Security & Fraud

Tapping And Securing Data To Accelerate Real Estate Lending

In a world of breached consumer data, companies are taking new approaches to authenticating a consumer’s identity online. In the latest Digital Identity Tracker, Quicken Loans EVP Bill Banfield explains how Quicken maps borrower data to the original sources to prove their true identity. That, in addition to a deep dive into how biometrics are being used to authenticate users in the travel market.

Whether purchasing a single-family home, a condo or a fixer-upper, buying real estate is a process that’s often fraught with complexities for both buyers and sellers.

Before a property can be financed and titles legally transferred, buyers and sellers must first have their identities and financial statuses authenticated — a process that can stretch from a few weeks to even a month or longer. While awaiting this validation, they often have little to no assurance from mortgage companies that their data will be kept secure during the process.

As such, some real estate lenders are turning to tools that can automatically collect borrower data and more quickly complete the authentication process, thereby easing buyer and seller anxieties. Among these is Quicken Loans, a digital marketplace for real estate loans and refinancing tools. Bill Banfield, the company's executive vice president of capital markets, recently spoke with PYMNTS about how building fraud vigilance into the company’s mindset helps to identify broader patterns.

Cutting Down on Paperwork by Going to the Data Source

For prospective homebuyers, the first step in obtaining a mortgage is often proving to their mortgage companies that they are who they claim to be. For lending companies, that means reviewing and authenticating borrowers’ financial and personal information, bank statements, W-2s and recent pay stubs, then assessing which mortgage types are best for borrowers.

Many lending companies now complete that process via email, but others stick to old-fashioned paperwork for data security purposes. According to Banfield, though, customers’ data remains equally vulnerable whether transmitted over email or fax.

“Just because it’s paper doesn’t mean it’s more secure,” he said. “Some people would say it’s less secure if you fax it, because you have no idea where it’s going.”

Concerns about securing data are not the only element causing headaches, however. The loan approval process can stall if a piece of consumer data is missing due to oversight or forgetfulness. Because getting approved for a loan involves a series of components, a hiccup in one part can cause delays to the rest.

Banfield noted that a problem with submitted paperwork – such as a missing page from an applicant’s bank statement – or a delay from an appraiser can throw a wrench into the loan approval.

“Every one of those parts could add to delays in the process,” he said.

Lending could be expedited if companies were to rely less on transmitted paperwork and instead mapped an applicant’s data directly from relevant agencies, Banfield explained. These could include tax returns from the Internal Revenue Service (IRS), information from the Federal Housing Authority (FHA) and data from credit bureaus, something Quicken Loans has adopted in its own business model.

“It’s coming from the source with no intervention, no PDFs, no faxes,” he added. “It makes the process smoother and take days out of [it].”

Building a Fraud-Fighting Culture

Accessing data from the source is just the first step in ensuring that the lending process goes quickly and smoothly. Another piece is tracking how the data is used, which involves monitoring any anomalies or red flags that may arise during the application phase.

“It’s not the good guys you need to worry about,” Banfield said. “It’s the guys who want to steal money. You have to vet transactions so bad guys don’t slip through.”

Quicken Loans compares loan application data and cross-references it against other data sources to stay on top of how it is used. A team of experts will investigate if an anomaly arises. Employees must remain vigilant against a growing threat of data fraud, Banfield added. Staying vigilant and mapping borrower data directly from a relevant agency go a long way toward expediting the process — and both are key to keeping applicant data safe.

“It doesn’t matter if it’s paper or directly from a data source,” Banfield said. “It’s the absolute requirement that information has to be safe and secure. It’s how you build trust with your client.”

In the real estate market, the ability to trust a process — and sidestep mountains of paperwork — could be the difference between a successful property sale and a prospective borrower walking away from what might have been their dream home.

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About the Tracker

The Digital Identity Tracker™, produced in collaboration with Jumio, is a forum for framing and addressing key issues and trends, facing the entities charged with efficiently and securely granting permission to individuals to access, purchase, transact or otherwise confirm their identities.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.