Mortgage Quality Control - Managing the Process
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Transcript of Mortgage Quality Control - Managing the Process
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© 2010
Mortgage Quality Control
Beyond Compliance
Policies and Procedures, Training Programs and Quality Control
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© 2010
The Need for Quality Process
• Statistics– All New Businesses
• 90% fail in 2 Years• 50% of these fail in 5 Years
– National “A” Wholesaler List• @ 6000 brokers• @ 80% added since 2004• @ 250 on list since 2000
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The Need for Quality Process
• Defining Quality Control– Traditional
• Audit Function• Also known as
– Post Closing Review
– Investor/Agency QC Plan
– New• Business Management System
– States
– Investors/FHA/FNMA/FHLMC
• Also known as “Production Quality Control Plan”
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The Need for Quality Process
• Regulatory Climate
• Risk Management
• Business Growth and Profit
• Employee Satisfaction
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The Need for Quality Process
• Regulatory Climate– State Oversight
• Licensing Process• Audit
– Federal Oversight• Predatory Lending• Federal Law Compliance
– Industry Oversight• Warehouse/Investor Approval
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The Need for Quality Process
• Risk Management– Liability
• Employee Actions– Dishonesty– Competence
• Investor Actions– Suspension– Repurchase
• State Actions– Audit Findings
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The Need for Quality Process
• Business Growth and Profit– Shrinking Volumes– Shrinking Margins
• Efficiency• Pipeline Management• Quantifying Costs and Resources
– Survivability
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The Need for Quality Process
• Employee Satisfaction– Competency– Reliance on Systems not People– Process Management
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Proactive or Reactive?
• Crisis Management – Reactive Model– Management Priorities
• New Production – 75%
– Problem Solving • Time Management Report
– 65 - 80% of Time Spent on Problems
• Predictable Issues• Chronically Repeated
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Hot Spots and Conflict Zones
• Origination
• Processing
• Underwriting
• Closing/Funding
• Post-Closing
• Human Resources
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Hot Spots and Conflict Zones
• Origination– Incomplete Application– Fraud– Rate/Program Lock Issues– Inadvertent Pre-Approval– Customer and Referral Source
Management
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Hot Spots and Conflict Zones
• Processing– Incomplete Submission– Erroneous Submission– Closing Preparation
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Hot Spots and Conflict Zones
• Underwriting/Approval– Process/Flow– Guideline Maintenance– Conditions Management– Regulatory Compliance
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Hot Spots and Conflict Zones
• Closing/Funding– Missing Documentation– Incorrect Information– Pre-Closing Audit
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Hot Spots and Conflict Zones
• Post-Closing– Incomplete Documentation– Fraud Detection
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Proactive or Reactive?
• Business Management – Proactive Model– Management Priorities
• New Production 75%
– Problem Solving • 25% of Time Spent on Problems• Predictable Issues – Manage with System• New Issues Addressed in System
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Proactive or Reactive?
• Does your business rely on YOU?– Daily
• Decisions• Direction• Solutions
– NOT a business– Reactive Model– High % of Failure