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Underwriting and Compliance

In any compliance matter, the burden of proof is on the lender. Modern lending technology offers distinct advantages over any manual processes you may currently use to support underwriting compliance, by:

Ensuring process and decision consistency, and preventing manual errors;

Establishing processes that can easily be tracked, analyzed, and audited; and Automatically alerting to identify conditions that are out-of-compliance.  

Achieve Underwriting Compliance  
A modern loan origination system already provides support for several of the well-established regulations. There’s no need for you to start from scratch. The processes and rules to comply with Regulation-Z of the Truth in Lending Act (TILA) are already incorporated into the underwriting workflow. 
Configuration and Decision Rules
Configurable decision rules are powerful tools for helping lenders implement steps and verifications. They also help ensure compliance with varying state regulations such as usury and fee limits. Decision rules can easily be configured to test for these limits and alert when limits have been exceeded. Rules also ensure that decisions are consistently executed, not subject to the variability of manual processes. Decision rules enforce disclosure rules and eliminate any manual steps that could potentially result in disparate impact.
Data-Driven Decisions
The volume and quality of consumer, financial, and industry data available today allows lenders to make better quality decisions, but only if these data are incorporated into the underwriting process. Data sources and services such as identity verification, alternative credit data, vehicle evaluation, and document services help lenders steer clear of risks which can jeopardize compliance. These sources and services empower lenders to:


  • Avoid the increasing risk of identity fraud;

  • Generate a detailed, accurate, and current applicant scorecard;

  • Structure loan terms to reduce risk to both borrower and lenders; and

  • Provide an auditable record of communications between borrower and lender.


Demonstrate Underwriting Compliance

Configuration, workflows, decision rules, and integration with relevant data sources and services are technology tools that allow you to achieve and maintain underwriting compliance. Configuration ensures only qualified, authorized persons can implement changes
It maintains a history of all changes made, by whom and when.

  • Workflows ensure proper steps are consistently taken in accordance with regulations

  • Decision rules remove the variability of manual steps and provide consistency in executing decisions across all applicants

  • Automated capture of all documentation and communications between applicant and lender provides secure digital records by replacing manual underwriting steps with consistently-executed workflows and decisions, you track and record processes, steps, data, decisions, and communications, all at the same time. These records provide irrefutable evidence of your efforts to comply with underwriting regulations.

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