Upcoming changes from the Internal Revenue Service will allow for a completely paperless mortgage application process, according to industry participants. Beginning Jan. 7, the IRS will allow electronic signatures for IRS Form 4506-T, request for transcript of tax return. The electronic signatures will be allowed for tax transcripts ordered through the IRS Income Verification Express Services. “The requirement of a manual signature on the IRS 4506-T was the last significant impediment to a truly ...

A law professor says there is no quick solution to the mortgage industry’s foreclosure mess and the resulting legal chaos, but moving to a single electronic note/mortgage transfer system would solve much of what caused the crisis to begin with. “Massive originations of mortgage loans relying on the sell-to-distribute model, followed by massive foreclosures, have led to chaos in the legal processes to track who may foreclose and sell homes,” said Alan White, professor of law at Valparaiso Law School ...

The former chief executive of DocX admitted to her role in a fraud scheme that duped servicers and relied on forged signatures and employees that could sign thousands of mortgage-related instruments a day. Lorraine Brown pled guilty to charges from the Department of Justice of conspiracy to commit mail and wire fraud. “She was responsible for more than a million fraudulent documents entering the system, directing company employees to forge and falsify documents relied on by property recorders ...

A commissioned study of Ellie Mae’s Encompass360 has confirmed what the company’s clients have been saying all along: the popular software helps lower the total cost of originating mortgage loans. According to the study conducted by Forrester Consulting, a global research and advisory firm in Cambridge, MA, users of Encompass360 realized benefits in improved compliance and greater efficiency as well as a 57 percent return-on-investment (ROI) based on a three-year, risk-adjusted cash flow. Improved ...

GSEs, Private MIs Agree to Drop Pre-Approval Requirements. Fannie Mae and Freddie Mac and the private mortgage insurance industry have agreed to eliminate pre-approval requirements for foreclosure alternatives, such as short sales and deeds-in-lieu of foreclosure. The separate agreements with MIs should help distressed homeowners avoid foreclosure by doing away with costly, time-consuming MI reviews that delay foreclosure-prevention transactions, according to the government-sponsored enterprises. WIMC Fully Acquires Reverse Mortgage Solutions. Walter Investment Management Corp. has completed its $120 million acquisition of ...

It looks like many banks may have been too distracted with loan modifications, foreclosures and regulatory compliance issues over the last few years to notice a potentially vast untapped well of profit in their own back yards. A new consumer mortgage study finds that banks are passing by an opportunity to increase their mortgage business by a whopping 79 percent with their existing customer base. “Thirty-nine percent of survey respondents have their mortgage with their primary bank, the bank with which they do ...

Cyber warfare is heating up in the United States and throughout the world, with “distributed denial of service” attacks up significantly in the third quarter against mortgage lenders and other financial services providers and corporate entities, according to a report released this week by Prolexic Technologies, a vendor of DDoS protection services. During the third quarter, Prolexic mitigated seven DDoS attacks of more than 20 gigabits per second (Gbps) for different clients across multiple industries, the firm said. A number of these attacks leveraged a toolkit called “itsoknoproblembro” that has been used in some recent high-profile DDoS attacks. In a DDoS attack, one or more hackers deploy...

The Federal Housing Finance Agency’s five-year strategic plan aims to develop a “new system” for recording mortgages electronically and assuming custodianship of mortgage documents but is curiously silent about the role the Mortgage Electronic Registration System would play in a future revamped secondary mortgage market. The new system is among many initiatives and strategies outlined in the FHFA’s recently issued updated strategic plan for 2013-2017. The plan builds on an earlier plan for the conservatorships of the government-sponsored enterprises released in February. As part of building a new infrastructure to replace the GSE model, the FHFA said...

The unrelenting pressure to comply with industry regulations and standards is the greatest factor impacting eMortgage and paperless mortgage initiatives, according to a survey by Xerox Mortgage Services. Xerox’s eighth annual Path to Paperless survey found that an ample 86 percent of industry respondents looked to a technological solution to avoid being caught on the wrong side of regulatory enforcement. Mortgage laws, regulations and standards continue to evolve in a direction toward ...

The antiquated backbone of the FHA’s Home Equity Conversion Mortgage program will soon be history with the official launch of HERMIT on Oct. 9. HERMIT, or the Home Equity Reverse Mortgage Information Technology, is a second generation, web-based automated system, designed to improve the Department of Housing and Urban Development’s ability to track and monitor its HECM portfolio in real time. The system also automates the payments of insurance claims while increasing efficiency and mitigating risks to the FHA insurance fund. HERMIT consists of a servicing module and an accounting module to ...