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FHA Title II Mortgage Approval Handbook (4060.1 REV.-2) guidelines state that:

All Quality Control Programs must be in writing. Mortgages must have fully functioning Quality Control Programs from the date of their initial FHA approval until final surrender or termination of their approval.

A mortgagee who originates and/or underwrites 3,500 of fewer FHA loans per year must review 10% of the FHA loans it originates. A mortgagee who originates and/or underwrites more than 3,500 FHA loans per year may review 10% of its loans or a statistical random sampling that provides a 95% confidence level with 2% precision.

The Quality Control function must be independent of the origination and servicing functions.

Mortgagees may engage outside sources to perform the Quality Control function.

Mortgagees must ensure that quality control reviews are performed on a regular and timely basis. Depending on a mortgagee's production volume, origination reviews may be performed weekly, monthly, or quarterly. Loans must be reviewed within 90 days from the end of the month in which the loan closed.

Failure to comply with specific Quality Control requirements may result in sanctions and the imposition of Civil Money Penalties by the Mortgagee Review Board (MRB).

 

 



I am writing to recommend the services of MSource. We have been using MSource for all of our QC and Compliance needs since December of 2009, and have always been completely satisfied. They offer a competitive product package, are very timely in their audits and extremely knowledgeable in regards to mortgage banking quality control and compliance.

We consult with Audrey almost weekly in regards to changing industry standards and guidelines and her years of experience are always very evident.

I am happy to recommend the services of MSource.

- Jessica S.


 

 

Audit and Quality Control

MORTGAGE AUDIT & QUALITY CONTROL OUTSOURCING

Quality Control is an absolute must in all areas of mortgage lending.  Whether you are a broker, lender, or bank you are required to maintain and follow an approved Quality Control Plan.

With fluctuating loan volumes, ever increasing regulatory complexity, and heightened fraud risk, many companies are choosing to outsource certain functions. Outsourcing can provide a cost effective way to manage labor costs and risks. 

Post-Closing Audits

At MSource we review each selected file to ensure conformity with investor requirements, complete origination package,  sound underwriting decisions, and complete closing packages. Our detailed and comprehensive quality audits include underwriting, compliance reviews, red flag reviews, re-verification of critical origination documents, and review of the origination appraisal.

Specific areas of review include:

  • Monitor compliance with federal, state and investor requirements
  • Red Flag Reviews for fraud and misrepresentation
  • Confirm data integrity
  • Re-verify all income and asset documentation
  • Appraisal review to ensure subject property represents adequate collateral
  • Evaluate loan for sound underwriting judgment
  • Closing documentation is reviewed for adherence to required guidelines
  • Disclosure documents are reviewed to determine compliance
  • Reporting with detailed summaries and trend results
  • Ensure statistical samplings and discretionary audits encompass critical risk areas and the full scope of loan programs and service areas.

 MSource is a full service mortgage compliance solution provider.  We can perform mortgage quality control audits on any production volume with effective mortgage auditing and mortgage due diliegnce.  We provide a wide variety of mortgage quality control and mortgage compliance services, including:

                      Mortgage Quality Control Plans            Mortgage Loan Audits

                      Early Payment Defaults                         Mortgage Repurchase Defense

                      Regulatory Updates                                Cancel/Reject Audits

 

  QUALITY CONTROL PLAN

Writing a quality control plan from scratch can be a painfully time-consuming process.  We provide industry standard customized QC Plans, delivered electronically.

 Fully Compliant FHA Quality Plan  Contact Us for more information!

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