Mortgage Quality Control Industry Trends Report Q1 2024

This report is an analysis of post-closing quality control (QC) data derived from loan files analyzed by the ACES Quality Management and Control® benchmarking system during the first quarter of 2024 (Q1 2024). It incorporates data from prior quarters and is based on quality control data from tens of thousands of unique records. The report identifies an overall critical defect rate that rose to 1.58%, ending five quarters of decline. While defects improved in two of the four major underwriting categories, a significant rise in Credit-related defects offset these improvements. The report details the trends in overall origination volumes and the categorization of defects using the Fannie Mae loan defect taxonomy. It also discusses the implications of regulatory changes on defect rates and highlights the need for lenders to maintain diligence in quality control processes. The findings indicate a concerning trend in the mortgage industry, particularly regarding compliance and credit defects.