Forensic Loan Audit Pro™

Our experienced and eclectic team of mortgage, legal and accounting professionals use state-of-the-art auditing and compliance technologies that will leverage your company or firms ability to meet respective timelines and benchmarks while delivering superlative best in class quality control standards.

National Loan Auditors

With 125 quality control checks, Forensic Loan Audit Pro™ reveals the TRUE FACTS buried deep within each file, making the most complex transactions transparent and EMPOWERING our clients to make the appropriate decisions based on a thorough understanding of the circumstances and with confidence in the accuracy of our audits and the integrity of their findings.

National Loan Auditors uses the leading forensic auditing and compliance software solutions to uncover violations and identify potential vulnerabilities in loan files. The audits will identify:

• Predatory loan violations and predatory loan practices.

National Loan Auditors' comprehensive forensic loan audit report is organized in three distinct informative sections:

Section I: Forensic loan audit with a compliance analysis report.
Section II: Post closing underwriting and analysis.
Section III: Summary of applicable statutes and controlling case law.

National Loan Auditors provides the most informative, accurate and reliable forensic audit reports available in the industry today. This is why we are fast becoming the largest provider of Forensic Loan Audits to the legal profession in the US.

US Court Audit™

Property Value

The property value analysis uses a state-of-the-art valuation model - NLA-Collateral Expert - to determine value. This analysis calculates a collateral score based on the three layers of potential risk on a given property.

Price, neighborhood and property “history” are the three layers of potential risk on a given property.  The layers build on the previous layers to give an accurate indication of collateral risk associated with a specific property.

• The Pricing layer is derived from an AVM and the sale prices of recent comparable sales in the area.
• The Neighborhood layer considers market liquidity, homogeneity, and REO rates.
• The Property History layer looks at the past sales history of the property.

Each layer builds on and informs the others, to create a holistic assessment of the collateral risk associated with a specific property.

How the score is calculated:

Price Layer

Step one: Calculates the variance between the estimated value and the AVM value.
Step two: Calculates the percentage of the comparable sale prices that are under 90% of the estimated price.
Step three: Calculates where the estimated price falls between the Highest comp sale and the lowest.
Step four: Takes the report of the “Avg. Price of the 5 Nearest Sales” and calculates the variance between the estimated value and the average.
Step five: Starts with the percentage from step two to produce the Price Score.
Step six: If step 3 calculates the estimated price is 95% of the way to the highest price from the lowest price or less than 5% of the way to the highest from the lowest, change the “Price Score” to a 90%.
Step seven: Adds the average of the variances from step one and four to the “Price Score” instep six. This is the Price Layer Value.

Neighborhood Layer

Step one: Takes the ratio of foreclosures to sales from the report.
Step two: Takes the number of comparable sales and the maximum distance from the report, then divides the number of comparables by the maximum distance.
Step three: Calculates the percentage of the comparables that have square footage within 20% of the subject property.
Step four: Calculates the percentage of the comparables in which the sum of the bedrooms and bathrooms varies by no more than 1 from the sum of the bedrooms and bathrooms for the subject property.
Step five: Multiplies the value from step two by the average of the percentages calculated in steps three and four.
Step six: Multiplies the “Price Layer Value” by the sum of 1 plus the percentage calculated in step one.
Step seven: If step five is less than five, multiplies step six by 1.1 to produce the Neighborhood Layer Value.

History Layer

Step one: Determines if the property been an REO within the last three years.
Step two: If the property has been sold in the last 18 months, calculates the appreciation.
Step three: Determines if the title is held by an “LLC” and if the property has appreciated by 25 percent since the last sale.
Step four: Takes the sum of 1 plus the appreciation noted in step two. If the property has been an REO in the last three years (noted in step one), increases appreciation calculation by 10%, then multiplies this by the “Neighborhood Layer Value”.
Step five: If the answers in step three are yes (owned by an “LLC” and 25 percent appreciation), increases the appreciation calculation in step three by 90 percent.
Step six: Drops the percentage sign to produce the final Collateral Expert Score.

The Collateral Expert Score is correlated to the probability that there is a material misrepresentation of the collateral value. Based on a data set of 4,000 loans, bad loans have a score of 90 or higher; moderate risk loans score between 80 and 90.

Customer Identification: Direct Check

NLA’s effective use of Direct Check exceeds the customer identification requirements established by law and regulation for banks, savings and loan associations and credit unions. Industry reports indicate that 65% of all mortgage fraud is either income or identity related. Our approach to fraud prevention is simple: Authenticate the information early in the process. Rapid Reporting has the ability to prevent a majority of borrower misrepresentation at the point of sale or in a quality control environment.

As of December 31, 2006, Rapid Reporting's DirectChek had confirmed the use of false identity in more than 62,000 cases in the past 5 years, preventing fraud losses totaling between $1.8 billion and $3 billion.

Customer Identification: Social Security Verification

NLA’s - DirectChek (Social Security Number Verification) capitalizes on improvements in this program that make match-no-match responses available in real time.

• Direct Match/No Match with the SSA (Requires SSA Authorization Form)
• OFAC (No form required) - result is instant
• SSA DeathMaster (No form required) - result is instant
• Credit Header Information (No form required) - result is instant
• Tri-Merge - Experian, Equifax and Transunion
• 150 other proprietary databases
• Aka/Fka information
• Other SSNs borrower has used and number of times the SSN has been used
• Driver's License Information (if available)
• Previous Address information
• Phone Number (if available)
• Dates Reported of when they lived at or received mail at those addresses
• Other individuals using that borrowers SSN and the number of times they used it
• Social Security Number Sequence Validation along with Date and State of issuance of the number
• Return On Investment Reporting
• Confirmation Emails on Order Receipt and Order Delivery
• Administrative Rights
  
  

Customer Identification: Social Security Verification

NLA - IncomeChek (4506T Verification) - examples attached of 1040 and W2

• IRS quotes 24 to 48 hour turn time on 1040, Corporate Returns (1120, 1120s, 1065), W2, 1099, K1, and Stated Doc and Stated Income; however, AVERAGE TURN TIMES ARE LESS THAN 24 HOURS!!!! 
• Taxpayer Transcript Summary Report
• Secure Web Environment
• Usable Data in XML format
• Confirmation Emails on Order Receipt and Order Delivery
• Administrative Rights

Verbal Verification of Employment is now available.

SafeGuard Audit™

• Forensic Loan Audit Pro™
• US Court Audit™