Four years ago, the housing market crashed, leaving servicers on the line to handle thousands of distressed loans. At the time, most mortgage servicing shops used tech systems with dozens of different applications.
Fast-forward to 2012 and mortgage technology is coming into its own. But, this time, the emphasis is on ensuring servicers, vendors, borrowers and investors have access to the best loan-level data to serve each loan with the utmost care.
Achieving this goal may take servicing and lending shops down various paths, but 2012 certainly was a time when the industry saw tech firms step up their games to provide even higher-quality data delivery and interactive solutions for overly taxed industry professionals facing a slew of regulations.
Here are just a few of the tech developments that firms put in front of mortgage professionals in 2012.
ServiceLink's Fusion moves past static platforms to help servicers
Greg Whitworth, executive vice president of servicing solutions at ServiceLink, a lender platform for Fidelity National Financial, believes 2008 was a technological turning point in mortgage servicing. Post-financial crisis, servicing firms have been on the hunt for strong workflow platforms that consolidate all of the needed 'loan servicing and compliance' functions while simultaneously allowing for the easy addition of new applications that can be built within the workflow platform.
Seeing this type of demand in the market prompted ServiceLink to acquire DRI Management Systems last summer since DRI had developed Fusion--the type of streamlined integrated platform that ServiceLink envisioned for its servicing clients. A tour of the ServiceLink system brings users to a consolidated platform, where users can access everything from legal information, to servicing data and other key functions that are required to effectively manage real estate loans.
Whitworth and ServiceLink highlight how the system makes new single-point-of-contact servicing requirements almost come to life in a technological sense. It's one place where all the key data -- along with all of the key compliance updates -- take place without the need to access 20-plus different applications.
A test drive of the program lets users see how quickly the system can integrate new data such as LTV requirements, debt-to-income ratios and any other compliance or regulatory demands imposed upon the industry.
Laura MacIntyre, Senior Vice President of Servicing Solutions at ServiceLink, believes most of the new servicing rules, including single-point-of-contact, are in "large part because of technological limitations that caused operational issues post-2008."
According to MacIntyre, Fusion is in response to what she sees as static point solutions that dominate the space. For starters, "large mainframe applications are exceedingly hard to adjust and only work well in a static regulatory environment," she noted. Compounding the problem is the fact that other industry solutions are "mostly point solutions that depend on mainframe platforms as the system of record," she explained. These point solutions are also hard-coded to perform narrow functions and cannot easily be adjusted in a hyper-regulatory environment. This environment results in servicers having to deploy and manage hundreds of applications just to remain compliant.
According to Whitworth, "while the benefits of Fusion are best realized with an enterprise installation, the platform does allow users with existing applications to use Fusion for any module within the framework. The design gives users the opportunity to start small and expand the use of Fusion over time--eventually evolving their ecosystem into a single workflow platform."
"I would not be surprised if this application has a relatively sizable market share in three to four years," Whitworth said. "Customers would have a single place to do their work--which is very enticing."
Accounting for Mortgage Bankers by Advantage Systems Inc.
Advantage Systems Inc. is essentially providing the mortgage industry with a full-loan level accounting system known as Accounting for Mortgage Bankers (or AMB).
The company's CEO and founder Brian Lynch said the system is designed to save mortgage bankers from having to publish numerous spreadsheets to see what is going on with individual loans.
AMB lets users track transactions and quickly summon up specific data such as profitability by loan, profitability by loan type, profitability by loan officer and profitability by loan branch. In the past, this type of access required "separate spreadsheets," Lynch pointed out in an interview with HousingWire.
"It allows people to get away from using spreadsheets, and it gives them the ability to do a lot of the reporting that they couldn't do otherwise."
The other value of Advantage Systems is that it allows central banks to have easy access to accounting information from branches.
"It allows you to grow your business without growing your accounting staff," Lynch noted. "In this refi environment, we see a lot of clients (in banking) growing their businesses." Using more traditional accounting methods, that type of growth would have forced them to hire more staff, but today, the accounting technology does not require labor expansion along with growth.
Branch managers can see loan level data in real time in a reporting module that connects the branches to the main bank.
The company's product is focused mostly on the origination side, with 230 active clients.
Global DMS focuses on appraisal
Global Unity, a 2012 tech roll-out from Global DMS, is the company's answer to lenders wanting the option to manage the entire appraisal process from a centralized place within the firm's own LOS system, the company said.
The goal is to connect lenders to valuation products, tools, AMCs and appraisers.
Matt McHale, managing partner and chief revenue officer with Global DMS, told HousingWire, "The whole point of what we are trying to accomplish with Global Unity is to have a system that will have multiple integrations." He added, the system lets users communicate with each other, in addition they will have the ability to send files in real time.
The integration "starts with the lender's LOS system," McHale said. "The information from the LOS is then carried over to our system. It compliantly tracks everything from the initial order to the final appraisal report."