BNY and Snapdocs today launches an initiative to deliver an infrastructure to manage digital mortgage collateral through their full life cycles, even as they enter the secondary market.
On an end-to-end basis, the joint initiative delivers collateral without relying heavily on manual transfers as loans are settled, then transferred between lenders, warehouse banks and custodians, according to a joint statement.
The industry development relies on BNY's popular custody processes, and its investment in next-generation infrastructure with the Snapdocs' platform, including its eVault technology, document classification system and data extraction, according to Snapdocs.
Four main capabilities support the initiative, composed of:
eVault and eCustody frameworks that can manage both digitally-native and imagined documents in a way that can be fully audited
touchless collateral delivery, which allows collateral to be delivered automatically from lenders to BNY directly at the point of closing, reducing risks of fragmented and manual handoffs
document intelligence, which classifies all the documents in the system and extracts data to automate quality control and certification, gather analytical insights on the portfolio and support real-time risk surveillance
scalability to extend beyond mortgage assets, which will position BNY to broaden this document custody approach to other asset classes
Typical manual handling could slow secondary market execution and erode per-loan profitability, Snapdocs said. But under the new initiative warehouse banks and investors can meet growing lender demand for digital collateral acceptance, according to the company.
