If your policy is written, systems are configured and checks and balances are in place, pricing disparity should not be an issue that your company needs to face in an exam. You can clearly demonstrate a highly efficient methodology that looks at the individual client’s facts and figures when evaluated for a price/rate AND can prove that methodology through the use of your technology.
To start your checklist for the Optimal Advantage Workflow, you have to start at the beginning of where the data is priced; and that is your pricing engine. Carefully consider the following Steps.
Loan Qualities That May Affect Pricing
Step One: Understand How Risk Adjustments (LLPAs) Affect Loan Pricing at Your Company. Each product line or investor may have different adjustments.
Step Two: Understand How Those Risk Adjustments are Configured in Your Pricing Engine. Spend some time with Secondary so that they can show you how the pricing engine automatically prices with the LLPAs configured into the rate per individual client.
Step Three: Understand How Pricing Exceptions are Made and Most Importantly how this will be communicated to you? Someone at the company needs to take ownership of tracking the pricing exceptions to make sure they are being applied fairly and with equal regard.
Step Four: Request Access From Secondary Marketing for Historical Pricing and Ask Them to Show You How to Use it. Also learn how to price trace a loan back to market. This will illuminate where the rate/price came from. We have Webinars posted to our site that will assist you in learning this process.
Step Five: Work With Secondary to Decide What Fields Should be Communicated onto Your Loan Detail Page. The goal is to use the technology to your benefit in an exam as you achieve easier workflow if the data is organized and in one place.
Step Six: Have Secondary work With Your Optimal Blue Account Manager to Decide How to Communicate Those Fields to Your Pricing Engine from you LOS or lock sheet.
Step Seven: Define your compliance management workflow from the examples provided this week in the discussion group. Secondary and Compliance need to work together to accomplish a successful workflow within the company, and one that will pass the exam.
Items That May Affect Pricing: From the list below add to your checklist any pricing adjustment that may occur at your company based on pricing. How will you reference these during the lock in compliance review?
•Product Type
•Loan Type
•DTI
•LTV
•CLTV
•HCLTV
►Drawn vs. Line
•Amortization Type
•Refinance-No Cash Out
•Refinance-Cash Out
•Refinance-Special Program
•Owner Occupied
•Second Home
•Non-Owner Occupied
•Waive Escrows
►Impound Insurance Only
►Impound Taxes Only
►No Impound Account
•Adverse Market
•State Adjustment
•Number of Units
•FICO
•Previous Bankruptcy
•Previous Foreclosure
•New Construction
•Construction Financing (funds to build)
•Construction-Perm
•Condo
►Attached
►Detached
►% Investor Concentration
►Deed Restrictions
•Number of Stories
•Coop
►Breakthrough Purchase/Refinancing
•Manufactured Home
•PUD
•Foreign National
•Lock Extension
•Re-lock Change of Circumstances
•Loan Balance
•Short Sale
•Float Down Option
•Long Term Lock
•Lead Source
•MI Coverage %
•Self Employed
