By Scott Fecteau

Advanced Rules Engine Integrated with Intelligent Forms Creation Eases Compliance Burden

In today's highly regulated mortgage marketplace, lenders are acutely aware of the constantly changing rules and regulations and, more importantly, the burden of maintaining strict compliance in this environment. The risk of non-compliance and costly penalties has grown significantly. The last thing a lender wants is for regulators to come in and find compliance issues. Therefore, lenders are looking for ways to mitigate risk and ease the burden of remaining compliant in the face of all of these changes. In addition to dealing with the influx of changes, lenders are running "leaner" operations to optimize costs while maximizing market opportunities.

It is within these market conditions that technology can be a great enabler. In order to more effectively comply with these constantly changing rules and regulations, Associated Bank has embraced automation solutions that enhance our ability to respond to regulatory changes with great operational efficiency. It is a strategic partnership with one of our trusted vendors that provided the automation solution we were looking for.

At Associated Bank, we can dynamically create initial disclosures and closing packages and deliver them securely to the borrower or settlement agent. Also, accurate and quick document preparation and delivery through our comprehensive technology platform accelerates the lending process and ultimately increases customer satisfaction while maintaining compliance and reducing costs.

The intelligent forms creation/doc prep technology we leverage works in concert with our enterprise lending solution (ELS) to provide 100 percent data transfer into the required documents, leveraging import/export functionality to push and pull data to dynamically generate document packages while nearly eliminating the need to manually complete missing files. By reducing manual entry efforts, we are not only gaining efficiencies but also decreasing costly data entry errors. In addition, all of the necessary calculations take place natively within our system of record removing the need to maintain an interface to a separate third-party doc prep provider and preventing disparate data on multiple platforms.

With the current tempo of business and constantly changing regulations, lenders must be able to institute policy and process changes quickly to gain and maintain a competitive advantage. The combination of our intelligent forms creator and rules engine allows us to provide dynamic data flow to best leverage internal strategies as well as provide time and cost savings with increased scalability and profitability.

Our rules engine is utilized throughout our fully integrated enterprise lending system, extending to areas such as document management/distribution, product and pricing, decisioning, fees, workflow, messaging, security and more. This technology allows non-technical mortgage professionals to easily and effectively modify and customize our solution to better respond to industry changes.

In the past, we were more dependent upon personnel to perform manual tasks, but now we can use automation to streamline our lending process. This automated process includes data driven workflow and auto-resolution capabilities that greatly improve efficiency while mitigating the need for additional training. In turn, this significantly increases employee efficiency and customer satisfaction.

Lenders who embrace automation by fully integrating their document preparation and enterprise lending solution with a robust rules engine will gain significant benefits. For instance, the need for internal staff maintaining documents and compliance is virtually eliminated allowing those resources to be reallocated within the organization. Also, doc packs are automatically generated at the time of application based on the applicant's specific information without the need for manual intervention. New Regulation Z initial disclosure timing requirements are electronically met with a full audit trail, which is dated and time stamped to ensure compliance. Finally, workflow automation provides milestones, tasks and check points within the lending process to streamline operations. As a result, this leads to better data quality and transparency to avoid costly non-compliance issues and penalties.

Lenders who are looking for ways to mitigate risk and ease the burden of maintaining compliance in the face of numerous regulatory changes would be well served to look for specific attributes in a comprehensive document preparation and management automation solution. These include the following:
 

• Vendor that has extensive compliance expertise. With the number of new rules and regulations and the amount of changes taking place, it is extremely difficult to try to keep up with all of these changes internally, which makes it critical to partner with a vendor that has extensive knowledge and expertise on staff. This staff must constantly monitor the regulatory activity, proactively implement changes in a timely manner and regularly communicate the regulatory changes to the clients and how the lender's business is impacted.
• Advanced Automation Solution. The document preparation should be fully integrated with your enterprise lending solution (ELS) and robust rules engine to allow for automation to streamline the preparation of documents in the most efficient and compliant manner. This solution is one that eliminates the need to interface with third party external doc prep providers in order to significantly reduce the need to manage multiple systems of record. A fully integrated solution will provide workflow automation that reduces the dependencies on manual processes while improving data quality.
• Full Document Support and Compliance backed by Warranties. This solution must support document preparation for first mortgages, second mortgages, HELOC's and reverse mortgages while handling both initial disclosures and closing packages. Also, the solution should include an extensive forms library including Fannie Mae, Freddie Mac, FHA and VA programs, federal and state disclosures and a wide variety of private investor products along with the ability to create custom forms. A library that is continually updated to accommodate changes in agency guidelines (federal or state) and compliance rules and regulations should also be standard. Not only should the solution Rep & Warrant the documents, (standard protocol) but because it is fully integrated with the enterprise lending solution, it should also Rep & Warrant the calculations, taking compliance to the next level.
• Secure Electronic Delivery. With an advanced delivery solution, the typical time consuming manual mailing process and delivery of initial disclosure packages is a thing of the past. Initial disclosures are now automatically generated and placed on a secure website. The borrower is immediately notified via email of the disclosure availability and provided instructions for downloading and electronically accepting their disclosures via an e-Sign compliant process, taking you one step closer towards the realization of eMortgages. Additionally, the three-day window for those disclosures to be delivered to the applicant is upheld via a reminder notice. Finally, the solution should automatically store the completed document package securely in PDF format within the system of record for easy retrieval and tracking in the future.
• Ease of Use and Maintenance. A comprehensive document preparation and management solution needs to be easy to use
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