MetaSource Mortgage Blog

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Friday, April 05, 2019

Conference of State Bank Supervisors (CSBS) and American Association of Residential Mortgage Regulators (AARMR)

Conference of State Bank Supervisors (CSBS) is currently sponsoring an initiative to standardize Lending Examination Formats (LEF) for depository and non-depository institutions for both state and federal supervised entities.

What is Lending Examination Format (LEF)?

Lending Examination Format (LEF) is the industry data standard for the e-exam process. It was developed by ComplianceEase and adopted by the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators (AARMR). Compliance Ease currently offers the data collection and formatting via their RegulatorConnect and RegulatorDirect offerings.

Who are Conference of State Bank Supervisors (CSBS) and American Association of Residential Mortgage Regulators (AARMR)?

Conference of State Bank Supervisors (CSBS) is the professional association of state officials responsible for chartering, supervising, and regulating the nation’s over 5,600 state-chartered commercial and savings banks.

American Association of Residential Mortgage Regulators (AAMR) consists of state regulating agencies and mortgage industry participants who promote the exchange of information and education concerning the licensing, supervision and regulation of the residential mortgage industry, to ensure the ability of state mortgage regulators to provide effective mortgage supervision for a safe and sound industry meeting the needs of the local financial markets and to protect the rights of consumers.

What is the Goal?

The goal is to streamline the data so it will satisfy the requirements of multi state examinations as identified in the (MMC) Multi-State Mortgage Examination Manual published by the Multi-State Mortgage Committee and also be shared with the federal government. Multiple states can perform an examination of a lending institution at the same time. They share data and findings between the states, this is a way to save money on state examinations. If a state has previously noted a situation they can share the results or any other data with the other states. These examinations can be very costly for the lender because they have to pay a fee each day the state is onsite and/or performing the examination.

States and other regulating entities have specific time lines and data required to perform an examination. The LEF is a way to standardize the information lenders need to gather in real time during the manufacturing of a loan file. It is the goal of most lenders to assist regulators with a speedy and accurate review of their lending business. Otherwise, the examination may take a great deal longer and cost the lenders even more because of the lack of clarity in the data.

How Can MetaSource Help?

MetaSource can help lessen the pain to our clients who are responsible for submitting data to examiners by assisting them with data format. We know where the hardships are among the mortgage professionals balancing the changing expectations of consumers and growing competitive pressures within the demands of a regulated industry.

Not conforming to new suggested mandated standards can mean larger than necessary expenses for examinations, which can impact one single state to multiple states and/or agencies as well as other participants such as mortgage insurance companies.

There are no current mandates in place, yet, but we believed some may be implemented within the next 18 to 24 months. Let MetaSource get you up to speed now before it becomes mandatory!

Contact us to learn more about data extraction and standardization

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