Serving The Small And Mid-Sized Lender


Small to mid-sized mortgage bankers fund 50 to 1,000 loans per month. These lenders have the same technology needs as larger lenders, yet typically struggle with fewer resources to streamline operations and ensure compliance. In the past, this was a significant competitive disadvantage, but some technology companies have more than leveled the playing field for this important market segment by delivering powerful solutions that rival the largest lenders’ capabilities.

It is important that the vendor has mortgage bankers on staff that clearly understands the impact of not meeting a sales contract deadline, missing a lock delivery or working through a repurchase request.

Why is this deep industry working knowledge from the LOS provider so important to a lender’s management team? It’s simple- if you are dealing with these types of business issues, then you are not focused on growing your business. In addition, the cost to cure these issues is taken straight from profits. Lenders are often hobbled by work-arounds, manual processes and low expectations from their systems. With today’s technology there is a better solution for mortgage lenders.

Small to mid-sized lenders need an integrated solution from their LOS that is affordable and easily maintained with minimal staff. These attributes can only be designed by close collaboration with lenders by technologists who have experience in the small to mid-sized environment. The best providers understand the features necessary for both the lender’s users and the system’s administrators, enabling both ease of use and efficient operations.

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Tools, Customization and Sharing the Load

Users need tools to streamline their everyday activities. Administrators need to be able to implement and maintain the tools with far smaller staffs than large lenders. Loan origination system providers that truly understand the middle market appreciate the value of sharing the administration responsibilities. Additionally, modifications to customize the application should be provided via table configurations rather than software development. Systems for the middle tier are architected to have the vendor manage the version, compliance and table configuration best practices. At the same time, they allow the lender’s administrator to turn on various features by role, or establish unique customized workflow to ensure the application meets their specific needs. Simply put, the best LOS designs present the right information to the right user at the right time.

The right origination technology dramatically reduces the problems caused by process issues distracting lenders from focusing on growing their business and the bottom line. Here are five points that a small to mid-sized lender should require from their technology partner when their operations struggle with daily challenges:

>> Broad scope of tools with table based configuration

>> Tightly integrated third-party vendors

>> Rules based workflow

>> Robust data access

>> A collaborative and transparent relationship

Each of these requirements should be considered just as important as cost to ensure your operations run smoothly and maximize your return on investment. Lenders should also remember that these items need to be implemented in a timely manner to successfully contribute to the bottom line. The following is a breakdown of each requirement in more detail.

First, the scope of tools should include everything from initial inquiry to selling the loan. If a lender is required to integrate various tools they will need more time to implement and maintain them. Additionally, it’s likely that a lender will not have an accurate single database of record to ensure that data entry from initial origination and throughout processing matches the information used for closing or investor delivery. This can result in pricing issues and delivering files to investors that are not purchased – or post-closing liability from an end investor when a defect is found years later after a payment default. These are common issues for lenders who do not have an effective system of record.

Lenders also must assess the types of tools each role needs. Borrower-facing tools such as online portals allow an originator and the lender’s staff to efficiently collaborate and document communication with borrowers throughout the loan process. Built-in imaging will ensure the data and file documentation are simultaneously managed and match file requirements. Integrations must be incorporated in a manner that allows each role to easily complete the steps that are dependent on third parties.

The Industry Relies on Third Parties

This leads us to the second requirement – tightly integrated third party vendors. As part of the loan manufacturing process, lenders have been exchanging data with credit agencies, underwriting systems and flood for about 20 years. Pricing, compliance, fraud and tax verifications vendors are commonly used, and the latest wave of integrations now supports asset, income, employment and property information. Successful lenders will have an effective plan for all of these services.

High functioning integrations will, at a minimum, support two-way “lights-out” data exchanges. Lights-out is a method that ensures the data needed to request services has been completed before the order request is made. The user’s login credentials are stored in the LOS and the LOS has a method for sending the request and retrieving the results (data or forms) automatically. The user will never have to leave the LOS platform to complete their work, a major time and cost saver.

