Closing Instructions DWG
Industry-wide use of standards is critical for effective, efficient, and flexible business practices. Standards help mitigate risk, improve consumer understanding and satisfaction, and reduce costs. MISMO, the mortgage industry's standards organization, has succeeded in creating a common terminology that is used for communications between lenders, service providers, regulators and others. MISMO has now been tasked with improving communication in a new area, which is the communication of closing instructions between lenders and closing agents.
In today's mortgage environment, closing instructions provided by lenders to closing agents are not standardized. Each lender creates their own forms to communicate what they need a closing agent to do to close the loan. Inconsistencies in format and content of closing instructions across lenders can increase the risk of misunderstanding between lenders and closing agents. This uncertainty can insert additional risk into the closing process, resulting in errors or loans that are not compliant with lender, regulator, or investor requirements. Errors requiring last minute changes, or post-closing corrections, may result from these inconsistencies. Customer satisfaction with the loan origination process may also be adversely affected. In an effort to meet these industry challenges, MISMO invites all interested parties to participate in the new Closing Instructions Development Workgroup.
Read about our exciting work on the standards of Closing Instructions here!
The mission of the Closing Instructions Development Workgroup is to Create and maintain a standard template for lenders to use to document instructions for closing agents to follow when closing a loan on behalf of a lender.
Current Goals and Objectives
The Closing Instruction Development Workgroup will create a common template for closing instructions. This template will ensure that similar information can be found in the same place from one lender to another. It will also ensure that the most important information is provided at the front of the document. It is important to note that this Workgroup will not attempt to standardize the language used by various lenders in their closing instructions, but rather will focus on creating the common format for use by lenders.
Workgroup deliverables will include:
· A common closing instruction template
· Implementation guides for lenders, closing agents, and vendors
· Instructions for the day to day use of the closing instruction template
· A data exchange standard that permits the electronic exchange of closing instruction information
How Can I Get Involved?
If you would like to participate in this collaborative, industry-wide effort, please send an email to firstname.lastname@example.org titled "Join MISMO's Closing Instruction Workgroup". The Closing Instruction Workgroup will conduct regular meetings via conference call and will meet in person at MISMO Summits, which are held three times a year. This Workgroup is expected to exist for one year as it completes its mandates; however the lifespan of the workgroup may be extended as necessary to meet industry standards.
Kate Steineman, Wells Fargo (Chair)
Jim Lamphere, Home Services of America (Vice-Chair)