Mortgage Cadence, CoreLogic adding technology to reduce GSE buybacks

Mortgage Cadence, a mortgage software firm, integrated the newly launched Fannie Mae EarlyCheck technology platform directly into its own origination system — the company first to do so, Mortgage Cadence said. Users can now check details on their loan application without leaving Mortgage Cadence’s origination system, Mortgage Cadence Orchestrator. EarlyCheck was developed as part of Fannie’s Loan Quality Initiative, designed to prevent bad loans from being funded. The system allows lenders to validate data on a loan application at any point during the origination process. EarlyCheck was released in late September. In another effort to promote compliance with government-sponsored enterprise rules, CoreLogic Credco released an origination suite Tuesday called FinalCheck. The suite consists of three systems to verify borrower data and help lenders satisfy data requirements set forth the GSEs on loan applications. John Bauer with CoreLogic Credco  said the suite will reduce the number of rejections from the GSEs. “Nearly 6% of applicants will have their debt-to-income increase by more than 3% between pre-qualification and pre-funding, making those loans a candidate for rejection or a buyback. An additional 6.83% of loan applicants will have a debt-to-income that exceeds 45% at pre-funding, putting those loans at risk as well,” Bauer said. “The FinalCheck suite of products plays a critical, proactive role in monitoring debt-to-income ratios and other loan risk factors that could surface just prior to loan submission.” The first piece of the suite, CreditCheck, performs a “gap” analysis on credit information between pre-approval and prefunding. The second system is AppCheck, which searches against proprietary CoreLogic loan application databases and the Mortgage Electronic Registration Systems, or MERS, for undisclosed loans. FraudCheck is the final part of the suite and verifies that neither the borrower or loan participants are on a Department of Housing and Urban Development or other investor exclusionary list. Corelogic Credco is a division of financial analytics firm CoreLogic (CLGX). Write to Christine Ricciardi. Disclosure: The author holds no relevant investments.

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