More advanced vendor integrations run based on rules established in the LOS and allow the lender’s employees to focus on managing the exceptions rather than the tasks. This is critical: it means the staff will focus on resolving an issue such as a compliance alert or a flood zone determination requirement rather than the task of running an interface. High functioning LOS’s should offer and support work queues that leverage the results of automated vendor integrations.

Rules and Roles

The third requirement of small to mid-sized lenders is that the systems be based on business rules or logic to ensure the right information is presented to the right user at the right time. Making a loan is very similar to an assembly line and each employee in the organization contributes to the final product. For each person to do their job correctly other roles need to have completed their responsibilities predictability and accurately – sometimes sequentially (completed before them) and sometimes in parallel (completed simultaneously).

A rules-based system incorporates logic to ensure workflow is predictably completed and accommodates all roles within the organization. Rules-based engines should be used to identify what data is needed, what documentation is needed and when they are needed. Logic can also be used to determine if data is within a valid range or if it meets specific loan program guidelines.

The fourth requirement that lenders should consider is what tools and/or methods are available to access their data. This means simple and effective data exports, as well as the ability to establish customized data exchanges with proprietary tools. At a basic level, a lender should have the ability to export their data in Ascii, comma delimited or XLS formats. Additionally, standardized industry formatted exports such as MISMO and FNMA 3.2 should be supported for a single loan or for a list of loans in a batch process.

Lenders need advanced support

Today’s lenders are now looking for more advanced data integration support. These options include ADO (ActiveX Data Objects), Web services and database replication – all of which are available with the industry’s best LOS providers. Advanced data integrations allow lenders to read data, write and perform functions such as creating a loan or moving images in real time. These tools are the foundation for real time reporting and to transport data from customized CRMs or out to hedging, servicing or data warehouses. As such, a single database of record is necessary to ensure lenders are efficient and accurate in all data reporting and collaboration activities.

The fifth requirement a lender should seek is a collaborative relationship. Lenders know their business much better than any software executive or business analyst, and they need the ability to discuss, strategize and prioritize on the issues that impact their everyday objectives. Focus groups have a role, as the ability to ensure your needs are addressed and understanding your vendor’s strategy to get there is valuable. The most productive relationship with a vendor will be a transparent relationship. Know what your LOS provider knows, where they come from and where they are going. And importantly, assess whether you’ll have a say in their future plans to support your operations.

Are You Missing Out?

Without these tools, how much business are you missing out on? Perhaps more than you think. The modern LOS technology is the single most important decision a mortgage origination company can make, and the tools it provides can directly impact efficiency, profitability and marketing reach. Understanding the business realities and the needs of its users are, in the final analysis, more important than the bits and bytes that go into a system’s makeup. The most sophisticated code ever written is of no value if it is not relevant. A vendor that is true, knowledgeable, and listens to your specific needs to help you achieve and exceed your company’s goals delivers the best loan origination solutions.

Just as preferred lenders of any size earn that status by listening to their customers, premiere technology providers become the first choice by understanding the needs of their lenders. As in life, learning never stops – and we have found there is much to learn from the small and mid-tier professionals of the mortgage business.

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Online Borrower Collaboration Best Practices

Borrowers are frequently turning to the Internet to research, shop and apply for their home loan.  As customers become more sophisticated, their expectations are rising on what tools should be available to streamline status updates or communicate with their Lender.  Simultaneously, Lenders need to reduce costs and streamline operations with their workflow. The answer is offering a Borrower Portal.

Online collaboration should be viewed as a “Required alternative” and not necessarily a designated process. There are and will continue to be those applicants who want to meet face to face; however, “the times they are a-changin”. When implemented properly, the right process makes a lender’s job easier and improves your service levels.

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So what is important and how do you get there? The following is a list of seven objectives lenders should consider as they develop or refine their online borrower portal initiatives:

Messaging / Status updates – The first requirement of an effective portal is to ensure the lender’s staff is not required to do more work to support loan updates. For a gain in productivity the portal should automatically identify and alert applicants based on LOS updates when key milestones have been met such as loan approval, appraisal received or time to schedule closing.

Staying compliant with the consent process – Lenders need to track when applicants opt in, opt out and consent for each individual applicant. To remain compliant, applicants should not see other applicants’ sensitive date and be provided with individual disclosure delivery for loans with a rescission.

