Market Analysis - Let’s Take On The CFPB by Tony Garritano

The “Know Before You Owe” initiative at the Consumer Finance Protection Bureau began in May of this year when the new watchdog agency asked the public to compare two different draft designs of a new streamlined mortgage disclosure. In the months that followed, the CFPB used that input to help it improve initial draft designs. Altogether, the CFPB received more than 22,000 comments on how to improve mortgage disclosures. When revised disclosures are released it will represent yet one more hurdle for lenders already struggling to keep up with compliance requirements that continue to become more complex. In response to an ever-changing mortgage market, PROGRESS in Lending has learned that document compliance provider MRG has embraced a data-centric approach to document creation that will help lenders comply with this and any other document compliance issue that may arise in the future. Here’s the scoop:

Lending has significantly changed over the past couple of years. The pressure on today’s lenders is enormous. This lending environment creates dramatic loan document challenges and risks for lenders. Changing rules, regulations, and the ramifications of non-compliance, including fees, penalties and the possibility of buy-backs make the origination process an escalating challenge. Traditional “doc prep” is no longer the answer when lenders are trying to handle these complex and ever changing requirements.

Most lenders, quite frankly, don’t have the time or resources to staff a compliance department that can constantly monitor and accurately interpret the vast number of regulatory changes that are being implemented on a federal, state and local level. Unfortunately, the same is true for many traditional “doc prep” providers. Those providers that rely on an antiquated forms library to deliver static documents, with limited legal compliance analysts, are no longer a prudent choice. Relying on outdated, traditional “doc prep” is a risk that lenders simply cannot afford to take in an increasingly “compliance-centric” environment.

To this end, MRG Document Technologies (MRG) delivers complete, real time mortgage compliance directly into the document process – no static document templates for the lender to choose and manage internally. MRG attorneys constantly monitor the ever changing regulatory landscape and provide dynamic document compliance. MRG does not license any third party content or calculations, which allows MRG to fully rep, warrant, guaranty, and defend, its product. The product is backed by an E/O policy from full disclosure through closing packages, including calculations. No more need for an internal compliance staff to manually manage package content or selection, for fear of inaccuracy.

All document and calculation updates are compliantly and automatically delivered in real time. Together with the lender’s chosen LOS for a seamless, “lights out” approach, disclosure packages are drawn within 30 seconds and closing packages in just a couple minutes. Throughout the package request process, loans are checked with industry leading automated loan compliance tests, thus eliminating the need for additional 3^rd party vendor software. In addition, MRG attorneys are available for services regarding general compliance advice, which is built into the overall compliant document solution.

These comprehensive document compliance solutions provide lenders with the ability to enhance their compliance initiatives. It also gives lenders the tools they need to increase loan production, speed up turnaround times, while significantly mitigating risk. By providing a staff of mortgage banking attorneys to lenders, MRG also delivers the support and regulatory monitoring required to ensure loans are meeting the latest regulatory demands.

Lending has changed forever. So too must the lenders document preparation solution. No longer can lenders rely on antiquated form libraries and technology from traditional “doc prep” providers that have limited legal expertise and experience. The risk and exposure is far too great.

In today’s regulatory environment, lenders must demand more from their “doc prep” provider – compliance and dynamic content technology.

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