Written by vendor management professionals
Due to recent changes with the Consumer Financial Protection Bureau (CFPB), mortgage servicers need to do a better job of identifying and managing their vendors. At a minimum, you'll need to have a centralized application that houses all your vendor information.
In 2014, we teamed up with one of our service partners to explain the key requirements in the new CFPB manual and how they apply to Vendor Management, as well as provide tips, guidance and best practices.
One of the goals of the risk assessment is to identify vendors who have consumer contact and how they could impact the customer. You can then better focus your vendor management efforts on the high-risk vendors.
You should acquire important documents from each vendor — e.g., certificates of insurance, licenses and contracts. If the documents have expiration dates, you'll need to be alerted so that you can follow-up with the vendor and always have up-to-date vendor documentation.
Because VendorRisk is offered on a module-by-module basis, you can choose just the features you need. Based on our experience with mortgage companies, we recommend the following:
The first three modules above will let your company track all your vendors, collect the necessary documentation on each, and assess each vendor's risk level so you can focus on the critical vendors going forward.
The optional modules above are for the companies that have the resources to dedicate to vendor management and give you the ability to better monitor vendor performance on an on-going basis.
While we believe that VendorRisk is a straightforward, easy-to-use tool, if you have 1000 vendors to collect information on, that's still a lot of mouse clicks and manual work. With our bulk actions feature, you'll be able to significantly save time by doing an action once (creating a review, sending to vendor, etc.) rather than once per vendor.
Diligence reviews are used in VendorRisk to capture information & documents from the vendor. We provide the ability to email the questionnaire to the vendor and have them complete the information via a "guest page" on your VendorRisk site. This process eliminates the back & forth of email messages and having to upload their documents.
Mortgage companies tend to have specific categories of vendors — e.g. brokers, appraisers, title companies & law firms. Each vendor in a particular category will likely have the same risk level assigned to them. Rather than having to conduct a risk review for each vendor, you can conduct group reviews based on category, and all vendors in that category will automatically have that assessed risk level.
With so many vendors, you may have difficulty tracking and remembering important dates for each vendor. VendorRisk sends automated email reminders each morning that will notify you ahead of time about tasks you'll need to address.