A Great Transition: A Lender Simplifies Servicing Data Delivery with FAST®

Northeast Home Loan (Northeast), a wholly-owned subsidiary of Passumpsic Savings Bank, provides home financing options, interest rates and terms to borrowers throughout New England.

As part of their day-to-day operations, Northeast sells the servicing contract rights (sometimes referred to in the industry as mortgage servicing rights, or MSRs) associated with mortgages Northeast originates. Northeast sells their servicing contract rights to several different servicing contract rights buyers, depending on a particular mortgage.

Managing Disparate Requirements

For the team at Northeast, one of their challenges was working with multiple servicing contract rights buyers’ unique requirements for delivering data and documents related to the transfer of servicing.

“Our buyers each had their own procedures and transfer instructions for file and data delivery,” explains Tina Johnson, senior vice president and secondary market officer at Northeast. “It was a daily challenge to administer every buyer’s individual requirements.”

Additionally, buyers had their own file naming conventions. “None were the same,” Tina adds. Most required imaged documents to be uploaded to individual company web sites in a unique stacking order. One buyer still required paper delivery, which meant boxing up and shipping physical documents, a manual process that was labor intensive, costly and time-consuming.

While there were a lot of differences to manage, the Northeast team had gotten used to juggling multiple servicing contract rights buyer’s specific demands and procedures. “Once we understood how they wanted everything and set it up accordingly, it was ok,” Tina adds. “But that didn’t mean it wasn’t cumbersome. Actually, it was a lot of work.”

The Northeast team didn’t know there was a way to make the process easier. “We weren’t really looking to automate,” says Tina, “but when our Freddie Mac representative told us that they were changing their servicing-released processes and rolling out a new platform that could simplify the way we transferred servicing documents, we were very interested.”


Making the Process Easier

The platform that Northeast’s Freddie Mac representative told them about is Freddie Automated Servicing Transfer® (FAST®). FAST standardizes and simplifies the delivery of servicing data, documents and other files.

Lenders like Northeast simply drag and drop their imaged servicing documents to FAST via secured file transfer. Through optical character recognition (OCR) technology, FAST automatically extracts data from imaged documents and sends an XML file to the servicing contract rights buyer to onboard mortgages. FAST creates a PDF file of all servicing documents in the buyer’s prescribed stacking order.

With FAST, Northeast no longer needs to manage the specific data and documentation requirements and processes of multiple servicing contract rights buyers. They’ve also eliminated the time-consuming manual steps (and associated costs) they had to manage for years.


Cutting Costs, Saving Time

Northeast acknowledges how easy it was to implement FAST into their process. “The FAST team at Freddie Mac worked with us diligently to get us up and running,” says Tina. “There was always someone available if we had questions. They were very helpful. We were operational immediately, and we never looked back.

“FAST solved for the need for different requirements for each servicing contract rights buyer,” she adds. “We were thrilled to have a centralized site, which has streamlined our entire process. From a performance perspective, we move much faster. That’s a huge benefit.”

At Northeast Home Loan, FAST has irrevocably changed the way servicing documents are delivered. “FAST took away the time-intensive aspects of our process and made it better,” says Tina.

By reducing time invested, Northeast is also saving money. “The shipping costs alone have been cut significantly,” she adds. “Our shipping bill used to be quite large.”

“Moving to FAST has been a great transition. We love it.”