When loans pass to other servicers and when borrowers pay off loans, the servicer of record is required to finalize the tax escrow information for the county and then release all collateral documents within 10-20 days. However, lien release is error prone and often takes longer than 20 days. At best, there is longer adequate turnaround time to pay off loans, which saps productivity. At worst, you risk late filing penalties, CFPB fines and tax levies for filing lien releases on CEMA loans.
Documents needed for lien release include:
- Recorded Note
- Unrecorded Note
- Recorded Mortgage (includes Deed of Trust)
- Unrecorded Mortgage (includes Deed of Trust)
- Recorded Assignment
- Unrecorded Assignment
- Recorded Satisfaction
- Title Policy
Prior to releasing these documents, servicers are required to ensure that all the information is correct (borrower name, social security number, address, etc.) and then calculate escrow owed, paid and what is due to either the borrower or the county. Non-compliance subjects servicers to potential fines and poor customer satisfaction.
With a combination of business process outsourcing (BPO) services, workflow automation software and cloud document management, MetaSource Mortgage streamlines the lien release process so help ensure compliance and maximize productivity for servicers.
How Lien Release Works
MetaSource Mortgage has built a workflow to ingest lien release documents into LoanStor cloud document management software. When any relevant document is received, via mail, fax or SFTP, the workflow automatically submits the lien release for sign-off. Our mailroom service picks up paper mail then preps, scans and indexes these documents for ingestion into the workflow.
Document images are then presented to any third party that calculates escrow who will report back if any document or information is missing, then send a reconciliation report piece back when the process is done. The final step in workflow is cutting the check to pay off the principal and to either the county or borrower to pay off escrow.
Daily reporting is possible to update your system and can be also distributed to your staff. Billing can also have separate line items for invoicing.