replanning can help your
company keep its opera-
tions running smoothly
during major weather events
or other disasters. It also
is important for mortgage
originators to know the plan
— and know that one is in place — so they can trust
that their loans and their clients won’t be affected by
Your company’s business structure and size will
determine what types of disasters could directly
affect you. If you work for (or with) a regional-based
lender, then you will only be affected by events
that happen within the region where you operate.
A national lender or mortgage company should
prepare for a larger range of disasters. Regardless
of your size, the first thing your company should do
is to identify what types of disasters could directly
affect the business.
Make sure your company hasn’t limited its
preparedness to the corporate office or main
operations-support center, either. Large, national
companies should expand their plans to include
regional operations centers, branch operations
around the country, as well as key remote employees
who could be subjected to business disruption
because of a disaster event.
Make a plan
You may think your company has a disaster plan,
but are you sure? Is it in writing, or has your company just talked about it and assumes everyone knows
what to do? Until you are affected by a disaster, you
really do not know how prepared or unprepared
you really are.
You need to have a written plan of action that
covers all critical and noncritical business units
within your operations. For those who do not have
a plan, here are some items your company should
consider when writing out its plan.
First, plan for various types of disruptions.
Numerous major disasters can affect your business.
Hurricanes, blizzards and wildfires are the ones that
make national news. What about other events that
occur that could affect your operations?
Construction down the street can cut the fiber
line connecting you to the internet. What about
rolling blackouts that can take out your power grid?
Or how about that ice storm that snapped the power
line down the road? All of these incidents — minor
or major — could disrupt your mortgage processes.
When your company creates its plan, it must think
about and identify any possibilities that will directly
or indirectly affect operations and understand how
they could affect each area of operations.
<< Prepare continued from Page 75
It also is important to consider that disasters can
last hours, days, weeks and even months. Depending
on the severity of the disaster or event, you could be
lucky and get back to normal operations in less than
an hour, or you could be unlucky and have it last
several weeks, or longer.
Your company should identify how business could
be affected by either short-term or long-term events,
because either one can have a drastic impact on loan
closings, underwriting timelines and other loan processes. Your company’s plan should include multiple
scenarios, because each business area will need to
react differently when the plan is put into action. A
good rule of thumb is to be prepared for events that
last: one hour, two to four hours, four to eight hours,
one to three days, four to seven days, one week, two
to three weeks, one month, and multiple months.
Next, your company’s plan should identify criti-
cal and noncritical operations. Preparations should
be considered for multiple areas of operations, and
the plan should identify what is critical to keep
day-to-day operations up and running. When there
is a short-term disaster event, these critical opera-
tions must be kept up and running. When the event
becomes a long-term event, the company should
put into action a plan for maintaining noncritical
operations as well. Continued on Page 78 >>
In most cases, critical teams in a mortgage com-
pany include secondary marketing, loan processing
and underwriting, closings, funding and some of
post-closing functions. You want your company to
keep those areas of operations up and running no
matter how short the event is. Different compa-
nies will have different time intervals for when they
move to start preserving noncritical functions. Most
companies have all teams become “critical” by day
five of the disaster event.
Finally, your company’s plan should determine
how each team will work during the disaster. Today,
most loan origination systems are internet-based
so, for most companies, their critical teams should
work on laptops instead of desktops. Most remote
employees already have laptops, which is a huge
benefit for those teams because they can work outside the office — outside the disaster-event area —
and continue to keep business moving.
For noncritical teams, your company must determine how it will support them if they need to be
put into action. It could be as simple as having some
desktop computers on standby that can be shipped
to a remote location, where noncritical employees
can work. It also is possible to contract with a business
disaster-preparedness company that can drop a trailer