Tech-savvy lender builds LOS, now integrating with Day 1 Certainty

April 3, 2017 | By

It’s unusual for a small to mid-sized lender to have their own in-house loan origination system (LOS). Most use a LOS developed by outside vendors.

But 400-employee, privately-held Mortgage Network built its own technology to originate, sell, and service loans. It’s an investment in technology that lets the Danvers, MA-based lender design and customize its technology to exactly fit its needs.

How It Started

Mortgage Network started building its own modules around their LOS provider in 2001. And it created data bridges to transfer data between these modules and their LOS. It began this process with the secondary market, building a full hedging and mark-to-market system with its own pricing engine.

It continued to build additional technology modules and bridges over the years. But in 2009, their LOS provider announced it was retiring their legacy platform and migrating users to new technology.

Mortgage Network was unsure how that move would affect its technology. “We had so many modules built around their LOS that we were only using it for taking the application, pulling credit, and running Desktop Underwriter®,” says Carlos Sa, the company’s chief technology officer. “Moving to the new technology would have forced us to give up a number of our modules.”

So instead they built their own LOS.

Read more: Fannie Mae delivers on ‘Simplifying Servicing’ at MBA

It turned out to be a good decision, notes Sa. Having proprietary technology has allowed for fast and efficient upgrades based on input from front-end loan officers who communicate with IT directly.

Day 1 Certainty Integration

Mortgage Network is currently piloting an online portal. The LOS takes a potential borrower through a series of questions and returns the best available scenario for that particular borrower.

The lender expected the system to be fully operational by the end of March. It is integrating the portal with the Fannie Mae Day 1 Certainty™ offering for asset validation. This integration will allow for asset validation through one of Fannie Mae’s approved asset verification report suppliers.

Read more: Fannie Mae offers freedom from representation and warranties (R&W) with ‘Day 1 Certainty’ Initiative

“Our online LOS portal connects directly to the borrower, whereas other LOSs have the asset and income checked via a back-office feature, after the application is taken,” Sa says.

“When a borrower is on an actual online mortgage portal, they may feel more comfortable to either download their bank statements or type in a password for Mortgage Network to read the statements,” Sa says. “We show the borrower online what we are doing with the information and the applicant can choose what to share or not share with us.”

Of course, Sa is quick to note that developing and updating proprietary technology entails time and expense. Still, he believes the benefits have outweighed the drawbacks.

“We’ve always been very nimble,” Sa says. “We can make any changes we want quickly and can make things exactly the way we want them. There are very few limits in terms of what we can and cannot do.”

 

 

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