Applicant authentication – Lender’s need to validate that logged in applicants are in fact, who they say they are. To accomplish this your solution should complete “out of wallet” identity verification to provide “challenge” questions from public records and or credit reporting that ensure compliance.

Disclosure delivery / e-Signing – The timing and cost of managing upfront disclosures, redisclosure of Loan Estimate’s, locks, appraisal, MI changes, flood and closing disclosures is crucial. An effective online portal will ensure each applicant gets a timely delivery of disclosures and provides an integrated log within the LOS system.

Pricing / Locking – Giving an applicant the opportunity to check pricing and lock when authorized requires integrated rate sheets and or pricing engine functionality. Your portal strategy needs to be configurable to ensure loan status, specific conditions and or time of day are properly managed.

Loan Conditions – Real time loan conditions can start with the application and be managed through to loan approval. Borrowers should be able to easily understand what is needed and have a simple solution to upload conditions directly to the lenders paperless work queue.

Mobile Friendly and Real Time Alerts – The Lender’s staff should be aware of incoming messages and loan documents with proactive alerts. The LOS needs to be configured to manage a queue for each user that identifies incoming alerts, when conditions are uploaded and need review, and the status of disclosures delivered online. This process should be available on smart phones, tablets and various web browser tools.

How can you get there? While there is no shortcut in implementing, Lenders with an interest in streamlining processes online should consider the efforts of developing a solution internally or working with a vendor who specializes in the tools they need. Consider what is necessary for a long-term fully integrated solution. How will your vendors such as disclosure/closing documents or pricing engine be supported? Does their road map ensure you have a long-term partner? The right strategy allows a lender to grow into a solution as the consumer direct channel evolves.

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Out Of The Frying Pan And Into The Fire

The complexity of the ever-changing regulatory environment is posing an overwhelming burden on lenders of all size, especially small to mid-size lenders. Significant factors are forcing lenders to rethink their lending operations such as the flood of new rules and regulations, heightened pressure to reduce loan production costs, lack of effective controls, Interest rate risk, implementation failures, and intense urgency to increase profitability while mitigating risk. Lenders without confidence that their operations are properly supported must find a solution that lets them focus on doing what they do best-closing loans.

Loan Origination System technology plays a key role in helping lenders manage their challenges. It’s not uncommon for lenders to be presented with demonstrations showing systems that appear to be everything they need; however, during implementation, reality sets in with different results. Some LOS vendors have the ability to do everything they want, but many vendors are not transparent about the cost and effort required to implement or support new systems.

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All is seemingly wonderful while the lender is being courted. Vendors will show all their sexy features and functionality, the extensive amount of bells and whistles they have to offer – but lenders often forget to ask the right questions. How much administration will the system require? Will the vendor agree upon contractual obligations for all of the lender’s go live requirements? Do they offer a pilot program in which one branch can test the system before transitioning the entire organization? Do they offer a lender lab in which users can go through the entire process of entering a loan?

Additionally, today’s borrower demands lenders to have tools in place to support their consumer direct strategy such as an online applications that can be branded by the institution, individual branch or loan officer, automated decisioning and loan product eligibility and pricing, document and disclosure deliver and condition management to improve the lending experience.

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It’s crucial for an LOS to know that their business is about helping lenders successfully navigate today’s complex mortgage environment and take the time to fully understanding the lending operation, listen to concerns of the lender, and provide solutions integrated with industry leading best practices.

On top of having all the right tools, programs and support, lenders should not have to be burdened with managing heavy IT infrastructures and costly operational demands. The right solution will consistently delivers superior service that eases your burden by simplifying mortgage banking’s ever increasing complexities. It’s about driving productivity through a partnership that maximizes your resources and their mortgage banking experience.

Customers often select a vendor because it can ultimately meet their needs, but then the lender is let down because it takes too much time, money and work to actually do everything they need. How do you hold vendors accountable to make sure their solution does what you need, even after the honeymoon is over? The answer is in the due diligence-due diligence and then more due diligence. Six questions that every lender should pose during the due diligence process should include:

  • Can I test drive the system in a Lender Lab?
  • What does the implementation, pilot and training program consist of? Does it include setting up required work flow and vendor integrations?
  • What customer, training and ongoing configuration support is included and what are the costs?
  • What responsibility does the vendor have to reduce operating and maintenance costs?
  • Are the above clearly identified in the licensing agreement?
  • Does the vendor have a road map and do they collaborate with you to ensure it will meet your needs?

