Rob Chrane, founder and CEO of Down Payment Resource (DPR), argues that the mortgage industry's approach to down payment assistance (DPA) needs standardization rather than simplification. He notes that despite the availability of thousands of DPA programs nationwide, offering an average benefit of $18,000, many lenders are reluctant to engage due to the programs' fragmented and inconsistent nature. This difficulty in accessing DPA leads to significant lost loan volume; Chrane's analysis of $6.5 billion in declined loans found that $1.8 billion could have been salvaged with existing DPA programs.
Chrane likens the current state of DPA data to the pre-automated underwriting system (AUS) era in mortgage credit decisioning, which was also fragmented and inefficient. He posits that the lack of a common data model for DPA program eligibility, benefit structure, income limits, and property requirements creates a structural barrier. This forces individual vendors and lenders to build custom integrations, an effort most deem not worthwhile.
The proposed solution is to establish data standards that allow DPA programs to be represented consistently within existing lender systems. Chrane believes the Mortgage Industry Standards Maintenance Organization (MISMO) is the ideal body to undertake this task, aligning with its mission to reduce friction through standardization. Such a foundation would enable LOS vendors to build support, POS systems to surface eligibility earlier, and secondary market participants to evaluate DPA-assisted loans with confidence.
Chrane emphasizes that this is not a request to consolidate programs but to create a data infrastructure that allows diverse programs to flow through the loan process automatically and consistently. He urges the industry to organize behind this initiative now, suggesting that a DPA data specification can be developed independently and later integrated into MISMO's broader Mortgage Ready initiative.
