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MISMO / eMortgage Update
1. MISMO / eMortgage Update
Harry Gardner
President, SigniaDocs, Inc.
Chair, MISMO Residential Governance Committee
November 9, 2011
2. MISMO Standards
• Logical Data Dictionary (LDD)
– Over 5,000 data points and enumerations (lists of
values), with business definitions agreed-upon by
industry participants
– Workgroups vet data points and definitions they need
for their business exchanges
– Core Data Structures reviews proposed data points
against existing LDD
• Version 3 -- XML Schema
– Reference Model sets the structure and relationships
for all those data points
– Extensible – business partners can add their own
custom data 2
3. MISMO Structure
Board of Directors
Residential Governance
Core Data Structures Architecture WG
Council of Chairs
Process-Area Workgroups: Specialized Workgroups:
Origination, Secondary, Servicing Doc Classification, eMortgage,
Tax, Title, Credit, Flood, MI Business Rules, Interface Arch.
Development Groups
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4. Standards Development
• IPR policy allows competitors to come together and
develop data standards that benefit everyone
• Compete on services and technology, not data
formats
• Reference Model ensures common XML structure
• Conf Calls – Workgroups, Development Groups
• Trimester Meetings – January, May, September
• Standards are constantly being expanded to meet
real-world needs of the industry
4
5. Standards vs. Specifications
• MISMO standards
– Openly created and openly available
– Developed by industry consensus
– Common language
– Extensible
• Regulatory reporting specifications
– Usually more “closed”
– Created by regulators or private industry groups
– Usually not aligned with existing open standards
– Data quality is compromised
– Cost impact
5
6. Industry Adoption
• Early days – mostly front-end services: tax,
title, flood, MI – request/response
transactions
• Extended into Origination, Underwriting,
Secondary delivery and Servicing setup
• Now mandated by FHFA for Fannie & Freddie:
• UMDP: Uniform Mortgage Data Program
– ULDD: Uniform Loan Delivery Dataset
– UAD: Uniform Appraisal Dataset
6
7. SMART Doc V3
• MISMO “Document” concept, common
throughout all workgroups
• Addresses shortcomings of SMART Doc V 1.02
• Flexible structure
• Any VIEW format (PDF, XHTML, Word…) can
be incorporated with XML data
• Working with MBA, MERS, Fannie Mae and
Freddie Mac to coordinate and plan transition
to SMART Doc V3 7
10. Real-World Application of
Electronic Signatures
Jeff Knott
Director, Product Management
Equifax
November 9, 2011
11. Today’s Roadmap
• Market Challenges
• Multiple Use Cases
• eSignature Case Study
– IRS Form 4506-T
– Market Problem
– Proof of Concept
– Program Objectives
– Value Proposition
• Q&A
12. Market Challenges
• Fraud
• Compliance
– Laws and Regulations
– Internal Policy
• Security
– System Access
– User Authentication
• Process Adoption
13. Multiple Use Cases
• Mortgage
Qualification
• Credentialing
• Background Investigation
Risk Customer • Consumer Finance
Mitigation Acquisition
• Accounts Receivable
• Government Programs
• Property Management
Quality
Control
Service
Renewal
• Brokerage Services
• Insurance
Customer Lifecycle
• And more . . .
15. IRS Income Verification Express
Service (IVES) Program
• Personal Tax, Business Tax, and Wage Statements
• Registered IVES program participants; authorized 3rd parties
• Documents retrieved directly from the IRS
• Consent-based service
• IRS form (4506-T, 4506-EZ, or 4506) must be signed within 120 days
Client IVES Participant IRS Service Center
Order
Form 4506-T Form 4506-T
Tax Document Tax Document
Acquisition & Quality Check Tax Transcript
Decisioning Process & Fulfillment Fulfillment Process
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16. IRS Form 4506-T
Taxpayer’s SSN
Previous Address
Enter Form Type
Check box for 1040
Check box for W2, 1099
Enter Years Requested
Date within 120 days
Signature
17. Market Problem
• Traditionally the IRS Return and Income Verification Services
(RAIVS) team does not allow the use of electronic signature
on its Form 4506-T as an alternative to ink signatures.
• Electronic commerce is enjoying rapid adoption across many
sectors, in both business and government transactions.
• Methods for initiating, completing and recording electronic
signatures and records are expanding as demand increases,
with many technologies to choose from in the market.
• Due to current economic conditions, especially in the
mortgage industry, and increased regulations, this type of
electronic processing can be leveraged to solve a widely
recognized efficiency concern.
18. Industry Leadership
Equifax & DocuSign
• Championing industry enhancements
• Defining and aligning policies, standards, and rules
• Identifying data stakeholders and their goals
• Communicating with accountability to stakeholders
• Providing mechanisms for review and issue resolution
Policy
Data Quality
&
Strategy Management
19. Proof of Concept
• Equifax and DocuSign have partnered with the IRS to
initiate a small-scale, limited-scope experiment
involving the submission of electronically signed
forms to the IRS through a trusted third party
• This pilot would enhance the IVES program by
allowing either a “wet” ink or electronic signature to
be used by taxpayers on a Form 4506-T
20. IRS Requirements
• Support the electronic filing goals of the IRS Restructuring and Reform Act
of 1998 (RRA 98) by enabling electronic signature technologies
• Comply with the requirements of Section 508 of the Rehabilitation Act
• Protect citizen rights and privacy, limit burden, and promote broad
acceptance of electronic commerce
• Use technologies and processes that facilitate electronic filing, payment,
and communication without relying on paper-based signatures
• Replace paper transactions with electronic methods that are more
accurate and less expensive to process
• Have security appropriate for the level of risk
• Are based as much as practicable on established laws and existing
frameworks, including time-tested industry practices
21. eSignature Objectives
• Require no changes to IRS policy or procedure
• Require no changes to trusted third party relationships
• Test the effect of electronic signing on the Taxpayer
experience
• Improve Taxpayer privacy over current levels
• Reduce 4506-T rejection rates from current IRS levels
• Improve data integrity and security
• Test the ability of electronic processing to solve a widely
recognized efficiency concern within the IRS
22. Value Proposition
• Electronic signature
acceptance by the IRS on
Form 4506-T:
– Promotes use of tax
transcripts
– Reduces lost paperwork
– Minimizes signature fraud
– Streamlines processes
– Lowers costs
Final released versions are posted for open download from MISMO.ORGSubscribers have access to draft versions as they are developedCan be extended via NameSpaces – but extensions are often incorporated into the next release as part of the full standards, so although MISMO creates standards, they are far from static – constantly expanding and evolving to meet the needs of those who use them.Data quality of regulatory reporting specs – CSBS, ASF examples – comma-delimited format, limited or different enumerations, varying matches to MISMO granularityRegulators can help their constituents save $$ by aligning to existing, adopted standardsMISMO welcomes opportunities to expand the LDD and reference model with additional data needed for regulatory purposesEveryone benefits through cost savings and better data quality (which is the core value of having this data reported in the first place)