Lenders have to know exactly what they need and assure that those needs are addressed in their contracts. Don’t rush the process. Take the time to do multiple test drives and trial runs, ask the tough questions and check the references. Bottom line – Don’t jump out of the frying pan and into the fire when selecting your new LOS partner.

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Avoiding Death By 1,000 Paper Cuts


lionel-urbanFor years the mortgage industry has been inundated with paper processes and the shuffling or paper files back and forth to complete a loan file. This has definitely been the case with disclosures causing numerous inefficiencies and not to mention 1,000’s of paper cuts throughout the process.

Historically, mortgage lenders have loosely managed the paper intensive disclosure process without much attention to detail in two steps. For the first step most lenders issued initial disclosures when they had a file ready for processing. Then a second step would be to correct disclosures that were missing, had non-compliant dates, or were incorrectly prepared at closing. Although many regulatory requirements were in place back then, regulators often assumed that the lenders were properly handling these regulations. Today it’s a whole new game and lenders need to implement effective electronic disclosure solutions to stay in business.

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The Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA) has required lenders to provide two different disclosure documents to consumers applying for a residential mortgage loan. The goal of these two documents was to present a complete picture of the loan transaction for borrowers in a timely manner to simplify the process of understanding fees, payment terms, and loan program features.

Additionally, there are numerous Federal and State disclosure requirements for locking rates, loan programs, mortgage insurance, appraisal, flood, Change of Circumstance, and of course the new TILA-RESPA Integrated Disclosure (TRID) process. The disclosure process now takes place at application and at multiple times along the way, prior to a loan closing. And, to add stress to a lender’s operation, regulators are stepping-up enforcement to ensure and document how disclosures were completed, delivered, and received by applicants.

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The CFPB has acknowledged that the disclosure process has been a huge pain-point for all parties involved. There are multiple disclosure types and numerous paper documents that are shuffled back and forth, and it is easy to see how those involved in the current disclosure process are experiencing “death by a 1,000 paper cuts”.

To “simplify” the lending process for applicants the CFPB set out to address this issue by integrating the mortgage loan disclosures required under TILA and RESPA to create the TILA-RESPA Integrated Disclosure (TRID). The mortgage industry is now only months away from the CFPB’s August 1, 2015 deadline for the new requirements under TILA-RESPA and the new Integrated Mortgage disclosures. The requirements of TILA-RESPA reform (TRID) as well as other ongoing regulatory updates create a host of challenges for mortgage lenders and their technology providers.

Let’s face it – the disclosure process is extremely complex. While TRID is getting all of the headlines, there have been and continue to be an onslaught of changes, updates, and new requirements for all types of disclosures. These include: Application disclosures, 3-Day Disclosures, Program Disclosures, MI Disclosures, Change of Circumstance Disclosures, Lock Disclosures, Appraisal Disclosures, Closing Disclosures, and even Flood Disclosures when required.

In addition, regulators are much more assertive with monitoring and supervising regulatory practices, putting a heavy burden on lenders trying to comply with the latest rule or regulation. It is not enough to just address the new TILA-RESPA Integrated disclosures. The regulators continue to change, modify, and revise requirements for all of the disclosure types.

TRID requires significant changes to the loan origination process, specifically in how lenders handle closings. The new requirements state that the closing disclosure needs to be at least three days ahead of closing to meet the Closing Disclosure timing requirement. Lenders are now on the hook and liable for closing, and any error could have a significant impact on all parties of the loan transaction. Last minute changes will impact not only the borrower, but also the seller and other related parties involved in the real estate transaction.

This now presents a number of challenges that the lender must be able to address, properly disclose, and track to avoid potential penalties and fines. What is the actual disclosure process for this specific disclosure? Is there just a borrower or is there a co-signor? What is the delivery channel? Internet? Email? SMS address? Has the borrower e-consented or opted out? If opt out, has the printed disclosure met the timing requirements? Who is responsible for re-disclosing? How is all of this being communicated and tracked?

