Two significant issues with quality control programs used by mortgage lenders have been identified by Interthinx, and the company states that they could pose as major risks to the industry during 2012.
According to the risk mitigation firm, missing documents and the integrity of data on borrowers accounted for 40.9 percent of all mortgage defects during 2011, while eligibility and credit issues were linked to 18.3 percent of borrower issues.
"It's significant when comparing this recent data to data from 2006 to 2009 when missing documentation only accounted for 7.1 percent of all findings," said Interthinx executive vice president Connie Wilson. "If lenders are not outsourcing their quality control processes, they should at least consider having someone from the outside take a look at their processes."
The report identified lenders that have a quality control process that is similar to their mortgage origination process could easily overlook issues with borrower documentation and data integrity.
Additionally, Interthinx advises lenders that don't currently have an independent party backing up their internal quality control process may want to consider acquiring such a service in 2012 to provide safety and soundness for the company.