Invented by Richard Sheridan Collins, Shane Michael Leonard, Ranier Ip LLC, Ranieri IP LLC
The Ranier Ip LLC, Ranieri IP LLC invention works as followsApparatus for ingesting legacy records of mortgage loan servicing activities onto a Blockchain.” The legacy data is converted into a block format from a relational format. It can then be entered in one or more blocks of a blockchain. Parts of the blockchain will be distributed to the Participants, including the Borrowers and Regulators. The present disclosure also provides a method of homogenizing a number of Vendor Formats to be included on the Blockchain, and memorializing the execution of a Smart Contract on the Blockchain.
Background for Methods for ingestion into a blockchain mortgage servicing of legacy records
Loan servicing is currently a highly-decentralized industry. It features a maze of heterogeneous data formats and standards across a variety of Participants, including Borrowers and Servicers.
As a result, even small changes in the status of a Loan or an event related to the Loan may take significant time to reach all Participants involved in the loan and the accuracy of the information is not always certain. It is possible that different Participants may take inconsistent actions because of outdated data. Servicers and Investors also lose substantial amounts of money every year because of missing loan documentation and regulatory fines.
The mainframe programming languages used by most loan servicers are outdated and often provide a rigid and fragile user interface. Many of these were developed decades ago.
A user who wants to check the status of their Mortgage Loan or understand why certain events are occurring may have to pay Click Through Fees to get access to their data. They may also need to be authenticated and retrieve data in different locations. Data from different locations might not be consistent, which makes matters more complex.
The loan servicing industry has a high level of regulation. Each user could be the custodian for at least some sensitive data, which may be protected by law from disclosure or insufficient data protection.
Relatively, not every user is allowed to view all the data for a mortgage loan. While a Borrower is entitled to view all documents pertaining to their Loan, they may not have the right to listen to an audio recording between the Lender and the Legal Counsel regarding a loan. A Vendor who provides an appraisal shouldn’t have access to the entire Mortgage Loan file. For example, they may not know the Borrower’s Social Security Number or any other personal data.
Also, the known loan servicing system must necessarily involve asymmetrical trust levels. Some Participants might have financial incentives (or accidentally modify documents) to do so. Previous systems provide little or no deterrence to document modification.
Mortgage loan servicers make things worse by developing proprietary “add-on” technology. The technology causes a number of disparate systems that are prone to creating process gaps and data quality issues.
The present invention, therefore, provides methods and apparatus to move away from legacy Mortgage loan servicing platforms into a Blockchain platform. The present invention provides methods and apparatus for transferring legacy Mortgage Loan servicing records to a Blockchain platform that allows transparent access while providing safeguards to prevent subsequent intentional or accident document modifications, tracking access documents, eliminating Click Through tracking, and centralizing a decentralized process. The present system eliminates click-through fees charged to customers to access their data, ensuring transparency in Mortgage Obligation servicing.
The present invention uses Blockchain technology to provide Participants with an updated certified correlation of actions performed, recording of an identity as to who executed respective actions and certifying information, such as a leadger of actions taken on Loans, as well as associated data (e.g. time, place, users), thus ensuring Participants: (a), can only access specific Loan Documents which a specific Participant is authorized for access; (b), cannot modify a prior action; and, (c) are able to easily add new Loan Action
In some embodiments, an Ingestion Controller can receive data in different formats, such as those used by Participants and Vendors. The current format variations are causing considerable delays, inaccuracies, and difficulties in tracking Obligations in the Mortgage Loan Servicing process.
In some embodiments, an Ingestion Controller accepts legacy mortgage servicing records as Vendor Records and writes the legacy records into a Blockchain in the same Vendor Record Format that the legacy records were received. In other embodiments an Ingestion Controller converts the data from a Vendor format to a standard Servicer Format used by Blockchain, and writes converted legacy record on the Blockchain in one or more Ledger Entries.
In other embodiments, the Vendor may be one of many known Participants. Each Participant can use a known (if heterogeneous data format). The Ingestion Controller can convert data from a vendor format to a servicer format and then store it in the Servicer Format onto a Loan Blockchain. In some embodiments, the Ingestion Controller can translate data from a Loan blockchain in a Requested Vendor Format. Data retrieved from the Loan Blockchain can be sent to a participant in either the Servicer Format or the Vendor Format.
Preferred embodiments use a single Blockchain to store all entries related Mortgage Loan Servicing. However, some embodiments can include multiple Blockchains in order to support Obligation servicing or Mortgage Loan Servicing. For example, a vendor-specific Blockchain or a functionality-specific Blockchain (e.g. Payment transaction Blockchain or loan owners Blockchain. A master Blockchain can track entries in other Blockchains that are part of a hierarchy or relational group.
In a third aspect, a Blockchain may include an Artifact or acknowledgement of its generation. A Smart Contract, an online submission with an electronic signature verification, an image of a paper or any other quantifiable action can be stored electronically.
In some embodiments, a Mortgage Loan can be serviced using a Blockchain. The Mortgage Loan Obligation can be created based on a transfer of money from one party to another. It may also be secured by a collateral asset, such as mortgaged property. Initialization of a Blockchain occurs on a computer that can be accessed via a digital communication network. The Blockchain can include multiple blocks that are time-sequential, each Block storing data related to the obligation.
The Obligation can be memorialized on the Blockchain as an agreement for a Mortgage Loan.” The Blockchain may be expanded by adding a first block, which includes a record of the Mortgage Loan Agreement. The Blockchain can be sent to a Loan participant via the communication network.
The Blockchain can be configured so that Action data for a Loan Action is included in a Block and then appended to the end of the Blockchain in the form of a second Block. A Block of access rights may specify the portions and methods by which a Loan Participant can access a first and second additional block.
A communication network, such as the Internet, may be used to send the Blockchain to a Loan Participant. The Blockchain can include blocks that store information memorializing a Mortgage Loan Agreement, a first Additional Block that memorializes a Mortgage Loan, and subsequent blocks that contain documents of records taken. The first additional block, the second extra Block and subsequent blocks of the Block chain may be accessed based on the access rights assigned to a user.
In another aspect of this, the Mortgage Loan Agreement may memorialize the notification of a mortgage loan payment and the notification may be stored on a third block additional to the Blockchain. The third additional block may have an access right granted to the Loan Participant. Access rights include, for example, the ability of a Loan Participant not to be able access the information contained in the Block but to know it exists.
In some embodiments, a Artifact can be received that quantifies an inspection of a Collateral Asset like a mortgaged home. The Artifact can be stored in a Block additional to the main Block, and a right of access for the Loan Participant is established. “An Artifact could, for instance, be an appraisal of a Collateral Asset, such as a mortgaged property, and stored in a still other Block. Access rights can then be established for the loan participant to the additional block.
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