The new regulatory requirements and implementation of TRID creates an environment of elevated risk for lenders. Accountability, liability for timing, accuracy, and completeness of disclosures with the ability to track and provide a detailed audit history is putting intense pressure on lenders to comply. This is especially true for small and mid-sized lenders who don’t have endless resources to throw at this issue, but can’t afford to not properly address these changes.

To manage the process lenders should:

  1. Have a system in place that identifies loan applications, For example, do my policies & procedures clearly spell-out when does a “pending application” become a “loan” (recalling that a loan is what triggers disclosure rules)
  2. Have a system in place that uses data from the LOS to identify when disclosures are required and establish workflow to automate the process when possible
  3. Have an operations process that ensure disclosures are accurately prepared and delivered to applicants in a timely manner
  4. Have a system in place that automatically logs and tracks information that identifies what information triggers a disclosure event, how disclosures were delivered and, when possible, an acknowledgement of applicant receipt of the disclosures
  5. Have a system that stores copies of the disclosures that were issued
  6. Have reporting in place to identify disclosure requirements, successful delivery, and disclosure exceptions.

Are you confident your vendor is able to comply with these complex changes while maintaining service levels and operational efficiency? The time to enhance your outdated disclosure process and technology is now. It’s not just about avoiding paper cuts anymore but being able to proactively address the new and mandatory regulations.

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Reducing Costs And Improving Compliance


2014 was another extremely challenging year for the mortgage industry. Lenders found themselves in an environment that required them to be competitive and compliant, as well as efficient and profitable. In consequence, while the pressure to produce remains constant, the cost to originate continues to skyrocket, requiring lenders to maintain compliance while trying to contain costs.

The mortgage industry has been overwhelmed with a flood of new rules and regulations while dealing with unpredictable origination volumes. This combination has put intense pressure on mortgage lenders to update compliance processes while producing new business volume. Violations can carry severe financial penalties or possible civil actions. Responsibility now falls squarely on the lenders’ shoulders. With the scope of regulation now reaching into all aspects of mortgage operations the days are long gone when a small to mid-sized mortgage lender can go it alone or with outdated technology. In this lending environment, this is simply too risky.

Increased compliance scrutiny and pain of non-compliance has been a multi-year trend that has continued to a point of exhausting lenders and the trend will likely continue. Lenders have made the easy corrections to their environment and now need to assess more thoughtful ways to meet the increased demands.

At the same time, as lenders are feeling greater scrutiny from CFPB and other agencies – at both the federal and state level, they are also experiencing increased demands on their IT infrastructure (security, cyber threats, hardware requirements etc.) and heightened competition with the need to produce sustainable results. So, not only must they ensure compliance throughout the origination process, they must also ensure their IT demands are met without an increase to their budgets.

These trends are getting worse and while many lenders may have made the simple process changes they must now take a more proactive approach to finding better resolutions if they plan to survive in the future.

Higher Costs Originating Loans

To meet these ever growing challenges, lenders’ overhead has increased significantly to support back-office compliance, which is driving up origination expenses to the point that lenders current practices are too expensive.

That’s on top of the record low production profit of $150 per loan the industry has experienced in 2014 according to Mortgage Bankers Association (MBA) data.

MBA chief economist Michael Fratantoni stated that “The losses are not a result of lenders aggressively pricing mortgages in order to make up for lower volume. Rather, it is due to higher expenses, especially because lenders have had to add back office staff to deal with new compliance requirements put in place after the mortgage crisis.”

These market conditions are putting intense pressure on all lenders, but especially small to mid-sized lenders trying to keep pace with their larger counterparts. With back office costs sky rocketing small and mid-sized lenders must find a way to contain these costs if they want to remain competitive and survive.

So what is the answer?

Can small and mid-sized lenders continue to compete, or are the larger lenders going to continue to throw resources and bodies at the challenges to gain more and more market share? The answer is clear, if small and mid-sized lenders continue to do business as usual and are constantly reacting to changing market conditions with outdated technology, they will not survive.

