Move compliance metrics to the front

Implications: a) existing federal, state amd municpal compliance check and balances exist b) move Rating Agency solutions to subprime mortgage losses in the large secondary market traunces into the origination systems & procedures

Analysis:

I have spent a good portion of my 30-year career in Mortgage Lending Technology designing and implementing technology solutions in the mortgage origination phase.

Currently in-place; Federal (HOEPA), State & Municipal (High Cost) prohibitions to STOP FROM FUNDING any out-of-balance and possible predatory loans.

This process has been in-place for over a decade, and the viability is definitely up for debate.

However, the same technology used by the largest global originators of mortgages, to STOP FROM FUNDING these predatory loans could also use a dose of compliance metrics from the rating agencies.

Basically, the current predatory compliance protects the potential borrower of the note - my suggestion is to ALSO protect the mass investor/buyer of the note.

Move the rating agencies metrics to the beginning of the mortgage origination cycle and STOP FROM FUNDING if the metrics so indicate.