Frank Eve, managing director, Frank Eve Consulting
The idea of competitive advantage through cooperation is a new one to mortgage lenders as they have always tended to keep their technology to themselves for fear they might give too much away. But the environment is changing. Back in February this year Origo secured funding from 14 lenders to start the process of developing data standards in the mortgage industry. Since that time the list of lenders supporting the Origo initiative has grown, the most notable late arrivals being HBOS, the Royal Bank of Scotland and Northern Rock. Origo has held a number of joint forum meetings and also met most of the major industry IT suppliers to obtain their feedback on the standards initiative. This has been valuable. Origo is also talking to the trading platforms regarding their input. But it is not in anyone’s interests for Origo to align itself with any single firm as the success of any standards organisation depends on engendering trust and collaboration among all participants. Origo has to ensure that the process of developing industry standards is open and transparent. When activity moves into the technical development phase, the design and structure of the standards will be open for discussion among all parties involved – lenders, intermediaries, IT companies and trading platforms. By involving themselves in the process, organisations can bring their expertise to bear. This ensures understanding and allows a best of breed process to operate which will be in everyone’s interests. It also allows an open discussion regarding where the market is and what effect standards will have on the mortgage process. The joint forum has already approved a development project with the primary aim of documenting the standard core data sets for agreements in principle and Key Facts Illustrations. The AIP/KFI Development Group will also agree standard application in principle decline reasons and examine pre-offer KFI input variations across lenders. Origo has established a development working group to review and comment on the deliverables. This group consists of both full and reviewing members. These are AIP and KFI experts and business analysts that understand the requirements of data exchange for these documents. Out of this work will come a business requirements document that can be approved by the joint forum at its next meeting at the end of this month. It’s good to see the forum making progress towards a common standard for KFIs and AIP data. These are issues that need addressing. But it must be remembered that the work of the forum can only proceed at the pace set by its members. The standards need to be available at the same time as lender, intermediaries and IT companies can use them. At last, lenders are finding ways of gaining competitive advantage through cooperation and from the broker’s perspective anything that makes the business process speedier and more accurate is good news.