TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/1488302
M R EP O RT | 9 MTECH they are a natural partner in our efforts to bridge communication divides and widen access to home ownership." Guaranteed Rate Inc. has embraced Talk'uments' digital solutions in their ongoing efforts to provide credit and financial education materials to under- served communities. Guaranteed Rate recently an- nounced it launched one of the most extensive Spanish-language mortgage programs in the U.S. housing market. Loan officers, real estate agents and borrowers can now leverage a best-in-class Spanish experience with the company's website, full Digital Mortgage Application, central- ized bilingual processing team, Over-the-Phone Interpretation Services, and critical customer fac- ing communications. A Language Certification process for fluent employees is among many other services and platform enhance- ments. "We are thrilled about the positive impact the Talk'uments partnership will have on our Language Access Program," said Arlyn J. Kalinski, a Language Access Program veteran, acces- sibility advocate, and Compliance VP for Guaranteed Rate. "This technology is a critical piece in our ongoing efforts and commit- ment to provide a transparent, ef- ficient, and inclusive home buying experience for LEP consumers. Our companies will continue to collaborate to expand access to critical homebuying communica- tions in other languages." Measuring Clientele Ability-to-Pay FORMFREE RELEASES NEW AI REPAYMENT OFFERING F ormFree has announced the availability of its Re- sidual Income Knowledge Index, or RIKI, an innovative method for measuring con- sumers' Ability-to-Pay (ATP) for mortgages and other loans based on monthly income and spending. When paired with traditional credit scoring models, RIKI offers lenders a more com- plete understanding of consum- ers' creditworthiness and creates homeownership opportunities for those with little to no credit history. RIKI's knowledge-engineered rules are informed by human financial experts and are designed to help lenders mitigate risk through a more nuanced under- standing of borrowers' spending habits and ability to save. With a borrower's consent, FormFree cal- culates residual income and RIKI by analyzing bank and credit card transaction statements procured directly from the source financial institutions. By giving lenders a better understanding of a bor- rower's discretionary funds after mandatory monthly expenses (e.g., rent, utilities, loan payments), RIKI helps lenders extend credit more inclusively and confidently. In July, San Diego-based Guild Mortgage became the first lender to pilot RIKI with its launch of Complete Rate, a program that provides a more inclusive path to homeownership by allowing consumers with no credit score or credit history to opt in to RIKI's assessment of their financial data for a chance to qualify for a lower interest rate, lower fees or both. "Our Complete Rate program, powered by FormFree's RIKI, helps remove a key obstacle faced by many first-time homebuyers and has allowed Guild to better serve consumers in a challenging interest-rate environment," said David Battany, Guild Mortgage's EVP of Capital Markets. "By supplementing consumers' credit scores with analysis of their real transaction data, our ground- breaking approach democratizes the credit decisioning process for those who need it most—histori- cally underserved racial and eth- nic groups, consumers with thin credit files and people without traditional full-time jobs." RIKI is now available to banks, credit unions, and independent mortgage banks (IMBs) across the United States. The rule-based algorithms driving the now-public feature have been painstakingly engineered without black box machine learning and tested to ensure RIKI cannot develop unintended prejudices. FormFree's cash flow analysis also auto- matically identifies and disregards outliers in a consumer's income and spending history to ensure that occasional windfalls, money transfers or large purchases do not affect ATP estimates. "Traditional credit scoring systems are designed to reward a very specific type of bor- rower: one with a W-2, a strong credit history, and a good debt- to-income ratio. Unfortunately, these risk determination methods bar countless mortgage-ready Americans from affordable home- ownership," said Brent Chandler, Founder and CEO of FormFree. "RIKI rewards something more basic and uncontroversial than credit history: simply making ends meet. When considered with a credit score, insight into consumers' ability to pay and save adds an extra layer of certainty when determining borrower risk." Scrutinizing Loan Quality CANDOR TECHNOLOGY INCREASES EFFICIENCY FOR LENDERS C andor Technology has announced the creation of the first-ever automated underwriting engine for Loan Quality Services (LQS), further helping clients transform their business models for the 21st Century. Candor's LQS addresses many pressing concerns such as QA's impact to fallout, QC impact to loan profitability, leakage of recur- ring defects from QA to QC, and an originator's quality ranking with investors. Candor's LQS gives client members access to automation of numerous capabilities, includ- ing primary source document and data validation; thorough re-underwrite of income and "Traditional credit scoring systems are designed to reward a very specific type of borrower: one with a W-2, a strong credit history, and a good debt-to-income ratio. Unfortunately, these risk determination methods bar countless mortgage- ready Americans from affordable homeownership." —Brent Chandler, Founder and CEO, FormFree