Reggora says he will pay for mortgage repurchase, LLPA losses associated with appraisal defects

Test management software company Reggora adds a repurchase price adjustment and loan level guarantee (LLPA) to its appraisal review solution.

The valuation tech company said it will include any financial loss related to the repurchase or adjustment of the LLPA due to the appraisal error. Reggora is believed to be the first company to do so based on the results of its appraisal technology, the Reggora Appraisal Review.

In a statement on Wednesday, Reggora – a HousingWire Tech 100 winner – said about 70% of mortgage lender ratings should get a warranty. This will enable lenders to complete underwriting reviews on most appraisals without additional risk.

“As the mortgage industry prepares for an increase in volume, we wanted to help lenders manage that volume more efficiently,” said Reggora CEO Brian Zitin. “Eliminating the need to manually write a large number of appraisals surpasses the advancement of technology and really allows lenders to close loans faster at lower costs.”

Applications for loans from government-sponsored enterprises Fannie Mae again Freddie Mac it has been a long and expensive proposition for lenders.

Freddie Mac’s mortgage broker repurchases rose to $430 million in the second quarter of 2024, a 29.1% increase from the first quarter, according to a public filing analysis. Inside Mortgage Finance. In contrast, mortgage brokers through Fannie Mae repurchased $268.5 million of nonperforming loans during the same period, a 27.7% decrease from Q1 2024. Overall, purchases decreased 0.8%.

Mortgage executives told HousingWire that income verification was the biggest reason for purchase initiation, followed by rating issues. Financial LLPAs are another sore point in the industry.

Last week, the mortgage tech company Candor issued an expansion of its Loan Engineering Program to include Federal Housing Administration (FHA) loan. The company now fully handles the underwriting decisions for FHA loans – minus the collateral – and offers a guarantee on the income calculation and written off terms of the FHA subsidized loans.

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