With Mortgage Lending Still at Bottom, Mistakes Are Costly: Talking with Rob Katz, President of DMD Inc., San Diego
2009; American Bankers Association; Volume: 101; Issue: 8 Linguagem: Inglês
ISSN
0194-5947
Autores Tópico(s)Banking Systems and Strategies
Resumo[ILLUSTRATION OMITTED] A former mortgage banker, Rob Katz has been president of Del Mar DataTrac (DMD) since 2008, and has more than 20 years experience in the mortgage industry. The company, founded in 1991, is the dominant provider of off-the-shelf mortgage origination for small and midsize mortgage tenders, according to Katz. DataTrac is the company's flagship product, which Katz describes as an automated workflow platform. The company sells to both mortgage banks and commercial banks, but the ratio has shifted increasingly to commercial banks in the Last 18 months. Katz is a straight shooter and an independent thinker. He is not a fan, for example, of the trend to software as a service--SaaS in shorthand--in which is delivered over the internet, versus the more traditional packaged model. DMD offers a web-services version of DataTrac, but Katz discourages banks from that choice. He recently spoke about that and other subjects with Editor-in-Chief Bill Streeter. What is your thinking about SaaS? Katz In all industries, SaaS is the buzz right now. Avoiding the headaches of managing your own IT infrastructure is certainly appealing, and for many applications it's the right way to go. But I'm not convinced that critical applications should be dependent on the provider as a host. Before deciding if you should use a SaaS solution, you need to decide if getting a Page not found message because your vendor went out of business puts you out of business. What type of origination volume justifies an investment in specialized mortgage software? Katz Many small originators can get by using a paper-based system supported by a point-of-sale tool for Loan officers, such as Calyx Point. Above about 20 Loans per month, however, a manual process begins to break down. You begin to make mistakes, which can be costly. When setting a Loan to Fannie Mae or Freddie Mac, if something is wrong with the Loan--if it's missing a disclosure, for example--it becomes a suspended or broken Loan, which is up to the tender to fix. The fix is hard work, is embarrassing, and takes people away from tending. Broken Loans are more likely to occur as volume goes up if you're not property automated and don't have good, well-trained people. Our system uses business rules to catch potential mistakes in a loan before it is too late. There is a big financial jump from using a simple, basically manual, system where the cost per user is about $100 to a cost of over $1,000 per user for our system, but at some point you have to ask yourself, do we really want to be in the mortgage business? …
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