MBA’s RIHA Releases Special Report on Managing Mortgage Product Development Risk
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WASHINGTON D.C. (September 14, 2017)- The Mortgage Bankers Association's Research Institute for Housing America (RIHA) today released a new special report, Managing Mortgage Product Development Risk." The report "recommends a more formalized approach to assessing mortgage product risk that takes into account both product and process risk." It was authored by Clifford V. Rossi, Executive in Resident and Professor at the Robert H. Smith School of Business, University of Maryland. You can download the full paper here.
"Now is a particularly important time to pay attention to risk management in mortgage products," said Lynn Fisher, RIHA Executive Director and MBA's Vice President of Research and Economics. "The single-family mortgage market is undergoing significant change these days. As employment continues to improve and borrower demographics continue to change we will see increasing demand for new or re-imagined mortgage products."
"Mortgage banking is a highly cyclical business, prone to expansion and contraction as market conditions change. Mortgage product innovation is healthy for the industry and consumer so long as product risks and process quality are well understood. This study provides the industry with a framework for addressing both in an integrated manner," Professor Rossi writes. "Leveraging systems engineering and commercial real estate risk rating methodologies, the paper describes scorecards for assessing product risk and process quality. Such tools can be customized and provide a means of evaluating mortgage products and for identifying potential gaps in processes and product prior to product release."
Professor Rossi will discuss this paper and other emerging risk management issues during a panel at MBA's Risk Management, Quality Assurance & Fraud Prevention Forum 2017 in Miami, FL later this month.
MBA's Research Institute for Housing America (RIHA) is a 501(c)(3) trust fund. RIHA's chief purpose is to encourage and assist--through grants to distinguished scholars and subject matter experts, educational institutions, research facilities and government organizations--establishment of a broader based knowledge of mortgage banking and real estate finance. You can find additional studies on RIHA's website: www.housingamerica.org.