Mortgage Internal Audit: Next Steps After COVID-19
Articles by: Richey May, Jul 22, 2020
Coronavirus has caused a lot of mortgage companies to rethink their typical business practices. The need to maintain flexibility and availability of staff with critical expertise, as well as control costs due to fluctuating demands and new pressures like increased forbearance, has taken center stage as leaders plan their ongoing strategy.
Many compliance requirements have loosened to accommodate for the pandemic, but the compliance outlook for the industry is uncertain. However, in mortgage internal audit looks like it is here to stay as a requirement for the GSEs and other regulators.
Most mortgage companies don’t have the internal resources to staff an internal audit function.
For this reason, many companies choose to outsource. Even large mortgage companies typically do not want to tie up qualified resources on internal audit, especially since experience staff can be hard to find. Internal audit providers can help mortgage companies mitigate the operational and regulatory risks inherent in the post-crisis mortgage origination and servicing environment.
It all starts with a risk assessment.
An effective internal audit starts with a detailed, company-wide risk assessment. From the risk assessment flows a multi-year risk-focused internal audit plan. Your auditor should utilize a forward thinking approach to help guide company leadership through the issues that are present and what risks are most important to mitigate, as well as “quick-wins” that may be able to be remediated quickly by your teams. Use an auditor with industry experience to get the best value; your auditor should be familiar with what the agencies are looking at most closely and what compliance issues represent a bigger risk to your business.
Mortgage Internal Audit is more than just a “necessary evil.”
Business leaders can directly benefit from the identification of process and procedural gaps. A third- party with some distance from the process may be able to identify issues that went undetected. Further, our team has seen the ways other mortgage companies tackle many issues, so we are likely to be able to assist in finding a solution.
Contact us today to learn more about how outsourcing Internal Audit can help you plan for the future of your company. We can help you understand regulatory requirements as well as risk reduction strategies we have used with our many clients.