Equifax, a US-based provider of information solutions, has launched a new mortgage solution called Undisclosed Debt Monitoring to help lenders comply with Fannie Mae's updated policy regarding borrower liabilities.
The Undisclosed Debt Monitoring solution monitors and notify financial institutions of new accounts and borrower activity initiated during the quiet period, a historical blind spot for lenders.
With this latest Equifax solution, lenders can address Fannie Mae’s guidelines while gaining increased transparency into the underwriting process to uncover undisclosed debt and minimize buyback risk.
A solution that is always on, the Undisclosed Debt Monitoring continuously monitors for new debts or liabilities incurred by the borrower during the quiet period, which spans from the mortgage application date to the loan closing date. Through the monitoring process, the Undisclosed Debt Monitoring alerts lenders of borrower activity that may represent potential risk associated with mortgage loans in their pipelines.
Dann Adams, president of consumer information solutions at Equifax, said: “In light of Fannie Mae’s requirements and faced with the growing challenge of undisclosed debt, financial institutions are looking for new and innovative tools to intelligently mitigate their underwriting risk.
“Equifax introduced the Undisclosed Debt Monitoring platform to equip lenders with a powerful solution to tackle this most important issue in mortgage underwriting. Without greater transparency into loan transaction details, many lenders risk being left in the dark.”