Earlier this year, we wrote about the new Uniform Closing Dataset (UCD) delivery requirement coming from Fannie Mae and Freddie Mac, which changes the way lenders provide loan information to the nation’s largest investors. The requirement is set to go into effect this Monday, September 25.
The UCD is a component of the government sponsored agencies’ (GSEs’) Uniform Mortgage Data Program® (UMDP®) which is an ongoing effort by Fannie Mae and Freddie Mac to provide a common industry dataset to support the Consumer Financial Protection Bureau’s (CFPB) integrated disclosure laws. In fact, lenders will now be able to transmit the CFPB Closing Disclosure documents and data electronically. This way, regulators and the GSEs see “what the borrower sees.” This also creates an accurate loan file that is consistent for all lenders who sell loans to the GSEs.
The UCD mandate serves as a springboard to greater acceptance of eMortgage and eDocuments. At Docutech, we have certainly seen increasing levels of interest in making the transition to digital lending as the industry has been approaching this deadline. The GSE’s UCD requirement has the effect of taking another speed bump out of the path to a completely paperless lending infrastructure. That serves everyone in the value chain.
Being Prepared for Change
Fortunately for lenders, being prepared for UCD has not been as complicated as the work required in the run-up to the TRID deadline. Most lenders have now taken the key steps required.
MISMO standards, a vital component for UCD compliance, are now industry standard and virtually all of our clients are using these industry-developed data standards in their normal workflows. This makes UCD compliance easier and will also help when the new HMDA reporting rules go into effect.
Some lenders have also done the work required to embed the UCD file into their GSE loans. This involved some additional workflow and IT development work, which drove many lenders to hand this off to their document and LOS providers to handle. We have had that work completed for some time, as have our LOS development partners.
Key Requirements of the UCD:
- The UCD XML file must be submitted for all loans delivered to the GSEs with a Note Date on or after September 25, 2017. The GSEs will use the Note Date reported in the loan delivery XML file to determine whether a corresponding UCD file is required. The UCD file must be submitted to the GSEs at or before delivery of the loan.
- Delivery of the UCD must be in the MISMO Version 3.3.0 Reference Model format.
- A PDF of the most accurate CD must be embedded in the UCD file. The PDF must match the data in the UCD XML file.
- A Casefile ID must be included in the UCD XML file if one is available.
- The UCD XML file and embedded Closing Disclosure must represent the agreed-upon terms of the loan and contain the most accurate information available at the time of loan delivery. In 2018, seller data will be required to be included as well. Both Fannie Mae and Freddie Mac are recommending that lenders begin to submit files with both Borrower and Seller data.
Certified by the GSEs
Certified by both Fannie Mae and Freddie Mac, Docutech’s ConformX dynamic document generation
engine can generate the UCD XML file from the same data at the same time that the CD is created. In fact, Docutech clients can begin testing UCD delivery immediately. ConformX imports data directly from loan origination systems (LOSs), therefore you can be confident that the data will match the document, a requirement of the GSEs.