Yesterday at the annual MISMO Winter Summit, Freddie Mac and Fannie Mae (the GSEs) gave the audience a joint update on the implementation of the Uniform Closing Dataset – or UCD as it's known in the industry. The UCD directly supports the Consumer Financial Protection Bureau's new Closing Disclosure, part of the Know Before You Owe mortgage rule that took effect on October 3, 2015.
The UCD mandates the data collection supporting the new Closing Disclosure and is based on the MISMO technology standard, the same standard that is being used in the Uniform Mortgage Data Program (UMDP) – the joint initiative between Freddie Mac and Fannie Mae to improve data quality and consistency throughout the mortgage process. This project began in 2010 at the direction of the FHFA, and it has hit several important milestones since it began.
The UCD will be another milestone, helping the GSEs further advance toward assembling a complete loan file for evaluating risk. While Freddie Mac and Fannie Mae will have independent data collection solutions for the UCD, the GSEs are aligned on data requirements, conditionality and file format. The UCD will be used to verify that the loan, as closed, meets each GSE's eligibility guidelines and matches how it was underwritten. This will provide several benefits across the industry:
- Provides a consistent approach and language to convey closing information
- Promotes better and more efficient data integration and change among partners
- Improves understanding and clarity about the loan transaction
- Helps to verify that loan eligibility requirements have been met
- Provides better purchaser/seller certainty regarding transaction details
- Enhances fraud detection capabilities
- Enhances market analysis capabilities
- Facilitates compliance activities
Learn more about the UCD and the UMDP.
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