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  • Writer's pictureQC Verify

As originations soar, have you fallen behind in QC?

As we come off of a record setting year of mortgage originations… the Mortgage Bankers Association predicts the final number will be $3.39 trillion…. lenders need to hold fast because the MBA has also forecast that 2021 will bring record purchase volume of $1.59 trillion! Amidst soaring origination volume and the COVID-19 pandemic, lenders have been truly challenged to find and maintain the resources needed to stay on top of evolving pandemic regulation and investor requirements, while responding to a sea of new borrower applications. Technology can help and has advanced significantly since the last season of record-breaking volume in the early 2000s; however, in most cases it is not fully designed to scale in sync with the current levels of change and velocity. The culmination of these circumstances has pushed lenders to once again resort to massive hiring efforts, a scenario that has proven time and time again to contribute to increased errors, misrepresentation and fraud risk. As your organization increases manpower and origination volume under pandemic strife, are your audit and quality control efforts keeping pace?

Escalating Operational Risk

The 2021 workforce infrastructure is definitely a far cry from the last few years. With nearly all employees working remotely, and since the transition to an offsite workforce occurred overnight, the probability of increased operational risk is high. Additionally, new staff are also working from home, making onboarding, training

and transfer of knowledge a legitimate challenge and engendering even greater risk. This type of operational risk may quickly layer as process consistency erodes. In this environment, your overall risk can be expansive due to system and regulatory unfamiliarity, reduced oversight of remote activities, and procedures that may be overlooked under the onslaught of mounting applications, new personnel, and pressure to meet processing turn times.

Juggling QC Under Duress

Quality control requirements have expanded and progressed in the wake of the financial crisis. During this time technical innovation has also evolved significantly, allowing lenders to complete QC oversight and audit processes with point solutions. Although these solutions can be quite sophisticated, it’s crucial that organizations avoid complete reliance on such tools and stay engaged with changing regulation, QC requirements, and investor guidelines. The issue is that the lending industry remains highly nuanced, making it easy to find your organization suddenly out of touch with areas where process gaps and exceptions are developing.

When pressure mounts within a lender’s shop, whether due to escalating volume, regulator volatility, pandemic influence and/or any other issues our industry encounters, QC resources are often heavily impacted. Whether staff with experience are moved to areas with a perceived greater need, QC personnel are not added at a level consistent with volume, or existing staff are not trained in a timely fashion to stay abreast of industry change, QC departments often lack the appropriate personnel to align with organizational and industry needs. Has your organization become too reliant on a technology solution, outside third-party, or simply fallen out of touch with QC practices and confidence in reported results?

Incorporating Hybrid Alternatives

Assimilating new tactics under pandemic influence and record origination volume necessitates a hybrid approach that can successfully leverage all of the options available to your organization. This includes inhouse retention of areas where you have the most experience, in addition to outsourcing functions that may be more tedious to maintain, such as pre-funding QC, investor audits, or oversight of “temporary flexibilities”. The reality is that overreliance on your inhouse QC department, point solutions, or an outside vendor are antiquated approaches to today’s origination challenges. Don’t base your QC decisions on past experience. If 2020 taught us anything, it’s that we have entered new territory. Take this opportunity to fully embrace all of the QC and audit advantages available to you with a hybrid approach.

Quality Mortgage Services has provided a hybrid alternative all along, utilizing Mortgage Analysis Review Software, MARS, as the underlying platform that supports all of QMS’ capabilities. This system is a sophisticated quality control application that is cloud enabled and has been designed for lender use, as well use by QMS, since its inception. Through MARS, QMS provides innovative, cloud-based technology that helps centralize organizational work product, while supporting decentralized staff and auxiliary workforce. Technology that empowers your QC manager to provide and meet organizational needs, while using human capital to the best potential, not replacing people but leveraging your organization’s experience, best practices and proprietary practices.

The 2021 Difference

So as the demand for talent continues, and we migrate to a voluminous purchase market, maximize your experienced personnel by capitalizing on the QMS offering in 2021. You can rapidly move to cloud functionality, increase organizational access to innovative QC technology, as well as tap experienced industry personnel that are trained to help your organization understand and assimilate changing regulation. Energize your teams with access to proven technology and expertise that yields timely, accurate quality control results.

Combat growing organizational risk and fraud risk with a truly unique QC and audit partner, QMS. With QMS, you’ll have the support necessary to address all of your QC and audit needs in a manner that leverages your respective talent and best practices. QMS is a veteran-owned quality control and audit technology solutions company, as well as a dedicated member of the Mortgage Bankers Association (MBA), committed to both the industry and your valued customer base in meeting the challenges of COVID-19 and delivering quality product to investors. Visit us at to see how our team can assist in navigating this difficult time.

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