The good news is there is a way for these lenders to compliantly compete and be able to contain the rising costs to originate.

Automation the Great Equalizer for Small to Mid-sized Lenders

Small and mid-sized lenders need to realize that the right technology and automation can be the great equalizer. That sounds great but how can lenders benefit from automation while also containing their IT costs and infrastructure?

Advanced fully hosted mortgage Software as a Service (SaaS) allows lenders to reduce ownership and costly upgrades, simplify and accelerate system implementation, enjoy worry-free security, and benefit from a centralized data repository. For most lenders, technology ownership is a fixed cost for a resource that rarely reaches its expected return on investment. Further, loan origination systems are notorious for slow implementation and are subject to numerous annual upgrades that can be either expensive, time consuming, or both, to deploy. As a result, the right SaaS solution has become a prime candidate for outsourcing, especially for growing lenders.

Mortgage lenders should consider the following when assessing a SaaS LOS provider:

Does the vendor provide a “test drive” environment that allows access to the platform to validate that it will work for those lenders’ specific needs?

The key, especially for small to mid-sized lenders, is in an out-of-the-box solution with lending best practices already built into the solution versus a system that requires significant configuration and support by the lender just to originate a loan. The out-of-the-box solution minimizes the time needed for implementation and eases the burden for the lender to proactively address today’s most challenging market conditions.

Does the vendor have a transparent and collaborative culture that performs as the lenders IT partner?

Is the system based on the right technical infrastructure for stability and data access?

What is the vendor’s track record of uptime interruptions? Has the provider had costly outages in the past? Does the database run on MS SQL? Does the vendor’s system run on archaic Flat files vs. a truly Relational Database? Will you have easy Data Access? How robust is the network/data center?

Does the vendor support third party vendors in a best of breed model or promote internal inferior products?

Does the system support the industries best vendors with high levels of feature functionality with seamless integration? Does the LOS provider charge vendors with high “click fees that results in the lender paying for higher charges? How much effort is needed to configure the system for the lenders’ specific requirements?

Is the solution competitively priced?

In addition to meeting the IT infrastructure demands, small and mid-sized lenders must address the ever growing burden of compliance. Lenders of this size simply do not have the resources to constantly monitor, proactively address compliance changes, and interpret how these changes will impact their organization. Remember, it is not just the rising costs to comply, but also the significant ramifications for non compliance that lenders must be able to handle.

Therefore, lenders need to strategically partner with a technology provider that can handle these compliance mandates. The provider must have a compliance focus, one that proactively monitors the changing compliance landscape, follows best practice compliance standards, and streamlines application data security. The solution should provide lenders with the ability to ensure that compliance policies and procedures are adhered to while efficiently completing the lending process.

In today’s highly competitive marketplace just having a SaaS lending solution with compliance is no longer enough. It takes the right provider to be able to deliver a cost effective, highly compliant solution with the right IT footprint for small and mid-sized lenders to succeed.

The right solution needs to be delivered from a vendor that has an extensive mortgage banking background. This background is critical for the success of the small to mid-sized lender. Technology is only a great equalizer when it actually solves and adapts to specific market conditions within the mortgage industry, thus requiring extensive mortgage banking expertise from the provider. Providers who are just delivering SaaS technology and hope that the small and mid-sized lender has the staff, resources and knowledge to constantly customize the technology needed to realize that their product will not contain costs, nor level the playing field. That is why the provider’s extensive mortgage banking experience is so very important.

Another key aspect in leveraging the provider’s mortgage banking expertise is on the compliance front. It is not enough to know the new rules and regulations, new disclosure requirements, or the upcoming change to the TIL, but the provider must be able to interpret the new rules, be able to quickly incorporate changes into lending solution, and work with lender as a partner so that the lender understands the potential impact on their business.

In addition to extensive mortgage banking expertise, the provider needs to be nimble and able to quickly and cost effectively change with today’s constantly changing market conditions. It is not enough to just incorporate the latest regulatory change but your vendor must have the foresight to already be working on what’s next. Large, public vendors that have layers upon layers of management and elaborate chains of command often can’t change and adapt with market conditions as quickly as needed.

