By Brian Vieaux, CMB, President of MISMO
A mortgage company can invest in impressive technology and still spend too much time getting information, people and counterparties to work together. A faster system inside one company has limited value when the next participant cannot use its data or when an unresolved process keeps the loan from moving forward. Those are business problems that deserve as much executive attention as the next technology purchase.
Reflecting on my 3+ decades in the mortgage industry, I have a healthy appreciation for competition. I also believe we need to be more deliberate about recognizing the problems we share. There is little competitive advantage in having every company spend time resolving the same uncertainty about a data definition, a governance process or an agreement between trading partners. That effort consumes resources we could put toward serving borrowers and improving our businesses.
With the launch of the new MISMO brand and logo, that distinction is central to the story we want to tell. Our new tagline, “Where Our Industry Builds What’s Next,” reflects the range of work our community is undertaking and the people responsible for it. Standards remain the foundation. The opportunity is to help more industry leaders understand what that foundation makes possible.
For years, “The Language of Lending” has described MISMO’s role in helping the industry communicate through common standards. That remains essential. When information moves between lenders, technology providers and other participants, shared meaning matters. Adding artificial intelligence to a process makes clarity about the information entering that process even more consequential.
The “S” in the new logo represents the standards that remain at the core of our mission. We want the broader identity to help an executive see the connection between that work and the issues occupying the leadership team: introducing technology responsibly, improving operations and addressing friction that extends beyond the company’s walls.
“For years, MISMO has quietly supported the industry, and this team has worked tirelessly to bring that work into clearer view. The new brand honors decades of earned trust while reinforcing MISMO’s role as the place where our industry comes together to improve efficiency, strengthen AI governance and build for the future. I am proud to have served as chairman during this pivotal year and will continue to champion this critical organization.” —Tim Bowler, MISMO Board Chairman and Chief Innovation Officer, Intercontinental Exchange (ICE)
Artificial intelligence offers a useful example. Before a mortgage company expands its use of AI, someone needs to understand where it is being used, what information it relies on and who is accountable for the resulting decisions. A compelling demonstration may establish that a tool can perform a task. Leadership still has to determine whether the company is prepared to use it responsibly.
Those questions reach across a business. Technology teams understand the systems, while operations teams understand how the work actually gets done. Risk and compliance professionals bring another essential perspective. The people choosing a tool and the people overseeing its use need a common process for evaluating it. Otherwise, a company can accumulate individual technology decisions without developing a clear understanding of its overall exposure.
MISMO released FRAME, the Framework for Responsible AI in the Mortgage Ecosystem, this year. V1.0 of FRAME includes a governance policy template, an AI system inventory and a system risk assessment, supported by implementation guidance. It gives mortgage companies a shared starting point for organizing this work. Work is underway on additional artifacts with V2.0 to be released later in Q4. [1]
The value of that starting point is especially relevant for an organization whose people already carry several responsibilities. A common framework allows them to focus more of their effort on decisions specific to their business. They still have to understand their systems, assign responsibility and make the process operational. An inventory that nobody maintains will become outdated regardless of how good the original template was.
This is where I believe our industry’s conversation about innovation needs to mature. We should ask how a company will oversee a tool with the same seriousness we bring to evaluating what it can do. Governance belongs in the implementation discussion from the beginning. It helps management decide where the company is ready to proceed and where additional work is necessary.
The Mortgage Compliance Dataset (MCD) illustrates the same collaborative approach in a different setting. The Conference of State Bank Supervisors (CSBS) describes the historical examination process as one in which data requests and file formats could vary by state, adding costs for lenders and examiners. Working with the Conference of State Bank Supervisors and industry participants, MISMO developed MCD to provide a standardized exchange of examination data.[2]
For a lender, that creates an opportunity to improve how information is prepared and delivered. For state regulators, a common format can support more consistent use of technology in the examination process. Realizing those benefits requires implementation by the organizations and systems involved. Publishing a dataset is an important step; making it usable in day-to-day operations is where the industry has to follow through.
Among MISMO’s greatest strengths is its ability to bring the industry together to solve business problems and transform complexity into progress. The Mortgage Compliance Dataset (“MCD”) personifies the benefit of collaboration and the effectiveness of implementation and adoption following that approach, uniting lenders, regulators, and technology providers around a standardized, transparent, modernized, and more efficient way of conducting state regulatory examination. MISMO’s new brand helps shine the light behind the scenes to invite greater industry participation to help define the terms and set the standards that don’t just improve how the industry operates; they define how and what the mortgage industry becomes next.”
—Joshua Weinberg , President, Firstline Compliance, LLC
The same principle applies to eNotes. On October 6, MISMO announced a development workgroup to create a standardized template for Tri-Party eNote Bailee Agreements. These agreements address the rights and responsibilities of lenders, warehouse lenders and investors in eNote transactions. The effort responds to repeated negotiations of substantially similar terms between trading partners.[3]
That work is underway, and its results will depend on the participants developing and adopting a useful agreement. It demonstrates why the industry needs a place to address obstacles that no single company can resolve on its own. A lender can improve its internal process, but an agreement involving several counterparties requires those counterparties to participate in the solution.
These examples also explain why participation needs to extend beyond the people traditionally associated with technical standards. A risk leader evaluating AI, a compliance executive preparing for an examination and a capital markets professional, warehouse lender, or operations executive working through an eNote transaction bring different expertise. Each can identify a problem or consequence that others might miss.
Our website refresh is part of the effort to make that connection clearer. Anyone who visits MISMO’s website should be able to see how our work relates to their role, and how their expertise could contribute.
That’s the goal for everything we communicate: help people quickly see how MISMO’s work connects to theirs. Our new brand is the perfect opportunity to reach more people and invite them to get involved. That is the standard I want us to meet as we communicate the breadth of this community’s work. The new brand gives us an opportunity to invite more people into that conversation.
For longtime contributors, the new identity should recognize the value of the work they have been doing for years. For people who have viewed MISMO as something their technology team handles, it should prompt a closer look. Decisions about governance and operational efficiency belong on the leadership agenda, and the people responsible for those decisions have something valuable to contribute.
“I came into this engagement squarely in the camp of mortgage professionals who knew the MISMO name, had probably seen the logo, but could not have clearly explained what the organization actually did. The deeper I got into the work with Brian, Amy, and the MISMO team, the more obvious it became that MISMO may have been the mortgage industry’s best-kept secret. Its standards have been shaping how our industry communicates and operates for more than two decades, and that impact deserves to be better understood and celebrated.”- James Duncan, Founder/Chief Marketing Strategist, Caelum Advisers.
I have long respected James as a strategic marketer and critical thinker, which put Caelum at the top of my list as we considered who could help us shape this important next chapter. I am grateful for the partnership in developing a brand that honors MISMO’s history and communicates where we are headed.
As industry leaders gather for MBA Annual, I would encourage each of us to identify one recurring problem that depends on cooperation outside our own organization and bring it to MISMO. Ask who else encounters it and whether a shared approach could make a meaningful difference. Then make room for someone on your team to help develop that approach and bring what they learn back into your business.
The words “our industry” carry an expectation of participation. MISMO can convene the people and provide a process for the work, but the practical knowledge comes from those doing the work every day. What we build next will depend on who shows up, what they contribute and whether we put the resulting solutions to use.
[1] MISMO Releases FRAME Framework for AI Governance in Mortgage Lending
[2] CSBS Catalyst Initiative Mortgage Compliance Dataset Tech Sprint
[3] MISMO Launches Workgroup to Standardize eNote Bailee Agreement
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