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The times demand efficiency
This is bonus from “Regulatory Rockslide” in the November 2014 issue of Credit Union Management magazine.
Reclaiming mortgage efficiency requires a responsive organization. The old workflow infrastructure was like paths with crossings. The one that is evolving is more like highways with overpasses, on and off ramps, merging lanes and timed traffic signals. Planners have to anticipate just when a document would become useful and start the preparation well in advance so that document will show up and dovetail into the overall process just when it first becomes useable, explains Matt Abbink, VP/direct lending at CUES Supplier member CU Members Mortgage, a Dallas affiliate of Colonial Savings and an aggregator (mortgage purchaser) for over 1,000 CUs.
“Workflow used to be pretty linear,” he observes. One group would complete one step in the process before handing a file off (sometimes literally) to the next group. It becomes critical that a file be electronic and accessible by all the people who need to contribute to it so that they can all do their parts simultaneously and separately, but within a workflow plan that coordinates every piece along a timeline. For such coordination and precision, electronic documents and transmissions are important, Abbink concludes.
Due to regulatory requirements, processors now have to deal with more mandatory wait periods, he notes. Rather than hold up the whole process, efficient players keep the wheels turning on other parts of the process to minimize wait period delays. “For example, we now do a pre-closing audit review of selected files,” Abbink reports. “We put that earlier in the workflow.”
Converting paper documents to electronic, and automating and timing disclosures with precision, is more important now than ever, agrees Jon Paukovich, VP/mortgage lending at $4 billion Ent in Colorado Springs. “Members are intimidated by all the paperwork at closing, but the regulations require it,” he points out. “The more we can deliver documents electronically, the better we can manage the timing. We’re looking to deliver documents three days ahead of closing so that borrowers have the mandated three days of review time and the loans can still close on schedule.”
Borrowers now have a three-day right of recision on refinancings, but that will apply to purchase loans as of next August, he notes. “That will be a big change. I’m not sure how that will shake out.” rescission
The new disclosure rules coming in August 2015 will require closing papers to be prepared earlier in the process, Abbink says. “We will have to get them in the borrower’s hands as soon as possible, so those papers will have to be prepared as other parts of the process are happening, not after they have been concluded,” he explains.
Richard H. Gamble is a freelance writer based in Colorado.
