Candor Technology: A Perfect Loan in Seven Seconds

Thomas Showalter, CEO, Candor TechnologyThomas Showalter, CEO
What do mortgage origination and rocket science have in common? For starters, complex calculations, elaborate workflows, enormous risk, and a zero tolerance for errors. Enter Rocket Scientist Thomas Showalter, who in his early career solved critical System Safety Engineering challenges at NASA, and over the last 30 years solved complex problems in leadership roles with industry giants. Showalter recently introduced Candor Technology, whose first of its kind Loan Engineering System (LES) is poised to eclipse everything we thought we knew about fintech.

What exactly does this Loan Engineering System do? In short, LES is a hidden figure, a SAAS working behind and alongside the existing technology stack to underwrite an error-free loan 100 percent of the time. As expected with an AI offering, LES automates repetitive tasks using AI Robotics, or RPAs. That time savings reduces cost, and compresses timelines. But, there’s more to LES than automation.

Exceptional Quality: More BPS on Both Ends

LES’s value proposition lies as much in loan quality as speed to close. While LES can perform a complete underwrite in a remarkable seven seconds, what’s equally impressive is the defect-free loan quality. A defect free loan eliminates repurchase risk and could ultimately fetch a higher price when sold into the Secondary Market. “Originating a poor-quality loan faster doesn’t solve back office problems, nor can it generate profits,” commented Showalter.

This high quality underwrite is achieved with a second form of AI Showalter developed specifically to eliminate the quality erosion that can occur through human error, or, during the quest for a speedy close. This proprietary Loan Integrity AI validates and verifies data to assist in the complex decisioning process typically performed by the Underwriter.

Underwrites a loan in 7 seconds. Shaves 78 percent off underwriting

For example, to validate and verify data integrity on income and assets, LES uses direct source data to conduct a statistical analysis by triangulating data through double-triple redundant systems. In lay terms, LES applies aerospace technology to confirm the validity and accuracy of the data, even in complex situations such as self-employed, or multiple income sources.

Once accessed via an integration with the LOS, LES runs behind the scenes to perform a large swath of origination work, including assessing program eligibility, verifying property value, validating docs, and clearing conditions all along the way. This results in a loan free of defects.

The fintech company is so confident in the quality of the final product, it offers a defect insurance policy on all qualifying loans.

Blockchain: Database Confidence

Building a database on Blockchain is how LES instills confidence in the Secondary Market. That incorruptible digital ledger provides a full accounting of every entry, addition, and modification of data made to the file across the origination process. The transparency enabled through a Blockchain database provides loan buyers clear visibility into the risk. “Blockchain’s true value in the origination process and Secondary Market has yet to be realized,” said Showalter.

The Long Term Impact

The holistic aspect of LES does more than repair what’s broken, LES prepares companies for future economies. LES provides the ability to grow aggressively without adding staff. Candor provides a systematic analysis of the loan allowing processors and underwriters to practice the art of loan manufacturing.

ROI: The Sky’s the Limit

Through time studies and actual costs, one client reported time savings across the process, and significant cost savings. This correspondent lender’s cost to produce a loan went from ~$1500 to $495. In addition, they were able to sell loans faster, and for a higher price.