an nu ale mortgage adoption

8/3/2019 An Nu Ale Mortgage Adoption

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E-Mortgage Adoption

in the Face of Economic Crisis

October 8, 2009


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E-Mortgage Adoption in the Face of Economic Crisis

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Anthony Garritano

Editor, Mortgage Technology

Mortgage technology reporter for SourceMedia

Mortgage Technology Newsletter

MT Video Newscast

Tech Nichesblog

Contact

www.mortgage-technology.com

[email protected]


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Andrew Dubinsky

CEO, Encomia

12 years of mortgage technology experience

Creator, Encomia eLending solution

Founding member of MISMO

eMortgage All Star Mortgage Banking

Contact

www.encomia.com

[email protected]


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Robin Hannah

Vice President, Correspondent eBusiness, Wells Fargo

17 years of mortgage banking experience Focus on strategic initiatives

Formerly with:

Americas Mortgage Group

Prudential Home Mortgage

Norwest Mortgage

MERS eRegistry User Group

Certified Mortgage Technologist

Contact

www.wellsfargo.com

[email protected]


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Dan Jones

Vice President of Technology, Churchill Mortgage

10 years of technology experience7 in mortgage industry

Manages Churchills enterprise technology

Leads eDisclosure, eMortgage initiatives

Contact

www.churchillmortgage.com

[email protected]


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Brian Boike

First Vice President, Lending Support, Flagstar Bank

More than 10 years at Flagstar

MISMO governance committee

Vice Chair, MBA Residential TechnologyCommittee

Mortgage Technologyadvisory board eMortgage All Star Mortgage Banking

Contact

www.flagstar.com

[email protected]


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Reach More Borrowers

In total, 73% of adults are online.

Internet usage has grown 240% overthe last 8 years.

The average credit score of onlineborrowers continues to climb risingfrom an average of 709 in 2006 to 732

in 2008.

In 2008, the household income ofonline borrowers rose to $93,717 an

increase of 10% compared to 2006.

Approximately 40% of lenders takemore than 25% of their applications

online.


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The Borrower Isnt Just Shopping Online

.

Source: Mortgage TechnologyMagazine Data Division.

0

20

40

60

80

100

120

140

1st Qtr 2nd Qtr

Ov erall Originations

Ov erall Online Originati

Online Retail Originatio


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The Government is Forcing Automation

The Home Valuation Code of Conduct

The Safe Act

FACTA Red Flag Rules

The Mortgage Disclosure Information

Act

RESPA


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The Technology is Waiting For You

The Efforts of MISMO continue to makeeMortgages the most secure way to transact.

Why?

Version 3.0 Migrates the standard fromDTD to schema.

Version 3.0 offers end-to-end transparency fromorigination to secondary marketing and servicing.

Version 3.0 reduces the overall costs ofimplementing eMortgages.

Version 3.0 also reduces the of costs to createMISMO compliant applications

by increasing reusability.

Version 3.0 bridges the information gap betweenorigination, secondary and servicing by having a

single reference model.

Version 3.0 bridges the gap between Data andDocuments by placing bothin a single reference model.

BOTH GSEs WILL MIGRATE TOVERSION 3.0 NEXT YEAR.


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Encomia: eMortgage Overview

Where we are today

Large banks were the first eVault customers

Began using it as a line of business (document custody)

Now using the technology to eliminate certain processes such asreview, scanning, QC

Successful eNote proofs-of-concept, limited production

Small and medium lenders using eDisclosures

Next steps for adopters: horizontal implementation across lines ofbusiness (home equity, student loans, etc.)


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Encomia: eMortgage Benefits

Benefits of eMortgage

Loan origination

Savings of $250 + per loan

Expedites loan funding

Instant electronic loan delivery to investors

Loan custodians

Reduces costs of loan processing and storing

Reduced certification time

Investors

Reduced annual audit expense


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Encomia: eMortgage Obstacles

Obstacles to eMortgage

Slow adoption at FHA/Ginnie Mae, with market share around 40%

Recent widespread chaos in the financial arena.

