Servicing valuations and privacy requirements

Third-party servicing valuations have become fairly routine in the mortgage banking industry. When complying with these valuation obligations, however, it is important that firms not overlook their privacy obligations. Obtaining valuations from third-party vendors requires that borrower data be transferred to nonaffiliated third-party vendors. The Gramm-Leach-Bliley Act gives consumers a tremendous degree of privacy protection over this data. Nonpublic information held by financial institutions is viewed by the lawmakers as similar to the other assets that may be entrusted to you by your customers. Financial institutions must fiercely and diligently protect them. There have already been several privacy related actions.