Occasionally when I ride my bike to work in the mornings and the weather is bad, my wife will give me a ride home in the afternoon. The boys are in the car and, of course, we’re all hungry. Inevitably, someone always suggests we go out to eat for dinner.
And so begins the night’s episode of “Where to go for dinner: The Endless, Soul-Draining Discussion.”
“I want Subway,” declares my oldest son.
“What about Hector’s?” my wife suggests.
My youngest son doesn’t want anything any one suggests, but has no suggestions.
I want to go to Tap House, but when that gets shot down, I suggest, “How about pizza?”
My youngest doesn’t want pizza, but changes his mind and decides he’ll go for Hector’s. My oldest won’t go for Hector’s, but he’ll compromise for Tap House. And so it goes, on and on in an endless cycle while our options keep dwindling as we pass restaurant after restaurant.
Consensus On a Mortgage Loan Can Be Very Difficult To Attain
Reaching a consensus is a laborious task in many situations. The mortgage industry has a particular difficulty with this task because of inherent issues that constrict the loan process flow.
Reconciling Mortgage Data From Several Sources
Data comes from multiple sources and reconciling that information means reaching out to the necessary parties to ensure it is correct. Currently, the mortgage industry is dependent on each individual facilitating the data, which results in a lot of ‘he said, she said’ situations and a larger margin for error.
Proof Of Mortgage Compliance
In addition, mortgage professionals have to be able to prove consensus actually occurred for regulatory purposes. Obtaining this proof poses a challenge to the industry because there is no audit log tracking all communication and actions during the loan process.
The life of a loan reaches a pivotal point when achieving consensus. The purpose of consensus, after all, is to have approval from all appropriate parties to execute the transaction. However, the industry’s process separates the approved data and documents (consensus) from the actual disbursements.
Without a copy of the check ledger, how does one prove those disbursements went to the correct entities?
Failing to distribute disbursements in the approved manner can result in a TILA violation. This possibility adds an unnecessary layer of risk. Why don’t lenders require a reconciled check ledger post-closing?
Investors and the secondary market are not requiring this. Not yet, anyway.
According to the SFIG’s recent newsletter, however, it appears this type of requirement is in the industry’s future.
The Need For a Mortgage Facilitator
Consensus, along with the disbursements, needs to be managed by a facilitator. The ATS Secured Network provides this level of consensus.
Loan participants can review and discuss the loan data, documents and dollars on our network, much like a virtual dinner table, helping to eliminate errors, redundancies, delays and the like. It mediates discussions to ensure that consensus occurs, and to prove that it does occur by recording all actions and communications with an audit log.
Reaching consensus on a mortgage loan shouldn’t have to be so difficult. As for solving the age-old discussion over where to eat, that’s a whole different bag of chips.
Want to make your mortgage process easier and more accurate? Contact ATS Secured today.