ONE OF THE BIGGEST GAPS in our trillion-dollar industry is the availability of a single data repository. Significant progress has been made to strengthen the mortgage industry's infrastructure, ensure the governance and structure required to improve loan quality and loan-level transparency, and monitor industry adherence to guiding principles. While we have addressed issues surrounding compliance, loan quality, transparency and risk, the industry has not yet adopted a plan for a cohesive single data repository to mend investor confidence, deliver life-of-loan transparency, report industry loan data trends and optimize efficiencies.
A single data repository containing pertinent loan-related information from multiple sources incorporates loan data from closed loans, ongoing performance data, and current property and valuation data throughout the loan's life. The present fragmented structure does not adequately represent loan performance and trusted loan-level data to the satisfaction of investors and regulators.
While specific loan data would be controlled by the owner of the loan until disposition, loan-level and aggregate data would be accessible by industry stakeholders through approved and regulated controls and user-identified access rights only. Consumers of data include originators, closing agents, aggregators, govern ment-sponsored entities (GSEs), investors, mortgage insurance companies, regulators, vendors, lenders and servicers. The intent of a single data repository is to improve sharing of specific data and access through standardized information exchange.
The single data repository containing documents and the underlying data could be an extension of, or combined with, the developing common securitization platform (CSP), assuming the CSP will support secondary market activities for all investors and related securitization activities. The continuation of various systems would encourage the continuation of unnecessary ambiguity.
Equally important to the availability of a single data repository is the population of trusted data provided by the originator. Multiple problems exist:
* Lenders are subject to as many as six quality-control points throughout the origination and securitization process, and include duplicative quality-control processes and checks;
* Source documents and data are revalidated by multiple parties;
* Lack of industry standards for indexing, storing, packaging and shipping loan file documents;