We often hear the question, what is URLA, and how does it affect the way we lend.
URLA is the acronym for the new Uniform Residential Loan Application, a document approved by the Federal Home Finance Agency for use by lenders taking residential mortgage loan applications from borrowers with the intent to sell the closed loan to either Fannie Mae or Freddie Mac. With URLA the lending industry moves closer to digitizing the loan origination process.
How URLA maps to MISMO
URLA will become the new Fannie Mae loan document number 1003 and Freddie Mac document number 65. It expands on the previous versions of these documents but requires additional information from borrowers that was not required in previous versions. As a result lenders will comply with the updated specifications of the Fannie Mae Desktop Underwriter® automated underwriting system (AUS). The GSEs also created a Uniform Loan Application Dataset (ULAD) to show how the data is mapped to MISMO® v3.4 data.
The GSEs made a joint announcement about the initial release of the redesigned Uniform Residential Loan Application in August 2016, making it the first substantial revision to the form in more than two decades. The original plan was to reorganize the layout, add new data fields (including mobile phone number, email address and military service history) and make the information simpler for technology to ingest.
Why the delay with URLA?
The GSEs had hoped the new forms would be in use by 2018, but URLA was delayed in 2016 due to industry complaints about the “homeowner’s preferred language” question. The FHFA ultimately decided to add the language question in October 2017, and moved out the implementation deadline to 2020.
Recently, the GSEs issued a new joint timeline for implementation that will see the new URLA in use by all lenders by November 1, 2020 and all old forms retired one year later.
Mortgage Cadence Senior Manager for Marketing Dan Green has gone on the record with his prediction that URLA-related changes will be more significant for the industry than TRID. Smart lenders will remain vigilant and ensure that their LOS providers are making the required changes that keep them compliant.
To find out more about how we are supporting our lender partners through these changes, reach out to us today