A general lack of investment in mortgage servicing technology is partly to blame for the dramatic rise in at-risk mortgages prior to the financial crisis, mortgage professionals said Monday. Tech investments on the servicing side are needed to restart the secondary mortgage market, said Joe Filoseta, CEO of mortgage services technology firm DepotPoint. Filoseta said a lack of timely mortgage performance evaluation tools left investors in the dark and on the hook leading up to the credit crunch. “This particular episode has truly exposed” weaknesses when it comes to what kind of platforms have been created to detect risk on the servicing side of the industry, Filoseta said during the Mortgage Bankers Association conference in New York. “We need to be able to see day-to-day what is going on in a particular portfolio,” he asserted. Filoseta said technology investments in mortgage finance are rarely made on the servicing side of the business, but the crisis has made it clear that trend should change. His sentiments were echoed by Brendan Keane, senior vice president of the Valuation Group at CoreLogic, who told a panel during the MBA National Secondary Market Conference & Expo that “there is going to be an increase in due diligence on the loan level and the issuer level. These ratings agencies and buyers are going to be interested in who is making these loans,” Keane said. Clifford Rossi, executive-in-residence at the Robert H. Smith School of Business, said there are several key ingredients needed to restore confidence in the market, including prime origination and servicing data, upgraded technology, improved system integration and a renewed focused on data valuation and screening tools that detect risk. “It’s not about how many widgets you push through the system, it’s about the quality of the widgets,” Rossi explained when describing the innovations that are needed to correct flaws in risk assessment and detection. Write to Kerri Panchuk.
Mortgage servicing is too light on technology, MBA panel says
Most Popular Articles
Latest Articles
Real estate farming: Become the go-to agent in your area using these tips, tools & strategies
Learn how to generate a steady pipeline of real estate leads and clients in your area using this proven approach.
-
Zillow believes the evolution of the industry will only help it grow
-
All parties have settled the Sitzer/Burnett suit, so what’s next?
-
Longtime reverse mortgage leader Scott Norman appointed CEO of Texas MBA
-
Rates at 7% attract different types of borrowers, forcing lenders to rethink profit strategies
-
The unchanging