Digitization and automation further improve efficiency for what is expected to be a game-changing new delivery option for the secondary market
SAN DIEGO, Calif, Aug. 3, 2018 – Mortgage Capital Trading, Inc.® (MCT), a leading mortgage hedge advisory and secondary marketing software firm, announced automation of the Tri-Party Agreement required between lenders, investors, and broker-dealers during Assignment Of Trade (AOT) transactions in the secondary market. The functionality is built into MCT’s Bid Auction Manager® (BAM) bid tape management and best execution platform.
A first of its kind technology, the solution adds significant value to lenders and investors and establishes newfound efficiencies for bid tape AOT executions. Company officials at MCT say that the bid-tape AOT execution is poised to gain rapid adoption and will likely account for a substantial portion of lenders’ agency commitments to correspondent investors. MCT collaborated with Wells Fargo to streamline the process of executing the Tri-Party Agreement, which leverages secure eSignature technology that is legally binding and enforceable.
After beta testing bid tape AOT with select sellers starting in early 2018, MCT rolled out support across their award-winning software, MCTlive!, in May. Bid tape AOT allows lenders to achieve bid tape pricing with the cash benefits of assigning the trade and has been welcomed with excitement from MCT lender clients. One of the final hurdles in the AOT process was the requirement of lender, investor, and broker-dealer to each sign and return an agreement pertaining to every assignment. This process has now been completely digitized and streamlined.
“Historically, the manual execution of the Tri-Party Agreement has made the process of AOT extremely inefficient, as the form generally had to be printed out, wet-signed, scanned, stored, and in some cases was required to be sent via fax machine,” stated Phil Rasori, COO at MCT. “BAM fully automates the old Tri-Party Agreement process by easily and quickly allowing parties to generate, eSign, and securely deliver them to investors, all with the simple click of a button. Automation and digitization of this process using BAM is going to become a game-changer for the entire secondary market.”
Although the availability of bid tape AOT executions is currently limited, MCT expects the popularity of this delivery option to steadily increase. As more investors roll out bid tape AOT programs, the automated tri-party functionality will be integrated accordingly.
This automation is the latest development in a steady series of BAM features which help lenders improve their loan sale process and margins through best execution. BAM was officially unveiled in early 2017, achieved 100% adoption within the investor community a few months later, and earlier this year received PROGRESS in Lending Association’s Innovation Award for mortgage technology.
Lenders using BAM consistently report time savings of over two hours for every loan sale using BAM compared to their previous process, and experience surprising pickup in some cases due to bidding with an expanded investor set. Lenders interested in BAM or automating their AOT Tri-Party Agreement should reach out to schedule a consultation.
Founded in 2001, Mortgage Capital Trading, Inc. (MCT) has grown from a boutique mortgage pipeline hedging firm into the industry’s leading provider of fully-integrated capital markets services and technology. MCT offers an array of best-in-class services and software covering mortgage pipeline hedging, best execution loan sales, outsourced lock desk solutions, MSR portfolio valuations, business intelligence analytics, mark to market services, and an award-winning comprehensive capital markets software platform called MCTlive! MCT supports independent mortgage bankers, depositories, credit unions, warehouse lenders, and correspondent investors of all sizes. Headquartered in San Diego, California, MCT also has offices in Philadelphia, Santa Rosa, Los Angeles and Dallas. MCT is well known for its team of capital markets experts and senior traders who continue to provide the boutique-style hands-on engagement clients love. For more information, visit https://mct-trading.com/ or call (619) 543-5111.
Chief Marketing Officer
Mortgage Capital Trading