Critical defect rate to reach report high in Q3 2022, according to ACES Quality Control Mortgage QC Industry Trends Report

DENVER, Colo., March 23, 2023 (SEND2PRESS NEWSWIRE) — ACES Quality Management® (ACES), a leading provider of enterprise quality management and control software for the financial services industry, is pleased to announce its quarterly ACES Mortgage QC Industry Trends Report. announced the release of It is targeted for the third quarter of 2022 (Q3). The latest report analyzes post-closing quality control data from ACES Quality Management & Control® software.

Notable findings from the Q3 2022 report include:

*Overall Critical Defect Rate increased 20.5% compared to Q2 2022 and ended the quarter at 2.47%. This is the highest reported value.

* Of the four main underwriting categories (Assets, Credit, Income/Employment and Liabilities), three showed moderate to significant growth in Q2 2022. Income/employment continued to be the leading category of reported defects, despite several quarters of continued decline.

* Subcategory analysis of wealth and income/employment categories revealed troubling deficiencies trends related to eligibility.

* Rating deficiencies have decreased again and now reflect multi-quarter trends.

*Q3 2022 was dominated by buy share, as expected by market conditions, but increased review share for FHA, USDA, and VA loans.

* Contrary to last quarter’s findings, Q3 2022 saw a modest increase in FHA defect share and a slight increase in traditional loan defects. USDA and VA loan deficiencies improved significantly last quarter.

“The overall theme of this quarter’s report is the impact of sharply lower lending volume and interest rate volatility on lender operations. As a result, lenders are struggling to preserve any potential business and are likely becoming more aggressive about borrower eligibility,” said ACES Vice President Nick Volpe. I’m here. “Riding the line of eligibility leaves little room for error. Lenders should therefore continue to focus on loan quality to ensure sellability and long-term asset performance.”

Findings for the ACES Mortgage QC Industry Trends Report for Q3 2022 are based on post-closing quality control data from the ACES Quality Management and Control® Benchmark System and, where applicable, prior quarter and/or calendar year incorporates data from All reviews and defect data evaluated for the report were based on loan audits selected by lenders for full file review.

“In our previous report, we mentioned employment and loan documents as concerns. This is reflected in other areas of the loan manufacturing process, particularly eligibility: “ACES allows lenders to not only identify immediate areas of concern, but also to view QC findings within historical context to identify trends. can also be identified and take immediate corrective action to protect the integrity of the origination pipeline.”

The Mortgage QC Industry Trends Report is available for free download at the following URL: https://www.acesquality.com/resources/reports.

About ACES Quality Control:

ACES Quality Management is a leading provider of enterprise quality management and control software for the financial services industry. America’s most prominent lenders, servicers and financial institutions rely on ACES Quality Management & Control® software to improve audit throughput and quality while controlling costs.

* 60% of the top 50 independent mortgage lenders.

* 8 of the top 10 loan servicers.

* 11 of the top 30 rows.and

* Two of the top three US credit unions.

Unlike other quality management platforms, only ACES offers flexible audit technology. This allows independent mortgage lenders and financial institutions to easily manage and customize ACES to meet their business needs without relying on IT or other external resources. Using a customer-centric approach, ACES clients get responsive support and access to experts to maximize their investment. For more information, visit www.acesquality.com or call 1-800-858-1598.

News Source: ACES Quality Control

Related Links: https://www.acesquality.com/

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