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Company spotlight: WALZ and LenderLive

Now together, the companies offer end-to-end solutions


On June 1, mortgage services provider LenderLive announced the acquisition of Walz Group LLC (WALZ), which provides regulatory compliance solutions, full-cycle critical document fulfillment and Certified Mail automation.

The acquisition brings together two companies that have extensive experience mortgage and banking experience.

”Together, we provide enhanced mortgage technology, compliance capabilities, critical borrower communication and fulfillment solutions and data-enriched analytics that greatly reduce companies’ compliance and operational burdens. It is exceptional how well the companies complement each other,” said Jonathan Kunkle, president of LenderLive’s GuardianDocs division.

“First and foremost, we saw in WALZ a company that had a unique service offering supporting the most challenging regulatory requirements in the industry,” Kunkle said of WALZ.

 “Where they’ve been successful operationalizing compliance in the default space, we’ve had similar success in origination and loss mitigation. Now that the regulatory pendulum has swung across the entire mortgage cycle with stiffer compliance requirements — we see a great opportunity with WALZ to provide operational support for the entire life of the loan.”

Brad Knapp, executive vice president at WALZ, saw the same kind of strength in LenderLive.

“As we continue to grow, we saw the need to be further up the food chain in mortgage servicing and origination channels,” Knapp said. “The more we learned about LenderLive, the more we saw a tremendous opportunity to provide an end-to-end solution — from origination all the way through to liquidation, loss mitigation and  foreclosure .”

That ability to provide compliance throughout the entire loan process was a main driver for both companies to pursue the acquisition.

“LenderLive has amazing loan modification products, and when we combine our experience in notices with their expertise in the loan modifications, our collective client base is going to be ecstatic with the new offerings,” Knapp said.

F4 picWALZ, which was founded in 1983, serves six of the top 10 mortgage servicers, four of the top 10 vehicle finance companies and more than a quarter of the Fortune 100 corporations. LenderLive, founded in 1999, serves more than 300 financial institutions, including three of the world’s largest commercial/investment banks and several top-tier mortgage lenders.

With the merger, WALZ will operate as a division of LenderLive under its brand and with its current management team, including founder and President Rod Walz.

“One of the reasons for WALZ’s success is their great team,” Kunkle said. “They have a strong group of bright, shining stars, led by Rod.”

The timing for this move couldn’t be better, as the need for companies to have a detailed compliance component has become acute under current regulation, most notably the TILA-RESPA Integrated Disclosure (TRID) rule. With the OCt. 3 TRID deadline coming, they acknowledged the challenge faced by their clients in trying to adapt.

“It is critical we support all levels of tech adoption for TRID,” Kunkle said. “There are a number of loan origination systems that aren’t capable of implementing MISMO 3.3. We have to be prepared to modify our old means of communicating with an LOS to meet the new disclosures.”

To meet the new disclosure timelines, LenderLive is advising clients to look at expanding their use of e-delivery.

“The TRID disclosures’ timing will definitely impact a lender’s ability to close the loan on time. Because of that, the adoption and usage of e-delivery will grow exponentially from what we’ve seen over the last few years,” Kunkle said. “TRID will be a pivotal accelerator for e-delivery.”

“Similar to the TRID impacts, federal, state, and local governments are continually adding regulations that impact both large and small lenders’ servicing and default compliance. This creates a costly and nearly impossible challenge for compliance resource and operational execution management. As a combined company, we offer appealing solutions that help organizations stay operationally, cost-effectively compliant,” said Maria Moskver, chief compliance officer and general counsel at WALZ.

Knapp agreed. “We’ve worked with many large servicers, and now LenderLive can help share our services with community banks and credit unions. Our ability to give them compliant notices and the actual fulfillment of those notices can be a tremendous cost savings for smaller lenders,” he said.

The regulatory burden on small lenders is disproportionate, Kunkle said.

“The cost of compliance is greater than the cost of operations in the mortgage space. For a lender to be profitable, they have to have scale, and many credit unions and community banks may not have the scale to be able to afford the level of compliance we can support,” Kunkle said.

To meet the rising tidal wave of regulation, the companies deploy a dedicated, systematic  approach to compliance. They have a staff of in-house attorneys and outside counsel monitoring federal, state and local regulations and legislation. These legal teams research proposed and final legislation, allowing them to alert their clients ahead of any changes and implement those changes in a timely manner.

“We work closely with industry regulators to gain unique insights, and our attorneys do a tremendous amount of research each and every day,” Knapp said.

F4 quoteMoskver outlined the company’s strategy of being very engaged  with industry associations and monitoring legislative activity daily.

“If there’s a particular issue that’s going to be problematic operationally, we discuss how it will affect the industry with our clients and regulators. Sometimes we can even affect legislative changes,” she said.

WALZ delivers bimonthly legislative updates of all the bills it is tracking, and hosts monthly webinars and weekly calls where clients can ask questions on specific ways the legislation will affect them.

“If you don’t have a legal or compliance team that can cover it all, it’s very difficult to keep up with the amount of regulatory activity, especially at the local and state levels,” Moskver said. “Those can be trickier, with lots of nuances.”

WALZ offers a full library of state-specific notices and monitors state contact information for notices. The company’s compliance support is not limited just to updates on what legislation will be enacted, but also how the client should approach operational compliance, including forms’ content and timing requirements.

“Our regulatory compliance approach is what sets us apart,” Moskver said.

“We are not just interpreting the regulation, but determining how clients can operationalize those changes. We discover what the next step is that they need to take and then actually help them take it. This applies to our support of the largest lenders and servicers in the industry down through the smallest. Each requires a unique approach to operational compliance.”

Kunkle predicts that helping clients achieve compliance will be even more critical as the number of new regulation-related suits and inquiries begin filtering down to companies.

“In servicing we already see a mountain of requests relating to whether all possible loss mitigation avenues were taken prior to the foreclosure process. Marrying operational compliance to the proof of the process will be mission critical going forward,” he said.

“WALZ and LenderLive together complete the client solutions we’ve been after — to give the client not only support for the compliance process but to give them tools to provide a forensic, evidentiary review when required as proof down the road of actions taken.”

Luckily for their clients, WALZ and LenderLive stand ready to provide support.

“We have developed an end-to-end business acumen of what an originator and servicer needs to have and be prepared for, combined with a unique, comprehensive product set to support all facets of the lending organization,” Kunkle added.

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