TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/522162
6 | Th e M Rep o RT sponsored story I got a FEVER," shouted Christopher Walken in Saturday Night Live's 'More Cowbell' skit. Ok, maybe the mortgage industry doesn't need "more cowbell," but it is missing something. Want a clue? Think the clink, clink, clink of Will Ferrell's cowbell (that's now echoing in your head as you remember that skit). To me, that sound reminds me of the repetitive noise from a factory, effortlessly creating a product in timed rhythm. And that, SNL fans, brings us to what's missing: automation. The fever of the mortgage indus- try isn't TILA-RESPA Integrated Disclosure (TRID)—or at least it won't be after August 1. Rather, it's automation and efficiency. As you look through your op- erations it's often hard to assign direct costs and risks to indi- vidual tasks performed in loan manufacturing. Orchestrating a seamless, smooth. and efficient process is the key to profitabil- ity, customer satisfaction, and timely product delivery. When GuardianDocs creates innovative products to help lenders achieve this orchestration, we look for duplicative and/or time-consum- ing processes that many have overlooked or other vendors haven't truly solved for yet. One area that's certainly not automated is post-closing. And interestingly, the post-closing pro- cess is replicated. It's performed within your title company and again within your operation staff. Notably, the purpose of each is slightly different, but the process used is the same. More Cowbell? The Missing element the Mortgage Industry Needs is Automation of the post-Closing process By Jonathan Kunkle Following your borrower(s) as they sign the hundreds of pages of closing documents, your title company is responsible for ensuring: • Your closing instructions were followed correctly; • Each and every signature line of each and every borrower, witness and notary are signed and dated correctly; • The Closing Disclosure (as out- lined by the CFPB) has been accurately completed and the loan is disbursed appropriately; • The executed documents are appropriately sorted and stacked; • The note is delivered to the appropriate warehouse line (if used); and • The remaining documents and all trailing title policies are delivered to the lender. Typically during this process the title company is also imaging your loan file (or at least the key documents) for evidentiary purposes. Following delivery of the closed loan back to your shop, your team performs much of the same func- tions. Plus they have to assemble the credit package, which as an aside, if it's not organized originally, can be a significant challenge in your process. After assembling the file into the standard left/right alignment (and creating the case binder if the loan is destined for FHA) it's imaged again and (hope- fully) initially delivered in an elec- tronic fashion to the investor. And, if you're a mortgage banker and not a bank, every day it takes to post-close a file reduces your loan- level profitability due to the nega- tive yield between the note and your warehouse line. Hopefully, if this is the case, your post-closing team is staying on top of this. The post-closing process used to be 100 percent manual with little opportunity to automate. Then came the advent of advanced optical document and character recognition capabilities coupled to improved business process management (BPM) technolo- gies. Augmenting these capabili- ties, GuardianDocs has coupled document preparation data to our document management and BPM application. As an example of some of the advantages of doing so, here are typical post-closing items we can automate: • Are all of the critical docu- ments present? • Are all of the critical docu- ments perfected? • Do the final fees mirror what was dictated to the settlement agent? • If the loan is being delivered to investor A, what are the other critical documents that need to be included? • What is investor A's eDelivery stacking order? • Does the investor require the MISMO 3.3 Uniform Closing Data Set (UCD) or other data file? The underlying questions behind these high-level ones can also be driven through the BPM application in a seamless, lean process. By pushing the document review to the time of ingestion, you can move the cognitive and perceptive review at the knowl- edge level and devote your highly paid resources' time to limited exception processing. Plus, the distributive nature of a Web-based BPM application also extends your post-closing require- ments into your title company, affording them the same automa- tion benefiting your operations. In doing so, you can solve the TRID riddle of ensuring the title company settles with the closing disclosure you already provided the borrower prior to loan closing and validate that your UCD will be 100 percent accurate as well. Clink, clink, clink . . . post- closing automation can exist. It can improve your process, help you be compliant with TRID, and ensure your loans are purchased quickly. Jonathan KunKle is President of GuardianDocs™, the document services division of Denver-based LenderLive Network™ Inc. To learn more, visit GTs.com or email jonathan.kunkle@gts.com.