LOAN REVIEW
Compliance
A Complete Suite of Compliance Solutions
Clayton offers compliance solutions that cover all sections of the mortgage continuum from origination to pre-foreclosure analysis.  Our High Cost Focus (HCF) & High Cost Analyzer (HCA) modules are designed to review open files from GFE through funding.  The Clayton Loan Analysis System (CLAS) is designed to review closed files.

High Cost Focus & High Cost Analyzer
High Cost Focus
A cost-effective and highly efficient way to filter all loans for potential high-cost threshold violations.  Loans that are subject to high-cost thresholds are flagged and can be transferred to Analyzer for in-depth analysis.

High Cost Analyzer
Detailed and comprehensive compliance tests, including:
  • Federal & (HOEPA)
  • Over/Under Disclosure by APR + Finance Charge
  • State-Specific Prepayment Penalties
  • State Covered Loans
  • GSE Specific Tests
  • State High-Cost by Fees and APR
  • Right of Rescission Calculations
  • Texas Equity
  • Mortgage Insurance Payment Stream
  • Re-calculation of Payment Streams
Our web-based software is installation free and very user friendly, allowing your team to key in data and begin testing compliance today.  We also offer data integration, working with you to extract data directly from your LOS or other data management system and deliver a result-set to your application in a standard MISMO or customized format.

High Cost Focus & High Cost Analyzer Results

Better salability: Using these solutions, you can perform the same compliance testing the buyers and sellers of your loans will perform in the secondary market, providing you complete confidence in the results.
Increased efficiency: These automated solutions provide efficiencies that allow your compliance personnel to analyze more loans in less time.
Expanded reach: Wholesale originators, correspondents and buyers can be confident that they will comply with unfamiliar high-cost regulations as they expand into new geographic territories.

CLAS
CLAS is primarily targeted to the due diligence of closed loans. Underwriters confirm whether material disclosures are properly provided and, if required by law or for audit purposes, signed and dated.  Testing is performed to ensure that the loan was originated in compliance with the laws that Clayton is testing for.  The focus is on laws that, if violated, subject the assignee to liability, or provide the borrower with actions, defenses and/or counterclaims that it can enforce against the assignee.

Detailed and comprehensive compliance tests, including:
  • Federal & (HOEPA)
  • Over/Under Disclosure by APR + Finance Charge
  • RESPA and FACTA disclosures
  • Identification of HDMA-reportable loans
  • State-Specific Prepayment Penalties
  • State Covered Loans
  • GSE Specific Tests
  • State High-Cost by Fees and APR
  • Right of Rescission Calculations
  • Texas Equity
  • Mortgage Insurance Payment Stream
  • Re-calculation of Payment Streams
  • Borrower's interest testing
  • Non-traditional mortgage and subprime guidance testing
CLAS Exception Tracking
Clayton has developed over 1,200 standardized codes to allow our clients to assess risk at both the loan level and across an entire portfolio.  This exception tracking system combined with commentary from our expert underwriting staff gives our clients a credit risk assessment unparalleled in the industry.  Additionally, when Clayton is engaged for numerous reviews of a similar nature, exception/result trend reporting is available.

CLAS Results
Understanding of the seller and portfolio:  CLAS will identify loans that may need to be removed from the sale, and may uncover patterns and practices of noncompliance that can provide an opportunity to educate your client on better practices.
Effective sampling methodology:  Clayton’s review and reporting will provide you with the information you need to decide the sample size of the loans that you want to review before purchasing the portfolio.  You will be able to identify issues as they develop into trends during the course of the review.
Confidence in Representations and Warranties:  By reviewing a representative sample, as well as by increasing the sample size based on early reports, you will be able to make your compliance-based representations and warranties with greater confidence.
More efficient resales:  If you decide to sell the loans that have gone through CLAS, you will understand which loans should pass diligence by your purchaser, and which loans may be questioned.

Up to Date & Accurate
Clayton ensures that its compliance systems are up to date and accurate via numerous ways:
  • Staff:  On-staff attorneys monitor and interpret legislation and court decisions in regards to residential mortgage lending, servicing and secondary market sales.
  • Outside Counsel:  Clayton partners with outside counsel for legal opinions and advice on mortgage lending laws and the scope of Clayton’s testing.
  • Resources:  Clayton utilizes numerous sites, groups and resources to stay abreast of all relevant legal activity.
  • Audits:  Clayton engages independent law firms with compliance expertise for annual audits of Clayton’s compliance system and scope.