Quality Control File Audits


Why should I do quality control audits?

Mortgage quality control file audits are not only required by many agencies and investors, but are considered a good business practice; our high quality, flexible QC reports will help you know how to improve the quality of your loans and reduce risk.

We can perform many types of quality control file audits for your organization, including:

  • FHA
  • Early Payment Default (EPD)
  • VA
  • Cancelled/Denied
  • Fannie Mae
  • Streamline
  • Freddie Mac
  • Fraud Detection
  • HECM (Reverse)
  • Due Diligence


Learn more– Click an icon under “Contact Us” to get started or to request pricing andsamples. 888-556-0796

 

What needs to be audited?

 

Agency:

Fannie Mae

Freddie Mac

FHA

How much to audit: Audit at least 10% of all residential mortgage loans, plus pre-funding & discretionary reviews Audit at least 10% of mortgage loans Audit 10% of FHA loans originated, 100% of EPDs, 10% of rejected applications
How often to audit: Audit at least monthly Every mortgage must have chance of being selected for review within 90 days of Note Date

Audit monthly if closing more than 15 loans/mo.

Audit quarterly if closing 15 or fewer loans/mo.

Required turn times: Select loans for review within 30 days of closing, review within 60 days of selection Report audit results to management within 90 days of selection Review loans within 90 days of closing
Retention Requirements:

Retain reviews for
at least three years

Retain reviews for
at least three years

Retain reviews for
two years

Field Review Requirements: Perform field reviews on 10% of loans audited Perform field reviews on 10% of loans audited Perform field reviews on 10% of loans audited
Important Things to Remember: Lenders must notify Fannie Mae if their QC cycle is in arrears more than one 30-day cycle Lenders must document all credit inquiries up to 120 days Approved mortgagees must perform reviews of their sponsored TPOs
Where to Find the Requirements: Fannie Mae Single Family Selling Guide Subpart D1 Freddie Mac Single-Family Seller/Servicer Guide Chapter 48 HUD 4060.1 Chapter 7, ML 2011-02

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Why should I use Mortgage Compliance Advisors?

Experienced staff

  • MCA combines years of mortgage experience into one convenient source to provide you with comprehensive, accurate solutions. Our auditors have spent several years as underwriters, closers, processors, funders, etc., and they know what to look for to keep you compliant.



High quality information

  • Because of their experience, our auditors know what advice will help you most. We check your files for compliance with required guidelines, ways to reduce your risk and improve your process, common trends, and suspected fraud.



Flexible trend reports

  • Our new web based QC reporting system will allow you to run customized reports on common audit findings, trends, loan scores, underwriter performance, and any other specific information you need.



Excellent customer service

  • Right when you call, we pick up the phone. You will talk to high level management to get answers to your compliance questions and to discuss findings on your reports. We also answer electronic requests generally within one day.



Fast turnaround

  • Information is more valuable to you when it is timely. You will receive a management report within 30 days from delivery of files. This is also especially helpful because approved lenders are required to notify Fannie Mae if their QC cycle is behind more than 30 days.

 

How does the QC audit process work?

After you sign up with us, getting started with the audit process is simple.

To make the process easier for you, we will send you a reminder every month or quarter to send us your closed loan list. Most of our clients have us make the random selection for the audit, but you may request to make your own selections. Furthermore, you may use Blitzdocs or Virpack to upload your files instead of our secure web folder.

 

What is included in the audit?

Re-Verifications

Once you upload the files, they are entered into our proprietary workflow/audit software, which helps us move every file efficiently through the audit process and maintain our 30 day turnaround. Before the audit, we prepare each file and re-verify income, employment, and assets. We also order a new credit report to compare with the credit report in the file.

File Review

After file preparation, one of our auditors thoroughly reviews each file using our audit checklist, from initial application through the final closing documents, making notes of any findings. Our audit checklists have been developed to meet Fannie Mae, Freddie Mac, HUD/FHA, and VA guidelines. We continuously review and update our audit questions so that the information you receive is accurate and up-to-date with the latest regulation changes.

Appraisal Desk Review

Each of our mortgage quality control audits includes an appraisal desk review as part of our process. We will review the appraisal and comment on any items that may not have been addressed by the underwriter or appraiser.

Findings Report

Once the auditor reviews the file, MCA’s project managers review the findings and then pass them to senior management for final review. In effect, your files are reviewed three times to ensure quality and accuracy. Our final report to you includes an executive summary, trend tracking, and detailed findings for each loan audited. You will also have access to our online QC reporting tool to run your own customized reports. You can then use these findings to take any necessary actions to correct issues.

Added Value

Once you sign up with us, you will receive added benefits to help you stay compliant:

  • Up to one hour of consultation each month
  • Access to our online QC tool to customize and share QC reports
  • Reminders to send closed loan reports each month or quarter
  • Emails about important breaking news, including:
    • Our summaries of the issues in plain English
    • Reminders of industry deadlines
  • Subscription to the MCA Monthly Compliance Update
  • Free monthly Webinars and Roundtables on topics chosen from client requests

 

How long does the audit take?

Our mortgage quality control audit service is fast and accurate. We consistently meet our goal of sending management reports back to our clients within 30 days of receiving the files to audit.

How easy is it to transition to MCA?

Transitioning from another QC company or from an internal system is simple.

All we need is a short questionnaire and agreement from you, and we can get you started. After you send us your closed loan list, we’ll send you the list of loans selected for audit and the instructions to submit your files. It takes just a few minutes to set up your web folder, and then you can just drag and drop selected files into our system. If you already use a paperless system like BlitzDocs or Virpack, we can retrieve the files directly from the system.

What if we already do our QC internally?

Some people worry that if they outsource their QC audits, their quality control employees will be put out of jobs. On the contrary, we are here to help your company, not to put your QC team out of jobs. In fact, many of our clients find that we enhance their quality control, and their QC team then helps implement the suggested improvements. Whether you want to send us all your files, just your overflow, or special projects, we can help.

Benefits of Outsourcing:

  • Variable instead of fixed cost—As your volume fluctuates, you don’t need to lay off or hire any employees.
  • Savings in training—Capitalize on our years of expertise and up-to-date resources instead of dealing with constantly training your own audit staff.
  • Outside input—Have a new set of eyes to look at your files, with no conflicting interests or biases.

 

Where can I learn more?

To request more information, a price list, or to get started, click an icon under “Contact Us” at the top right of the page, or call 888-556-0796.

 

What our clients are saying:

“We just got our first audit report and are going through it now. We are really excited. I can’t tell you how amazing it is to have a fresh set of eyes on something. We want to do better and get better, so it’s good to have experienced professionals looking at this stuff. We are so impressed, we are going to start sending our cancelled files soon.”

“I love the reports your company issues; they are so easy to read. So much better than what we had in the past. Glad I found you.”

“Thank you so much. I am pleasantly surprised with the professionalism and exceptional response time. This seldom happens today.”

“Your staff is doing a great JOB and they always communicate with me if they should ever need anything, or if I sometimes fall behind, which I greatly appreciate.”

“Thank you. This makes a big difference in what is expected. I knew I found the right company to work with.”

“Easy info can be hard to come by. I think I just saved myself hours of research.”

“We are very pleased with the work MCA performed on the files reviewed last month. All-in-all I think the process on your end went more smoothly than I had anticipated.”

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