Washington Report: Freddie Mac Automated Underwriting Expands
January 1, 1996
Freddie Mac's automated mortgage underwriting service, called Loan Prospector, is expected to expand its availability from 130 counties to 350 counties in 1996. The service--which automates key mortgage origination processes, including credit evaluations--is now being used by lenders in metropolitan areas including Phoenix, Denver, Chicago, Philadelphia, and Los Angeles.
Freddie Mac in mid-December announced an enhancement to Loan Prospector intended to cut the time it takes to assess a property and further speed the residential mortgage loan approval process. The enhancement to its "collateral assessment" feature involves the use of property databases and statistical models to determine the value of a property.
The actual collateral assessment of a property is performed by Freddie Mac with the help of real estate practitioners and appraisers, whom Freddie Mac said it will enlist to perform exterior inspections of properties and provide information on comparable properties. Freddie Mac says it can turn around a collateral assessment within 72 hours and, using all features of the automated Loan Prospector service, has reduced the amount of time it takes lenders to originate and close a loan to five to 10 days. Expedited collateral assessments differ from appraisals in that they cost less, require less time to perform, and do not include a price opinion on a property, according to Freddie Mac. The expedited collateral assessments are expected to be used primarily on properties that fall below $250,000 in value.
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Updated: July 01, 2022