Sharing Knowledge in New England

Article By: Gregg Oberg, Spillane Consulting Associates, Inc.

One of the great things about SCA is the range of issues we get to see, and the wealth of knowledge we get to tap into while working with dozens of clients on a monthly basis.

Today, we’ll share some Systems knowledge courtesy of our own Paul Bates and Lance McGrath.

What’s New, and What’s Next?

We’ve been putting our ears to the ground this summer, out and about New England (and beyond) helping clients understand and solve the systems, compliance, best practice, and quality control issues that keep them up at night. One of the great things about SCA is the range of issues we get to see, and the wealth of knowledge we get to tap into while working with dozens of clients on a monthly basis.

This may be informal calls, working together on long term projects, our compliance hotline, or various formal and informal groups we participate in.

Systems User Groups

My colleagues Paul Bates and Lance McGrath attend a periodic Encompass User Group that a few like minded industry types put together. I was fortunate enough to sit in on the meeting this AM, where Paul and Lance discussed “Business Rules” on Encompass.

From Paul:

Changing Workflows in Encompass

Encompass is a powerful Loan Origination System Platform, and one of the key advantages the system has is the use of Milestone Completion Business Rules. The challenge arises when your workflow changes and you need to modify rules, or even change the milestones involve in a workflow.

Milestone rules and even Milestone Templates can be changed safely and effectively with your active pipeline if the process is clearly thought out, tested, and deployed. One of the key tips to accomplishing this properly is the use of advanced conditioning of your business rules to take effect with applications started after a specific date. This keeps existing loans in the pipeline from being corrupted or losing data.

Our consultants have been involved with several projects re-engineering workflows for Encompass users. Please feel free to reach out if you would like to have a conversation on this process.

The Fit Between Systems and Compliance

Many of you might say “duh” when you read this, but I’m a lawyer. While I’m conversational in “techie”, the folks using systems like Encompass day in and day out are on a different planet altogether. With that disclaimer, here’s what I learned from Paul and Lance today, and some compliance implications I noted during the call.

What is a business rule?

  • A business rule can be used to force your system to do something. Most often, it can be viewed as a “codification” of workflow and/or compliance decisions that are institution specific.

  • Encompass is set up to meet most needs, but can be customized to meet almost any need. Paul “I’ve yet to run into something that’s a hard ‘NO’ in terms of customization.”

Why would we need a business rule?

Suppose your workflow requires the LO to complete the entire application (including “years in school” which is commonly missed, among other info) before moving to processing.

If your LO continually misses information, the processor must engage in a back and forth with the LO to move the file along. This creates delays in the origination process, and ties up the LO’s time which could be used to bring in more applications.

With a business rule, we can require that all the information our procedure says we want by a certain time is actually there before the file progresses, or reaches the Milestone at which it is handed off.

Best Practices Tips

  • TEST, TEST, TEST (there is no way Paul would sign off on this blog if I didn’t tell you to test).

  • Business Rule Log: create and maintain a procedure for tracking your rules. When were they created, and why? What should they apply to? How was the change evaluated and who signed off? These are all hot topics that compliance should be involved in from a CMS perspective.

Wrap Up

Policy and procedure is a great (and required) way of laying out your business practices, adherence to rules, and expectations of employee conduct/job responsibilities.

However, a policy is only as good as the follow through. Using tools like Encompass with Business Rules can allow you to formalize these procedures into the daily workflow. But this is not without risk. How do you test? When do you implement?

How does the tangled web of rules interact with a new rule? For these questions, and more, Better Call Paul (and lance).

Welcome Nick Lattarulo to the SCA Family!

This week we’re thrilled to introduce Nicholas (Nick) Lattarulo, our newest Regulatory Compliance Consultant. Nick continues an SCA tradition of hiring young, compliance minded attorneys from Boston University School of Law

Nicholas focuses on legal and regulatory compliance for community financial institutions. He will be supporting SCA’s efforts to help the industry adapt to changing HMDA requirements. Specialties include: HMDA training, policy and procedure review, social media compliance, Reg. Z, Dodd-Frank and CFPB, Reg O, fair lending, loan servicing, and AML/BSA. ​

Nicholas grew up just outside of Hartford, Connecticut. He graduated from Suffolk University summa cum laude with a double major in Political Science and American History. After that, he went on to earn a JD from Boston University School of Law. The following year, he completed a legal concentration, earning an LLM in Banking & Financial Law. While at Boston University School of Law, Nicholas served on the Dean’s Student Advisory Board, was a Director of the Student Advising Program, and held leadership positions in several student organizations.

Before joining SCA, Nicholas served as a judicial intern to the Honorable Marianne B. Bowler of the United States District Court for the District of Massachusetts. Nicholas also worked as a legal intern for the Massachusetts Office of Consumer Affairs & Business Regulation. While there, he interacted with several state agencies including the Massachusetts Division of Banks.

And the Rest…


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**These are our opinions. We’re not authorized, or willing, to express those of others.**

Thank you to Gregg Oberg, Spillane Consulting Associates, Inc., who with the support of other experts at SCA have put together this newsletter.