FICS® Lenders Optimize the Loan Process with MISMO Data Standards
Problem: Lenders Need a More Optimized Loan Process
In the wake of today’s ever-changing mortgage industry, lenders are on the hunt for various tools and solutions to help improve efficiency and maintain compliance with the latest regulations from the Consumer Financial Protection Bureau (CFPB). The challenge with using multiple technologies to improve business is ensuring that systems work smoothly together.
One of the most important partnerships a lender must leverage is the one between the loan origination software (LOS) and its document provider. While the LOS handles the core data and provides the engine for underwriting and closing, the document engine must be able to use that data to create the disclosures and documents required by the myriad of regulations, including the new TILA-RESPA Integrated Disclosure (TRID) rule.
One of the greatest challenges facing lenders is that, all too often, different vendors build interfaces using proprietary interface specifications. Because of this, as the amount of data being transferred continues to increase as a result of changing regulatory mandates, the difficulty of supporting multiple different data formats becomes a significant and costly problem for lenders and prevents the flexibility of selecting their preferred vendor for a particular service.
While each vendor has their own reason for maintaining a proprietary data and file format, it carries a high amount of risk for lenders. The company requiring that format could change their required specifications, leaving the lender with few options. But, by leveraging industry-wide data standards, there is a better way to ensure the LOS and document service provider will be able to interface smoothly.
Solution: Working Hand in Hand
In an effort to support better communication between lenders and the vendors they work with throughout the loan process, the Mortgage Industry Standard Maintenance Organization (MISMO) has spent years enacting a set of standards created to more securely, economically, and efficiently share loan information between multiple parties. By adhering to the latest MISMO standards, the mortgage industry and the vendors involved within it are all able to communicate using the same language.
One of the overarching themes MISMO focuses on is the simplified exchange of information between technology systems. By following the latest standards, there is no longer a need to continue supporting a wide range of data formats to communicate with multiple systems. In addition, this helps eliminate the added time and money necessary to translate data into a unique format or create custom integrations for a lender’s preferred vendor.
As a result of the MISMO industry standard, lenders using a vendor that has adopted the MISMO standards now have the ability to work with a much wider range of compatible service providers. In addition to the benefits of a lender being able to select the document service provider of their choice, other fulfillment-type providers, such as those offering mortgage insurance, title services, property valuation, flood zone determinations, and credit realize the same benefits. Gone are the days of vendor-locked loan origination systems confining lenders to specific vendors.
The ease of sharing information is evident in building interfaces between Financial Industry Computer Systems Inc.’s (FICS®) Loan Producer® LOS and the leading document providers in the mortgage industry. Leveraging MISMO version 3.3, FICS’ Document Services Interface seamlessly transfers loan data, allowing any vendor adhering with this MISMO format to interface directly with FICS users. Since implementing the standards into their own systems, FICS has collaborated with multiple third-party document services providers to offer the best options for mutual customers. While each document service provider has its own system for capturing data elements and producing their documents, FICS has worked with these providers to maintain adherence with MISMO standards.
Results: MISMO in Action
A key benefit of abiding by a common data specification and interface is the ability to effectively work and communicate with any vendor leveraging the same standards. By implementing the latest MISMO specifications, FICS has opened the door for its customers to select the document services provider that best meets their unique needs.
In the face of changing industry regulations, Charlotte, North Carolina-based Charlotte Metro Federal Credit Union found the flexibility in selecting their provider, ComplianceEase, to be especially beneficial as they began to prepare for the new TRID regulations to take effect.
“Having FICS work seamlessly with ComplianceEase® has been a huge help for us, particularly as we began to make the necessary preparations for TRID,” said Randy Kegarise, vice president of mortgage lending for Charlotte Metro Federal Credit Union. “We all read the information and sat in on the webinars, but it was a great comfort to have two companies on our side that had the information we could use to verify what we’d seen and heard in a practical sense.”
Along those same lines, Los Angeles, California,-based Los Angeles Federal Credit Union noted a significant change in the speed and preparation with their document management with the help of their document service provider, Docu Prep.
“Gaining the ability to choose our own document services provider has been a major benefit for our institution as we have seen a major increase in the overall speed and efficiency with which we are able to manage our documents,” said Ron Welcome, assistant vice president of lending for Los Angeles Federal Credit Union. “We consistently see changes and updates being implemented into the system much faster than with our previous document provider. If we ever run into any issues, Docu Prep and FICS are able to figure them out and get back to us with an answer.”
A customer of FICS’ for more than two decades, Lewiston, Maine,-based Rainbow Federal Credit Union found the ability to select DocMagic as its document services provider to be a welcomed addition to their existing loan process.
“With the ability to select the document services provider that best fit our needs, we were able to definitively identify DocMagic as the technology vendor that would help us the most,” said Debra Conrad, senior loan officer for Rainbow Federal Credit Union. “Working directly with DocMagic and FICS has been a smooth process for us thus far. We’ve been very pleased with how both companies have worked to resolve any issues we’ve encountered.”
Outside of ComplianceEase, DocuPrep and DocMagic, FICS customers also have the ability to use the document service interface with multiple other document services vendors such as Docutech, PPDocs, MRG and others.
Ultimately, lenders need the freedom to select the tools that best help them be more efficient and effective for their customers. By building MISMO data standards into FICS’ Document Services Interface, lenders are able to work with the document providers who can help them remain compliant and deliver the necessary documents to borrowers quickly, accurately, and efficiently.
Founded in 1983 and headquartered in Dallas, Texas, Financial Industry Computer Systems, Inc. (FICS), specializes in providing flexible, comprehensive residential and commercial technology solutions to the mortgage industry. FICS' systems are designed to operate on Microsoft® Windows® platforms with the most recent solutions written using .NET Framework that include a rich Windows® Presentation Foundation user interface and multi-tiered shareable services. FICS also provides innovative document management and web-based capabilities into its full suite of products. Additional information about FICS is available via the company's website www.FICS.com.