Ongoing acquisitions among the nation's largest banks

Lack of support among the 5-6 largest Investors/Servicers

Narrow definition of ideal eMortgage originator

Bank (no interim funding required) Minimal FHA volume

Primary investor is Fannie Mae


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Wells Fargo: eMortgage Overview

Where are we at today

Servicing

Strategic direction

eMortgage Vendors

Authorization

Process

Proprietary solutions

Adoption

Industry Forecast

Industry Education

Lender Benefits

MISMO standards

eMortgage

Data type


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Wells Fargo: eMortgage Benefits and Obstacles

Benefits

Reduced investor risk

Exception based processing

Obstacles

Recent widespread chaos in thefinancial arena.


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Churchill Mortgage: eMortgage Overview

Medium size correspondent lender in business since 1992

Started as a broker and became a correspondent lender in 2003

Began slowly with eDisclosures in early 2008

Easily integrated eDisclosures into our existing platform

Complete eMortgage initiative slowed down in late 2008 due to resource

limitations

Currently working with our Warehouse Banks to ensure their acceptance

of eNotes

Recently began working with our primary title company to facilitate

eClosings


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Churchill Mortgage: eMortgage Benefits andObstacles

Benefits

-Faster borrower commitment

-Reduced borrower rate shopping

-Improved internal workflowbetween departments and

eliminated lost paper documents

-Improved re-disclosure receipt time

Obstacles

-Warehouse lines accepting eNotes

-FHA / Ginnie Mae adoption


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Flagstar Bank: eMortgage Overview

eNote Originator, Servicer, Custodian,

Warehouse Bank, Investor & Seller

First eNote Registered in October, 2007

Retail, Broker, Correspondent business

channels

- Nearly 500 different originators

eClosing ready in all 50 states

- Closed eNotes in 43 different states

Integrated with 3 eClosing Platforms

- Fiserv, Stewart, Digital Docs

Selling eNotes to Fannie Mae and FreddieMac

Beginning eMortgage pilot with

FHA/Ginnie Mae

Realizing benefits everyday


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Flagstar Bank: eMortgage Benefits andObstacles

Benefits

No need to scan or indexdocuments

Post Closing review time issignificantly shorter

Faster purchase times

Errors and omissions are reduced

Increased quality and data integrity

Custodial Note shuffling is

eliminated

Faster Note Certification

Environmentally friendly

Obstacles

The perpetual obstacle to humanadvancement is custom.- John Stuart Mill

Settlement agents

Originators


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Question 1

What do you say to lenders whodoubt the legality of eSignatures?


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Question 2

What do you say to lenders thatclaim the borrower wont do an eClosing?


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Question 3

What do you say to lenders who believe

doing an eMortgage requirestoo much new technology forthem to think about that now?

Q


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Question 4

What do you say to lenders that

want to see the ROI beforethey implement eMortgage technology?

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Question 5

What do you say to lenders that

think not enough county recordersaccept eSignatures for me

to invest in this technology?

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Question 6

How much longer do lenders have to

adopt this technology andstill get a competitive advantagebefore it becomes mainstream?

Q ti 7


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Question 7

Progressive lenders sayit will be virtually impossible to comply with

MDIA, HOEPA and RESPA withoutadopting at least electronic disclosures.

Where do you fall in that debate?

Q ti 8


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Question 8

Should the government more directly

mandate electronic processes?

Q ti 9


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Question 9

Why has eMortgage adoption

been so slow?

Question 10


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Question 10

Whats the best way to get started

when going down theeMortgage adoption path?

Question 11


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Question 11

What are your thoughts

about industry adoption ofeMortgages throughout this yearand into 2010?

Q&A


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Q&A

Contact the panel:

Anthony Garritano, Mortgage Technology: [email protected]

Andrew Dubinsky, Encomia: [email protected]

Robin Hannah, Wells Fargo: [email protected]

Brian Boike, Flagstar: [email protected]

Dan Jones, Churchill Mortgage: [email protected]