Published on February 18, 2021
Written by The Servion Group
After years of delays, including a year-long delay due to COVID-19, the release of the new Uniform Residential Loan Application (URLA) is about to happen. Starting March 1, 2021, all lenders who intend to sell closed residential mortgage loans to Fannie Mae or Freddie Mac will be required to use the new URLA.
Why is the URLA changing?
The redesigned URLA was spearheaded by Fannie Mae and Freddie Mac (the GSEs). The idea behind the redesign, according to the GSEs, is to have a more consumer-friendly loan application experience while also moving the lending industry closer to digitizing the loan origination process.
Biggest changes on the form
The URLA is much longer than before. It is now 9 pages. The redesigned URLA will replace Freddie Mac Form 65 and Fannie Mae Form 1003 and will require lenders to request more borrower information than ever.
The new data fields include a wide range of information, such as:
- Borrower’s mobile number(s)
- Borrower’s email address(es)
- Military service history
- Current housing expenses
- Additional demographic information
Part of the idea with the new fields is to comply with the Home Mortgage Disclosure Act (HMDA) and eliminating the need for the demographic information addendum.
Another big change is that the new URLA’s layout will make it easier for technology to ingest, supporting the industry’s move toward digitization.
Tips to prepare for the new URLA
The GSEs have identified several tasks you should complete in the lead-up to the March 1 start date:
1. Familiarize yourself with the updated URLA
The redesigned URLA and additional supporting resources are available on the GSE web sites. Visit the Fannie Mae URLA page and the Freddie Mac URLA page to see the interactive URLA components and get familiar with the form.
2. Make sure your technology is ready
If you are a Servion correspondent partner who uses your own LOS, make sure your software partner has completed their update. To check, visit each GSE’s approved software partners page. Here is Fannie Mae’s and here is Freddie Mac’s.
3. Prepare your people
Who in your organization works with the URLA regularly? Review updated URLA instructions with those staff to be sure they understand the intention of each form field. Update any internal trainings so they will be ready to hit the ground running when it’s time to make the transition.
4. Think about borrower experience
We know borrowers don’t like being asked for information more than once.The new URLA has more than twice as many fields to complete, which means the risk of a lender missing something increases.You should take some time to plan out how you might respond to possible borrower concerns about how much information is being collected and how to respond if you miss something and need to ask the borrower again.
Contact Us With Any Questions!
If you have any questions about the new URLA or what Servion is doing to get ready for it, don’t be afraid to ask. Call your ServionAccount Executive any time.
Additional Resources
