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Mortgage consulting

Mortgage Solutions
Mortgage Solutions
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Services
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OVERVIEW

Mortgage consulting

Milliman is dedicated to delivering customised and cost-effective solutions to measuring and managing the unique risks associated with originating mortgages, providing credit enhancement and risk share analytics, as well as targeting servicing efficiencies.

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Industry Expertise

In Milliman’s mortgage group, you’ll find industry experts, each bringing extensive experience across the mortgage lifecycle. Our team consists of industry executives well-versed in origination, servicing, capital markets, and investment. We are dedicated to delivering unparalleled insight and tailored solutions for your success.

Tailored Solutions

Through close collaboration, we understand your unique needs, delivering tailored services, data-driven approaches to modeling, and advice crafted for your distinct success. Our commitment is to provide solutions that precisely align with your requirements and business model.

Advanced analytics

As a quantitative analytics industry leader, we offer transparent, intuitive analytics supported by loan-level mortgage data. Explore our suite of seamlessly integrable mortgage models, detailed in Milliman M-PIRe.

Our services

Secondary marketing and capital markets Mortgage origination Mortgage servicing
Services Outcome
Delegated hedging services Our delegated hedging strategies are designed to minimize risk and optimize value. Milliman has trading desks around the globe and utilizes the most advanced financial risk management techniques to deliver superior results to clients.
Pricing review Milliman performs holistic pricing structure/waterfall assessments across products to evaluate consistency and areas of improvement for strategy, risk management, and P&L. Deliverables for this work depend on the client’s needs and may include a report of findings, a re-structuring of the pricing waterfall, or other deliverables as requested.
Hedging & Trading Review A report providing a robust assessment of all areas of financial risk management. Risks include liquidity, credit, spread, interest rate, counterparty, investor delivery, extension, and product risk. Internal models are available to provide a champion/challenger model comparison.
Best Execution Design A report documenting and modeling optimal execution strategies. The report provides a road map to process improvement and engagement in more sophisticated execution strategies (PLS, RMBS, aggregation etc.).
More Services
  • Pricing
  • Hedging and trading
  • Valuation and benchmarking
  • Risk review, modeling, reporting, and measuring
  • Cash versus mortgage-backed securities (MBS), residential mortgage-backed securities (RMBS), uniform mortgage-backed securities (UMBS)
  • Retained versus released strategies
  • Mandatory versus best efforts
  • Aggregating and selling pools
  • Path to private-label securities (PLS)
  • Liquidity review and counterparty reviews
  • Set-up and design of secondary and capital markets policies, processes and procedures.
  • Alternative hedges (model and benchmarks)
Services Outcome
End-to-end review of cost to originate Complete assessment of margin, pricing spread, fixed and variable costs of origination. The assessment includes recommendations on how to allocate cost across the origination process, strategies to analyze P&L, and recommendations on where you can optimize value.
Assessment of process-flow improvements Non-financial assessment of point of sale, processing/underwriting and manufacturing of the mortgage loan process. Our team has expertise in both the manufacturing process and post-closing / secondary marketing delivery processes.
Loan level performance attribution A discrete P&L attribution analysis tracking loan level profitability. We will identify loans cohorts that are profitable, understand why they are profitable, and work with you to optimize mortgage profitability.
Full credit review, reserving, and risk management strategies Alignment and documentation of risk management strategies. We help clients design, test, and document how risk is being managed or transferred.
Risk appetite statement set-up A complete Risk Appetite Statement. We design a best practices Risk Appetite Statement covering three lines of defense. The Risk Appetite Statement is developed from Board/Executive Committee direction.
Liquidity review A robust assessment of daily, monthly, quarterly liquidity through multiple lenses. This includes reviews of trading, counterparty, investors, servicing, operational, and product liquidity.
Repurchase analysis Milliman provides a loan-level model to estimate repurchase exposure at origination to evaluate the risk of repurchase, set reserves, and optimize QC processes.
More services
  • End-to-end review of cost to originate
  • Assessment of process-flow improvements
  • Loan level performance attribution
  • Full credit review, reserving, and risk management strategies
  • Risk appetite statement set-up
  • Risk limits, targets and guideline structure
  • Liquidity review
  • Mortgage Origination Risk Assessment (MORA) preparation
  • Corporate structure and organization chart assessment, including checks and balances, and government-sponsored enterprises (GSE) compliance
  • Pipeline valuation and risk assessment
  • Comprehensive policy, process, and procedure reviews
  • Credit scoring and modeling
  • Financial and non-financial risk assessments
  • Risk measure, modeling, and mitigation strategies
Service Outcome
MSR review/assessment Complete MSR valuation and reporting. We advise on MSR risk management strategies to develop a strategy that minimizes risks to our clients while preserving value.
Investor Reporting/Compliance Financial and non-financial reviews of compliance to seller/servicer guidelines for investors and guarantors.
Performance modeling / risk measurement Modeled forecast of servicing advance needs and potential default management strategies including sales, assignments and modifications.
More services
  • Valuation-assumptions assessments of mortgage servicing rights (MSRs)
  • Third-party benchmarking for counterparty risk
  • Comprehensive end-to-end risk review of processes
  • Third-party surveillance set-up (sub-servicer oversight)
  • Financial and non-financial risk assessments, measure, monitor, and report
  • GSE compliance reviews
  • Liquidity and advance reviews for Government National Mortgage Association (GNMA)
  • Risk for Federal Housing Administration (FHA) and Veterans Administration (VA) loans
  • Loss-mitigation strategies
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Milliman M-Pire

A turnkey suite of analytical tools to manage mortgage opportunities including whole loans, MSRs, & credit risk transfer securities (bond and reinsurance).

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Insights

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We’re here to help you break through complex challenges and achieve next-level success.

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Contact us

We’re here to help you break through complex challenges and achieve next-level success.

Contact an expert
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