TheMReport — News and strategies for the evolving mortgage marketplace.
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TH E M R EP O RT | 29 FEATURE • • Manage•vendor•performance.•An effective ap- praisal management system should provide easily accessible data to help manage vendor performance. It should monitor vendor turn times, fees, ratings, revision request cycles, vendor capacity, and assignment acceptance rates. These metrics give lenders an objective view of operations and will help improve efficiency over time. Data Intelligence in Appraisal Operations T o be successful in mortgage lending, organizations must be on top of market trends. There are so many data points avail- able, sometimes it's hard to focus on what really matters in appraisal operations and collateral valuation. The four data perspectives described below are all readily available in the industry and can give companies a sizeable advantage. • • Originations•in•particular•markets. Real estate markets are hyper-local, and watching the origination volume statistics in particular ser- vice areas is critical to long-term success. With local data, lenders can focus and see trends that matter the most to their business—before everyone else does. If watching local origina- tion volumes, lenders can have a plan in place so vendor relationships are at full throttle and operations are at their most efficient. Mortgage lenders who can effectively scale operations faster than their competitors will outperform them and build relationships that give them advantages for years. • • Trends•from•operations•last•year.•Lenders should consider appraisal and valuation product orders from last year, both early in the year and during the summer. They should analyze which areas saw an increase in valuation, turn times, and fees. By know - ing what happened last year and when, lenders can develop a plan to proactively manage those areas before it gets busy again. Do they need to raise fees in certain mar- kets or reach out to a few appraisal manage- ment companies now? Watching recent history in specific areas allows for proac- tive management of borrower expectations and service. Should closing dates be better calculated to align with expected trends? If so, having a plan in place now will make a dramatic difference in overall success rates. • • Vendor•performance•statistics.•Valuation management software will provide insight and analytics into vendor performance. Whether using appraisers, appraisal management companies, or both, lenders should monitor order acceptance rates, average turn times, rework rates, on-time rates, and revision request cycles. Beyond just examining its own vendors, lenders should also make sure to look at out - side data on the overall average appraisal turn times in specific markets. With this information, it's possible to verify that operations and vendor panels are performing competitively in the overall market. Monitoring even the simplest vendor performance statistics will prevent lenders from wasting time placing orders with vendors who aren't likely to accept them or assigning time-sensitive reports to a vendor with a history of late deliveries. Appraisal revision cycles are notoriously time consuming and expensive, but lenders can significantly reduce these hassles by measuring and monitoring the quality of a vendor's previous work. • • Appraisal•fees.•It's crucial to have data for ap- praisal fees nationwide, as well as the specific fees and turn times available in particular areas served. If a lender is paying too little, it will only attract vendors that aren't perform- ing assignments for other lenders. If paying too much, loan estimates can scare borrow- ers off a deal. It's important to keep constant tabs on the ever-changing appraisal fees landscape in order to intelligently manage appraisal operations for the benefit of both borrowers and the institution as a whole. Behind every successful production team is an efficient, fully scaled appraisal operations team. With these tips, lenders can start mak - ing improvements to their vendor management processes immediately and ensure teams are ready to leverage the busy season and growing markets. JENNIFER MILLER is•President•of• Mercury•Network,•the•valuation• technology•company•used•by•more•than• 800•of•the•nation's•lenders•and•appraisal• management•companies.•She•can•be•reached• at•jennifer.miller@mercuryvmp.com.• Our SARA technology platform isn't voice activated—yet. But it does give our clients real-time access to fresh loan-level data and recordings. They're your loans: Visit them whenever you like. E X P E R I E N C E S O L U T I O N S P E R F O R M A N C E www.seleneadvantage.com Selene Ad_4.8333+4.4375_final_final 3/15/17 5:28 PM Page 1