Investor Solutions
Investors purchase loans made by third party
originators or securities backed by mortgage loans. Non-compliant loans
purchased by third party orginators—in addition to causing great harm to
borrowers—present for investors significant legal, reputation, and other
risks. These other risks include the heightened credit risk assumed in cases
where the borrower lacks the ability to repay the loan without resorting to
foreclosure.
But for investors, ensuring compliance poses special
challenges. Sellers are unaccomodating when it comes to providing the minimum
data required for even the crudest automated review. What's more, any of several
compliance requirements can apply to a loan based on the seller's licensing or
charter authority. Ignoring how a seller is regulated and applying the most
restrictive compliance requirements is a needless approximation that undermines
profitability. Finally, changes at the closing table by the settlement agent can
create non-compliance issues that are difficult to identify.
For these
reasons, Mavent offers special solutions geared towards the complexity, workflow
and data constraints facing secondary market investors.
Automated
Compliance Engine (ACE)
Mavent develops and maintains ACE's that review
seller loan data against Mavent's
baseline
compliance rules, as modified by an investor's own
regulatory interpretations and
internal compliance policies.
Investors can select from Mavent's
baseline
reviews (all of which are maintained current by Mavent and its outside
counsel network) which compliance reviews to perform. Applicable substantive law
will be applied based on the
seller's
license or charter authority, enabling investors to purchase loans that have
more attractive cash flow characteristics without incurring greater risk. Mavent
ACE's can be
deployed in
several ways, based upon secondary market workflow and data availability
constraints.
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information.
Correspondent ACE
The Correspondent ACE
program allows secondary market investors to make their ACE available to their
sellers. This improves client relationships, reduces kick-outs rates, and allows
investors to treat their sellers like true partners by enabling them to close
loans eligible for purchase.
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information.
Seller Licensing Verification and Monitoring
Mavent verifies, and monitors on an ongoing basis, an investor's approved
counterparties to make certain that all sellers remain properly licensed or
exempt, and ascertains whether a seller's license or exempt status grant it the
authority to make a subject loan.
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information.
Counterparty Due Diligence
Mavent supports
investors in reviewing new and existing counterparties to ensure that sellers
have adequate controls in place to originate compliant loans.
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information.
Pool Due Diligence
Mavent provides a
comprehensive regulatory compliance risk assessment of a seller's pool or
portfolio. Mavent utilizes the investor's ACE to ensure the analysis meets the
investor's regulatory interpretations and risk tolerances. The analysis can be
made based on the seller's license or charter auhtority and/or the investor's.
The result is a precise and consistent analysis of a larger sample of loans at a
cost that is impossible for traditional, labor-intensive diligence firms to
replicate.
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information.
Solutions for Investors