Whether your company staffs a chief risk officer, chief appraiser or director of valuations, there's an office where the proverbial “buck” stops on collateral valuation issues. In today’s world, where valuation regulations and expectations have been redefined, we can point to numerous situations in which change has needed to occur quickly and has required technology to get there. Enter the CTO.
We’ve grown accustomed to the days when IT’s role in valuations was to ensure the person(s) responsible for appraisal ordering had a functioning e-mail account, or to provide the underwriting team with functioning computers and access to a photocopy machine. How times have changed.
Valuations can no longer be independent of real, CTO-supported technology. Appraisals are now almost exclusively transmitted via XML and when they are not, PDF extraction technology must be employed. Automated valuation models (AVMs) are ordered through software-as-a-service (SaaS) solutions or XML feeds; and all through the pipeline, your LOS, AMCs and document retention services must stay connected, all while delivering the required data to Fannie Mae and Freddie Mac through Uniform Collateral Data Portal (UCDP) in a Uniform Appraisal Dataset (UAD)-compliant fashion. Consider how many of those terms in the last sentence even existed 10, five or even two years ago. Yes, the world is changing, rapidly, and the greatest ally a valuations expert can have is the person who can open the technological gateway to a swiftly flowing mortgage pipeline.
In the world of valuations, we speak in terms of USPAP, AVMs and the ASB, while our counterparts in IT are caught up in DRPs, BRDs and PIIs. So what can you, the valuations stakeholder, deliver to the CTO to speak his/her language and get your integration project moving?
We counsel our clients to come to an early understanding on the short- and long-term goals for new technology. Documenting these needs will be the first step in delivering on your CTO’s first request: An SOW, or “scope of work” document. Sometimes, these needs are as black and white as the regulations themselves. Other times, they may be part of a valuations “wish list,” offering more qualitative benefits to the valuations team. Either way, identifying the requirements so IT can create a road map will put your IT relationship and overall project on stronger footing.
Secondly, initiate an early introduction to your vendor’s integrations team. Ideally, this introduction should instill confidence in the vendor and an understanding of what lies ahead. When this is not the case, understanding concerns upfront and making necessary adjustments will save considerable effort down the road.
One final word of caution: Don’t be fooled into thinking cloud technology will get you around talking to your IT team. True, cloud technology has alleviated considerable burden for in-house technology teams, but like all things valuation-related, outsourced services do not equate to outsourced responsibility. Bring your technology team in early to validate the security and reliability surrounding the application and feel confident your data is safeguarded.
David Rasmussen is senior vice president of operations at Veros Real Estate Solutions. For more information, call (714) 415-6300 or visit Veros.com.