals I think some times that deal was great and it made perfect sense. However, some times after the deal is done there’s poor execution in making that acquisition a value add for the industry as a whole. I’m happy to say that this one acquisition done last year made perfect sense to me and I just heard today that the acquiring company’s ability to turn that deal into a win for the industry has now happened as well. Here’s the scoop:

****Following the acquisition of Loan-Score Decisioning, Calyx Software has launched the Calyx Decisioning Systems suite of products. LoanScoreCard provides competitively priced FHA Total Scorecard access directly through the Calyx Point tool as well as through other loan origination systems (LOS). The Calyx Decisioning Systems is a suite of automated underwriting and pricing products designed to help you determine a loan’s eligibility and pricing within investor or FHA guidelines. Fully integrated with Point, the decisioning system saves time, reduces cost, and improves the quality of each loan’s eligibility decision with a complete analysis of borrower’s loan and credit information against multiple standard or custom programs.

****Dennis Boggs, EVP of Business Development for Calyx Software says,”We are proud to announce LoanScoreCard, which provides universal access to FHA TOTAL Scorecard, for everyone in the mortgage industry. The beauty of LoanScoreCard is that it offers improved, user-friendly findings, and saves money on underwriting at the same time. Everyone can access to LoanScoreCard no matter what loan origination system they’re using. And if they are Calyx users they can access LoanScoreCard from inside Point.”

****LoanScoreCard is a HUD-approved automated underwriting system (AUS) that determines a loan’s eligibility for FHA insurance. The tool provides a detailed FHA Findings Report with decision from TOTAL and LoanScoreCard underwriting, along with set of HUD-approved messaging. LoanScoreCard is available via Calyx Point, standalone web access, or web services.

****LoanScoreCard is one of few programs approved by HUD for TOTAL Scorecard and it offers the same user-friendliness with which Calyx products have always been credited. Calyx users can order their low-cost findings directly through Calyx Point and store them in the electronic document management system for transparent access at any time. LoanScoreCard is also easily accessible at www.loanscorecard.com and can be exported to any LOS.

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.