Fannie Mae announced Monday that it has integrated its Collateral Underwriter appraisal analysis program with the Desktop Underwriter automated underwriting system and EarlyCheck, the company’s pre-delivery loan eligibility and data evaluation tool. The move, Fannie Mae says, will make it easier for lenders to better assess and manage risk by helping them underwrite stronger loans.
“This integration is the next step in our efforts to make it easier to work with Fannie Mae by helping lenders to efficiently manage risk and build strong, profitable businesses,” said Marianne Sullivan, Fannie Mae’s senior vice president for Single Family Business Capabilities. She called the trio of programs “foundational tools for a strong housing finance system.”
Fannie Mae’s software upgrade is part of an effort it’s been rolling out since the beginning of the year. The GSE introduced Collateral Underwriter to the market in January and has nearly 800 lenders registered as users already, according to the Monday announcement. For some, the new system makes immediate and obvious sense.
“Incorporating certain critical information and findings from Collateral Underwriter onto the Desktop Underwriter findings report is a logical next step,” said David Keeling, SVP and mortgage director at Columbia, South Carolina-based First Citizens Bank. “Underwriters will now be able to obtain a more thorough and holistic risk profile of the overall transaction.”
Breck Tyler, EVP of Trustmark Mortgage Services in Madison, Mississippi, called the collateral information that Fannie’s program provides “simply staggering” because of its ability to get once-difficult-to-get data. He expects the expanded suite to make working with the GSE more efficient.
The National Association of Realtors, however, has been more guarded in its evaluation of Fannie’s new program. Though NAR worked with Fannie regarding policy and development of Collateral Underwriter before the January rollout, some NAR members have been concerned that certain features of the program‒‒like the list of additional comps for possible appraiser review‒‒could add time to the appraisal process and force appraisers to use lower-value, lower-quality comps. And this, according to NAR, could encourage lower-value appraisals.
Collateral Underwriter and its new support programs are free and optional for lenders looking to work with Fannie Mae.