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Do Less and Say 'YES' to More Borrowers with Help from Loan Prospector’s New Enhancements[February 2, 2005]

"This new feature will assist us in identifying and selecting the right financing option for our customers. Getting additional feedback, without having to send extra data elements to LP, is a quicker and more user-friendly process. Our loan officers are excited about the change."

Dan Mekemson
Senior Vice President Johnson Bank

The latest enhancements to Loan Prospector® will automate more of your process and provide additional feedback. These enhancements enable you to:

Reach Out to More Borrowers with the Right Solutions

With Loan Prospector's newest feature, you don’t have to conduct manual calculations to determine if your borrower meets median income and property location requirements for Freddie Mac's Affordable Gold products. Loan Prospector will now notify you if your borrower meets these requirements, whether you select an Affordable Gold product or not.

If you receive this notification, be sure to check out our Affordable Gold products. They provide low-cost solutions for borrowers facing mortgage finance challenges and could be the answer you’ve been looking for:

  • Affordable Gold 5 — only requires a 5 percent down payment and a variety of sources can be used to fund the down payment, closing costs, financing costs and prepaids.
  • Affordable Gold 97 — offers loan-to-value ratios up to 97 percent with more options for the sources of funds that borrowers can use for their down payment.

Enhancement At A Glance
Description
Automatically notifies you when a loan meets median income and property location requirements for Freddie Mac’s Affordable Gold (AG) 97 and Affordable Gold 5 products.
Benefits
  • Identifies low-cost conventional financing solutions you can offer credit challenged borrowers with limited down payment funds.
  • Automates another portion of your process by eliminating the manual eligibility calculations.
  • Extends the built-in credit flexibilities of Freddie Mac’s AG products to more borrowers.
Feedback location
  • New Affordable Product Information section of Full Feedback Certificate.
Recommended processing steps
  • If you submitted the loan as an Affordable Gold Product, no action is necessary.
  • If you submitted the loan as a conventional conforming loan:
    • LoanProspector.com users – Select Affordable Product Type and resubmit.
    • LP Classic® users – Select appropriate Affordable Program Identifier and resubmit.

"LP's new excessive value message, frankly, is the closest thing now available to an integrated fraud detection tool at the front end of the process. This new feature is not only going to protect lenders, brokers, investors and shareholders but also borrowers, especially first-time borrowers and emerging market customers. It's huge!"

Bob Peifer
Executive Vice President & Director of Underwriting US Bank Home Mortgage in Bloomington, MN

Make Sure You Have the Right Property at the Right Value

Loan Prospector now helps you identify potentially risky loans before they close, so you can direct your attention to loans that need it most and make more informed decisions earlier in your origination process.

  1. First, Loan Prospector will verify the subject property address exists and is entered correctly.

  2. Then, Loan Prospector will check the stated value of the subject property against the estimate provided by Freddie Mac’s automated valuation model, Home Value Explorer®, to determine whether it’s consistent with local market values.

If your subject property value appears to exceed local market values, you’ll receive a feedback message in the Loan Processing Information section on your Full Feedback Certificate.

 

 

Enhancement At A Glance
 
Excessive Value Feature
Address Validation and
Standardization Feature
Description
Automatically notifies you when the stated subject property value on a conventional conforming loan is potentially excessive compared to local market property values.*
Matches the subject property address against the US Postal Service database.
Benefits
  • Saves time and potentially reduces risk by helping you direct your attention to loans that need it most.
  • Helps you make more informed decisions earlier in the process.
  • Helps you protect your borrowers by identifying potentially risky loans during the pre-funding process.
Ensures data integrity by confirming subject property address exists and is entered correctly
Feedback location
Loan Processing Information section of Full Feedback Certificate [See example].
New Address Information section of Full Feedback Certificate
Recommended processing steps
  • Review the loan to ensure the stated value for the subject property is entered correctly.
  • Carefully review the appraisal.
  • If changes are made, resubmit the loan
If feedback indicates address cannot be standardized, verify that you have entered the address correctly.
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*Note: The excessive value message is a supplemental resource for identifying potentially risky loans during the pre-funding process. As always, you should continue to follow your normal loan review process to ensure the property value you submit to Loan Prospector is accurate.


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