URLA Re-Design and ULAD…Ready When You Are

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As a part of the overall standardization efforts of the government sponsored enterprise (GSEs) Fannie Mae and Freddie Mac as directed by their regulator, the Federal Housing Finance Agency (FHFA)’s Uniform Mortgage Data Program (UMDP) is the latest “U” initiative coming to market is aimed at the loan application.

Everyone from the borrower, to the loan originator, quality control vendors like LoanLogics and the secondary market will be touched by these mediums.  That’s why it’s important to talk with your technology providers about their readiness for these substantial systematic changes.

One of the most significant change in the new Uniform Residential Loan Application (URLA) design is that it will be presented in a style that follows the spirit of the Loan Estimate and the Closing Disclosure.  A sleeker look and feel highlighted by the fact that it will present only the applicable data.  

Also new is the corresponding Uniform Loan Application Dataset (ULAD) which is the “digital” companion to the new URLA.  This dataset is a machine-readable document in XML format that follows the Mortgage Industry Standards Maintenance Organization (MISMO) version 3.4 Reference Model (or dictionary).

Fannie Mae and Freddie Mac announced this month that the overall implementation timeframe will be delayed due to changes to the design of the new loan application form were recommended by the FHFA.  The changes are limited in nature and will include removing some items from the primary form and adding a supplemental form for the now optional borrower details regarding language preference and counseling.

Our product teams continue to ready our systems and processes for these requirements changes as we anticipate the announcement of the new effective date.

Here are some highlights of the work in progress for the URLA initiative:

• Both the original URLA and new URLA as PDFs will be accepted
• Data extraction will support the new data elements
• Automated business rules will incorporate the new data elements
• LoanLogics LoanFacts ™ (a visual and drillable dashboard of all available loan file data from any source with direct links to the specific underlying documents that contain that data.) will populate with data from the new URLA format
• For added visibility, LoanHD® will present auditors with a URLA view/document grouping

There are some additional changes this year for the Uniform Loan Delivery Dataset (ULDD), as well. While the required use date is slated for February 2020 (see URLA Implementation timeline changed below**), LoanLogics completed testing and is in production with these changes as of July 2019. Additionally, notable for LoanLogics clients,

• All of the HMDA demographic information is now included in the Required Data set
• We are improving the error handling to make data remediation easier with plain-language error messages

With more than a decade of experience processing mortgage loan documents, powered by machine learning enabled automated data recognition (ADR) and automated data extraction (ADE) technologies, the introduction of new data elements and documents into our reviews is seamless for LoanLogics systems.  The combination of a sophisticated automated rules-engine that includes these additional data elements within lender tests and an efficient red light/green light approach to identifying and correcting defects, further incorporates these new data and documents into the quality control without disruption.

From pre-close to pre-fund, purified data fuels the accuracy of our loan quality reviews and results in the transparency and assurance the industry strives for, inclusive of ULDD and URLA Phase 3 data standard changes.

For more information on the full capabilities of our loan quality management platform LoanHD® and LoanLogics IDEA™ for data and document processing contact us directly at loanlogicsinfo@loanlogics.com.

**Since this original post date, URLA dates have changed to the following:

• Extended URLA Implementation Timeline:
• August 1, 2020: Limited Production Begins.
• January 1, 2021: Open Production Begins.
• March 1, 2021: Mandate and Pipeline Transition Period Begins.
• March 1, 2022: Retirement Date of old form.

About the Author

Elizabeth Green

Elizabeth Green is Chief Data and Product Solutions Officer at LoanLogics. In this role, she is responsible for the development of the company’s solutions and data strategy, as well as expansion of products, including in the area of collateral risk assessment. Elizabeth is a strategist, solutions architect, speaker and valuation advocate. As a recognized mortgage technology veteran in software product leadership for solutions in residential property valuation, loan origination, mortgage servicing and secondary marketing, she has helped to foster a new level of understanding in property valuation and collateral risk assessment through the application of digital intelligence.