I love going to New York. DC may be the capital of America, but New York is its heart. Some random takeaways from this year’s MBA National Secondary Market Conference …
By Mindy Leisure - Advantage Credit
There are three kinds of public records that can appear on credit reports: Bankruptcy Chapter 13 and Chapter 7, state and federal tax liens and civil judgments. However unlike creditors who are data furnishers like credit cards, mortgage companies, etc., courts do not, in most cases, actually furnish the information directly to the credit bureaus. The credit bureaus have to go out and retrieve that information manually.
The credit bureaus have independent contractors that periodically go out to different courthouses around the country and gather information for credit reports. Some counties have online databases that the bureaus can retrieve information from but not all. Those databases often do not contain all the information needed to accurately report a public record. So the contractor must go to the courthouse and scan all the public records into their computer. These records are then sold to data clearing houses that in turn provides this information to the credit bureaus.
Let’s first look at judgments. The majority of civil judgments do not have social security numbers tied to them, so that information is gathered based on name and address. If a consumer lives at an address that was previously occupied by someone who had a judgment on their credit report, chances are the judgment could end up on the new resident’s credit report as well. Similarly, if a person has the same name as someone with a judgment and live in the same state but not necessarily even the same address this too could result in erroneous reporting. Since the gathering of public record information is mostly a manual process there is a lot of room for error.
Tax liens and bankruptcies have a bit less room for error as they do have social security numbers attached to them. However if socials are similar there is still the possibility that an erroneous lien or bankruptcy could show up on a consumer’s credit report.
Why is reporting public records such a manual process? Becoming an actual data furnisher to the bureaus can be a very difficult process. Contracts must be signed, special software incorporated and the bureaus all have minimums of what a data furnisher must have in order to be able to report every month. Most courts do not have the financial resources to become a data furnisher nor will the smaller courts have the minimum requirements or financial resources needed to be able to report. So bringing in independent contractors to gather this information manually is the only avenue the bureaus have to obtain the data. This method may seem a bit antiquated in some ways but since courts are not data furnishers the credit bureaus have very few options when it comes to retrieving public record information.
Because public records can have such a significant negative impact on credit scores and because there is room for error in the way public records are retrieved is just another reason why it is so important to periodically check your credit reports for errors. In studies done it has been determined that 80% of credit reports contained some sort of mistake and out of those 25% were serious errors. Discovering an erroneous public record on your credit report would definitely be classified as a serious error. It’s important to check your credit reports at least once a year…just in case.
As we head into next week’s MBA National Secondary Marketing Conference in New York, it seems like a good time to use this space to examine the current state of the secondary market in the housing finance industry.
And the current state is one that is focused on what the future state of the secondary market will be.
Never before has there been more uncertainty around what the future state of the secondary market will look like, evidenced by the fact that MBA recently created a task force to help craft a proposal on the future of the secondary market system.
Here’s just some of the questions we’re hearing from our members on the state of the secondary market.
- When will the common securitization platform be announced, and how long will it take to implement it?
- Do you realistically see any major changes coming with Fannie/Freddie in the next couple of years?
- What’s going to happen with the PHH and Quicken lawsuits, and how will it impact the industry?
- How will secondary market investors view loans where income, asset, employment data is imported in as opposed to being on scanned docs?
- When will we see a more robust non QM secondary market emerge?
Our team will maintain a sharp focus on working with MBA and other industry leaders to help get our lenders clarity on these vital issues.
SAN DIEGO, Calif., May 11, 2016 -- The Mortgage Collaborative, an independent mortgage lending cooperative, today announced the addition of 14 new lenders to their national network of originating members, declared the Collaborative's EVP of National Sales & Strategic Alliances, Rich Swerbinsky.
"It’s inspiring to our team hearing about the value great companies like these see in our network," said Swerbinsky. "Being completely independent allows us always to focus on our members first and foremost. This is a challenging climate for mortgage originators, especially small to mid-sized lenders, as mortgage origination costs skyrocket. The technology and innovation in this industry is changing rapidly and lenders are spending more time than ever playing defense. At a time where business development issues and initiatives are paramount to the future success of mortgage originators, we act as a partner to our members in overcoming all of those challenges."
The new member companies are as follows:
The addition of these companies increases to over $90 billion annually the aggregate origination volume of The Mortgage Collaborative's lender members. In the past 12 months, The Collaborative has added 48 new originating lender members continuing the rapid growth for the nation’s only independent cooperative network.
The Mortgage Collaborative also recently announced their Summer Lender Member Conference, which will be held August 20-23, 2016 at the Four Seasons Hotel in Denver, Colorado. The conference provides The Collaborative's lender members a unique opportunity to interact with top industry leaders and to attend and participate in compelling educational and peer-to-peer networking sessions. Details on the conference can be found at www.mortgagecollaborative.com.
About The Mortgage Collaborative:
Based in San Diego, Calif., The Mortgage Collaborative was founded in 2013 to empower mortgage lenders across the country with better financial execution, reduced costs, enhanced expertise and improved compliance and to help its members access the dynamic and changing consumer base in America. The association is managed by its founding members: John Robbins, CMB; David Kittle, CMB; Gary Acosta, CEO of the National Association of Hispanic Real Estate Professionals (NAHREP); and Jim Park, former chair of the Asian Real Estate Association of America (AREAA). Robbins and Kittle are former chairmen of the Mortgage Bankers Association of America (MBA).
For more information, visit http://www.mortgagecollaborative.com/.
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Kerri S. Milam Depth PR
TMC - Chief Operating Officer
President/CEO - Pulte Financial Services