If small and mid-sized lenders are going to remain competitive and survive in these market conditions they need a vendor who can change direction on a dime and provide them the insight, IT infrastructure, and strict compliance needed. This all must to be done in the most cost effective manner possible if it is truly going to be the great equalizer for small and mid-sized lenders.

Small and mid-sized lenders can compete and succeed in today’s challenging mortgage environment. It comes down to partnering with the right provider to deliver the most advanced SaaS solutions that easily address compliance and contain IT costs. The time to explore all your lending solution options is now.

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A BIG Confirmed LOS Acquisition

Rumors about technology acquisitions are floating around a lot these days. I hear most of them. My policy has always been not to report on a rumored acquisition until the deal has been closed. Rumors are not news, they are just rumors until something actually happens. Today I can bring you confirmation that a long rumored LOS acquisition has closed. Here’s the scoop:

PCLender, LLC has acquired the PCLender loan origination system (LOS) back from Black Knight Financial Services and formed a new company that will focus on providing turnkey mortgage technology solutions for midsized mortgage bankers. No sale price was disclosed.

PCLender, LLC has been heavily capitalized to expand the system functionality and implement automation solutions for lenders requiring increased compliance and workflow efficiencies. The system currently supports banks and credit unions with consumer point-of-sale, loan processing, automated underwriting, loan closing, integrated imaging, secondary marketing, trade management, warehouse management and interim servicing. PCLender’s retail and wholesale platform will now be expanded to support correspondent lending and include automated loan audit and post-closing review support. Additionally, an emphasis will be made to refine vendor integrations and build out fulfillment services that streamline lender operations.

Lionel Urban, president and CEO of PCLender, LLC said the management team will initially focus on strengthening customer relationships and pursue customer collaboration to speed the pace of design enhancements. “I believe the PCLender customer base has some very valuable feedback and we intend to implement that into our development road map. I think that was a strength of the organization early on and we are excited to reengage with the customer base in a collaborative manner.”

PCLender, LLC will continue to build on the scalable architecture and security that is currently inherent in the system. PCLender, LLC anticipates the development and support resources dedicated to the LOS will increase by over 60 percent in the next 12 months to support the new growth initiatives.

PCLender, LLC will focus on workflow and configuration defaults that will enable lenders to implement the LOS within 30 days using industry best practices. Mr. Urban believes that the small to midsized mortgage lenders are an underserved market and plans to offer a more robust solution that will require less administrative support by the lenders.

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Market Analysis: LPS Acquires Another LOS

*LPS Acquires Another LOS*
**By Tony Garritano**

***I know that you thought we might get a break from big news until at least after the holiday, but you would be wrong. Hugh Harris, President and CEO at LPS notified staff that the industry giant has acquired yet another loan origination system. LPS currently offers its Empower LOS and recently acquired Web-based LOS PCLender. Now LPS is adding to its LOS holdings yet again. Here’s the scoop:

****Harris said:

****“I am pleased to announce that LPS has recently acquired LendingSpace, a technology company that offers an end-to-end mortgage loan origination software system supporting lead generation through secondary marketing for all mortgage markets, including correspondent lending. The addition of LendingSpace enhances LPS’s position as a leading technology and services provider delivering a comprehensive suite of solutions to support the entire lending process.

****“The LendingSpace technology platform will be offered in addition to LPS’ two existing loan origination systems: Empower, which is used by mortgage lenders with complex system configuration and customization needs; and PCLender, which is used by mortgage lenders, credit unions and community banks that leverage more standardized technologies.

****“The LendingSpace platform, as well as LPS’ other origination systems, will also incorporate LPS’ Loan Quality Gateway to assist originators with their loan quality requirements.

****“The addition of LendingSpace’s robust capabilities expands the number of innovative origination solutions we can offer lenders. We evaluated a number of lending platforms and LendingSpace best provided the scalability needed to expand our product suite. More importantly, LPS and LendingSpace share a common commitment to excellence, integrity and customer dedication.”

****I guess you can never have enough LOS offerings these days. No sales price was disclosed as yet. There you have it my friends, another bit of LOS acquisition breaking news for you to chew on as you enjoy your 4th of July.