News & Insights

Data-Technology Simplified: Mortgage Solutions

mortgage solutions

Scenario #1: Automate Your GNMA Purchase Advice Process

Work Details:
In loan purchases, mortgage firms sell loans to GNMA in bundles called pools. After the sales process, GNMA sends two individual PDF files to the mortgage firm, the 11705 and 11706. The 11705 contains the pool data, and the 11706 has summarized and detailed loan-level data from the settlement. From these two PDFs, approximately a dozen GNMA-generated details are hand-typed onto a spreadsheet for batch upload or typed directly into the servicing system. This process is entirely manual, sitting on desks throughout the industry. While it may take less than four minutes to type up the data on a pool, it can take up to fifteen minutes.  Medium-sized firms have an average of four hundred pools to create each month. This translates to nearly a quarter of an FTE. If you want to scale, this would require stacking additional hours against performing this function. On top of the amount of work, this doesn’t consider the errors inherent with any manual data transference. The data entered into the servicing system often contains errors or does not match the original data from the GNMA PDFs. Corrections add complexity in both time and bearing due to the impact of incorrect reporting and the direct time required to open each document to compare a dozen fields and retype them into the system of record. Once you add in the correctional time, this translates to well over half an FTE for a firm with a moderate number of pools. 

BaseCap Solution:
With BaseCap Analytics’ Mortgage Quality Manager, you can automate this manual process using its Doc2Data feature. This feature will allow you to automate the reading of the GNMA 11705 and 11706 and create the Purchase Advice (PA) output. Whether you have twenty pools a month or thousands, Doc2Data removes all the manual work by generating the details in less than one minute with one hundred percent accuracy. 



Scenario #2: Identify FHA Over-Allowables Instantly With Non-Performing Loan Review

Work Details:
Many firms throughout the mortgage industry are required to onboard seasoned loans. These loans often come with a rich and complicated history, including challenges the borrower had with remaining current and the prior servicer(s) actions taken on behalf of the borrower – which may or may not have been accurate. In order to bring these loans in-house requires the new shop to evaluate each loan. To evaluate each loan, a firm is required to determine if aspects of the loan or the servicing of the loan conflicted with any guidelines. These guidelines include federal, state, regulatory, or from an entity such as FHA. The guidelines have stringent lines determining whether actions were correct and whether the new firm can collect old fees from the prior servicer. This review of the portfolio helps determine which loans are currently delinquent  and which actions were taken for each of those loans must be undertaken. A non-performing loan review is used to evaluate timelines and advances.  This review allows a new servicer to identify areas of risk and request reimbursement from the prior servicer. However, seasoned loans come with a level of risk as the new servicer needs to properly identify outages within a limited window, or they lose the ability to request reimbursement for over-allowables. This process necessitates an expense-by-expense and transaction-by-transaction review for hundreds and even thousands of loans. The time required is staggering and often exceeds the window for pursuing reimbursement. Ultimately, this leads to companies writing off millions of dollars yearly simply because they cannot review the loans quickly enough. 

BaseCap Solution:
With BaseCap Analytics’ Mortgage Quality Manager, the data sources can be run through a Non-Performing/FHA Over-Allowable policy pack to identify exceptions or risks. It leverages the prior servicer’s data to reduce unnecessary financial losses from unidentified over-allowables. After the data check, the Mortgage Quality Manager will provide your teams with exceptions to be reviewed to determine if a reimbursement request is required, all on the same day as the data becomes available. By providing this information, BaseCap Analytics maximizes your transparency on the acquired loan portfolio to allow proactive risk management within the 90-day timeframe. The Mortgage Quality Manager reduces losses and supports scalability, supporting your business in stride with market shifts and investment opportunities.



Scenario #3: Servicing Transfers Made Easy

Work Details:
Transferring loans is painful for everyone involved. The borrower has no say in the process and yet is the most significantly impacted. Each servicer has to engage in significant mapping exercises and crosses their fingers that the underlying data is correct enough to make the result functional. At its core, a servicer transfer is a data transfer from one servicer’s platform to another and moving this information is incredibly manual and complex. Issues commonly arise from the fact that the data has not been fully validated before moving systems, which causes it to have inaccuracies before, during, and after the transfer. Customers, in particular, bear the weight of these issues as payments get lost or duplicated, escrow gets incorrectly calculated, and customer service loses the ability to help. These data inaccuracies can cause significant regulatory, customer, and business impacts.

BaseCap Solution:
With BaseCap Analytics’ Mortgage Quality Manager & Automated Servicing Transfer feature, firms ensure data will be accurate before moving onto the receiving servicer’s system. The servicing transfer feature automatically evaluates each field to identify exceptions and risks by leveraging hundreds of policies supporting FNMA guidelines and industry standards. Additional functionalities, such as Smart Mapping, accelerate new servicing transfer mapping and allow you to reuse existing mappings, compare previous ones, and apply them against new servicing transfer files. By eliminating manual and complex data transformation processes, BaseCap has introduced a streamlined and automatic tool that cuts down the timeline from months to days/weeks to complete.