Mortgage Tech: Black Knight, CoreLogic and Mutual of Omaha

Tech companies target more niche sectors

As more and more mortgage tech companies enter the scene, competition for accessibility and personalization gained speed this week as proptech touched down in more niche submarkets.

Data analytics giant Black Knight unveiled a new self-service style platform aimed at correspondent lending that will allow lenders to manage conditions and validate pricing locks on Best Effort loans.

Coined as Seller Digital, the platform will also allow secondary market lenders to track and validate any Mandatory commitments they are working on in the pipeline.

“To be competitive in today’s correspondent market, lenders must be able to offer their sellers a simple, self-service platform,” said Rich Gagliano, president of Black Knight Origination Technologies. “Seller Digital exceeds these requirements with its unique personalization, automation and integration features, while giving lenders the power to customize configurations based on their own specific business requirements.”

The new mortgage tech is also fully integrated with Black Knight’s Empower platform – a loan origination system (LOS) that will update correspondent lenders as decisions are made on the loans themselves.

Depending on the conditions of the loans, secondary lenders can personalize what information needs to be addressed as a result of Black Knight’s AI program, AIVA. The tech will assess the completeness of the loan package when sellers upload required documents and set conditions when information is missing.

On Friday, Freddie Mac welcomed CoreLogic as a third-party mortgage tech provider for its asset and income modeler (AIM) specifically targeting borrowers who are self-employed.

Though the AIM itself is new technology, CoreLogic’s analytics abilities will automate document submission as self-employed borrowers typically have multiple sources of income. Through the automation, CoreLogic’s tech will then analyze and calculate the income based on the loans guidelines.

“CoreLogic’s digital mortgage tech solution provides us with the appropriate level of information we need to facilitate representation and warranty relief on one of the most challenging calculations in the underwriting workflow, and helps lenders reduce their costs and save time,” said Kevin Kauffman, Freddie Mac’s vice president for business partner integration.

Because self-employed borrowers tend to experience greater income volatility and lack pay stubs or W-2 wage statements, the underwriting process for these borrowers has a greater chance of getting bogged down. A 2018 study from the Urban Institute found during the last recession, self-employed households were much more likely to lose their footing.

“Most strikingly, even when income is held constant, mortgage use and the homeownership rate for self-employed households fell more than they did for salaried households, suggesting that other factors, such as reduced credit availability, are likely at play,” the Urban Scholars said.

According to Jay Kingsley, executive for Credit Solutions at CoreLogic, this is the first of several programs the data giant plans to integrate with the GSE.

The reverse mortgage division of Mutual of Omaha announced the launch of a new app on Tuesday that plans to serve reverse mortgage borrowers seeking either a Home Equity Conversion Mortgage (HECM), or a HECM for Purchase (H4P) transaction.

Featured tools for potential borrowers include initial application access, a mechanism for documents to be captured and uploaded, notifications of “loan milestones” for borrowers and/or real estate agents, and a chat feature allowing communication between the client and loan officer or agent, Reverse Mortgage Daily reported.

“We have seen that seniors have been more able to adopt and use technology over the last few years,” John Metcalf, vice president of sales technology and strategy for Mutual of Omaha Mortgage told RMD. “But I think what’s really come to light in terms of deployment of this app is that you have more people across the country — and across the world — leveraging technology to communicate with their families and friends due to the pandemic.”

While reverse mortgages and HECM programs have received a bad reputation, the reverse mortgage space had a surprising uptick in activity amidst the pandemic as older homeowners tapped into their equity to fill the financial gaps brought on by the coronavirus. HECM originations stood at $13.1 billion as of Sept. 30.

Also, in case you missed it…

Proptech startups Brace and Reggora both snagged Series B funding last week, at $15.7 million and $30 million, respectively.

Months after taking over management of broker LOS platform ARIVE, mortgage software startup LendWize has finalized a deal to take complete ownership of the origination platform.

Real estate services and technology firm SitusAMC has acquired mortgage tech software developer ReadyPrice – bumping the New York-based firm’s acquisition tally to three in just under a year.

Orchard announced Tuesday its immediate availability to consumers in Houston, as well as future expansion into Charlotte, Raleigh-Durham, and the Washington, D.C. suburbs in the upcoming months.

And the Federal Reserve is looking into the rise of artificial intelligence and machine learning, and is considering stepping up its oversight of these technologies used by financial institutions.

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