Take control of your risk.
Risk management is one of the most important aspects of the business of originating and servicing mortgage loans. Managing risk can be challenging in the press of everyday business, so we’re making it a little easier.
These risk self-assessments provide tips and checklists to help mortgage seller/servicers effectively and efficiently manage risk. Use them to identify gaps and develop customized action plans to maximize your risk management.
Seller/Servicer Risk Self-Assessments
Self-Assessment Appraisal Management
Appraisal Management and Appraiser Independence Requirements
Appraisals are among the most time-consuming parts of the loan origination process, and are also a source of risk. With that in mind, we want to take a fresh look at our appraisal management processes to improve efficiency and be sure we’re managing risk effectively. We know there are Appraiser Independence Requirements that we must comply with and want to get it right, but it’s been awhile since we looked at that. How can we check our compliance?
Self-Assessment Business Continuity
Business Continuity and Disaster Recovery
We have a successful and well-run business, but we feel vulnerable to external risk factors. For example, a recent hurricane caused a loss of power at our headquarters. Our employees couldn’t access the company network remotely, forcing our business to close until power was restored. We could have minimized significant business loss if we had a contingency plan in place to ensure critical business operations. What elements go into an effective business continuity plan to protect our business from unexpected events or disasters?
Self-Assessment Change Management
We want to update our current loan origination system and processes. Our objectives include making better use of digitization and offering our customers a smoother experience. We need to be smart about how we manage through it to make the transition smooth for our staff and to avoid disruption of critical business processes. What steps can we take to achieve our objectives while ensuring that we continue to meet Fannie Mae requirements during implementation?
Self-Assessment Condo Project Review
Condo Project Review
We’ve been looking at ways to expand our business and would like to begin originating condo loans. We know it will be a big step in terms of underwriting and risk management. What are the risks regarding the condo loan origination process? What are the considerations for staffing this function? What else do we need to know?
Self-Assessment Enterprise Risk Management
Enterprise Risk Management
We would like to expand our business to include a wholesale channel for loans originated by mortgage brokers. This expansion supports our future vision for the business, but we also know it will increase our risk exposure and require thoughtful management. One big question we’re unsure about is whether we have the knowledge to establish the appropriate risk management processes and controls. What factors go into a strong enterprise risk management program?
Self-Assessment Fidelity Bond
Fidelity Bond and Errors and Omissions Insurance
It’s time to renew our professional liability insurance policy. Managing insurance is one of those routine tasks that could use a little more attention – we’ve also found that our documentation is not centralized, creating additional burden on staff to locate the policy and coverage requirements. We know it’s critical to document, monitor, and evaluate our Fidelity Bond and Errors and Omissions coverage, but where do we begin?
Self-Assessment Internal Audit
We don’t currently have an independent internal audit function. We want to establish one to have assurance that we are meeting our regulatory requirements and demonstrating good-faith business practices. How can we incorporate a risk-based approach to help drive internal audit decision-making?
Self-Assessment Loan Data
Loan Data and Documentation Delivery
It’s important to us to manufacture high-quality loans and deliver them to Fannie Mae with the correct data. We know that errors such as delivering loans with missing or incorrect special feature codes could lead to repurchase requests or unexpected fees. What best practices can we incorporate to do the best possible job of verifying delivery requirements and validating the accuracy of our data?
Self-Assessment Registration Systems
Mortgage Electronic Registration Systems
Our small mortgage company is growing and needs to adopt new practices. For example, to continue expanding our investor relationships, we need to begin using the Mortgage Electronic Registration Systems (MERS) to track loans, servicing rights, and security interests. How do we get started?
Self-Assessment Quality Control
We really care about quality control and feel like we do a pretty good job of it. But we know QC can always be better, and we want to revisit our QC plan. We want to put everything on the table – maybe even consider outsourcing some of our QC functions that we’ve always done in-house. There’s a lot to consider. Where should we start? Are there recommended ways to identify gaps in our current processes?
Self-Assessment Servicer Performance
We are a Fannie Mae servicing partner, and in an effort to reduce our risk and improve our operations, we want to analyze our performance in managing our Fannie Mae book of business. We are also looking for best practices and guidance to align our performance with Fannie Mae goals and adhere to the Servicing Guide.
Self-Assessment Third-Party Originations
We plan to expand our retail business by offering mortgage broker loan originations. Our challenge is ensuring that the third-party originators with whom we partner are producing quality loans that meet requirements for us to deliver them to secondary market investors like Fannie Mae. What written policies and procedures should we put in place to adequately approve and monitor third-party originators?
Self-Assessment Vendor Oversight
Vendor and Third-Party Oversight
To supplement our growing company’s small staff, we want to outsource our technology support services to a third-party vendor. We’re used to doing everything in-house – this will be our first experience with outsourcing, and we’re looking for guidance. What should we know about evaluating and managing external vendors?