CoreLogic shifts focus to appraisals, moves away from loan origination software
Moves to accelerate appraisal management company “transformation”.
In the last few years, CoreLogic has significantly grown its valuations business through a series of acquisitions, including a la mode, Mercury Network, LandSafe Appraisal Services, FNC, and RELS. And now, the company is sharpening its focus on appraisals and moving away from other “non-core” parts of the company.
CoreLogic announced late last week that it is planning to “exit” its “legacy non-core software platforms,” including its loan origination software unit and its remaining legacy default management related platforms, over the next two years.
The loan origination software in question came from Dorado Network Systems, which CoreLogic acquired back in 2011 for $32 million. Now, CoreLogic is planning to move away from the LO platform.
According to the company, the “non-core” platforms in question generated approximately $40 million in revenue during the first nine months of 2018.
But the company said that moving away from those non-core operations will help position the company for increased profit and “enhanced long-term organic growth trends.”
As part of the move, CoreLogic said that it now plans to “accelerate” the “transformation” of its appraisal management company operations. According to the company, that transformation will make use of “data-driven analytics, automation of workflows and enhanced utilization of (the company’s) dedicated staff appraisers.”
The company claims that the moves will “improve client satisfaction, reduce appraiser turn times, enhance quality and increase productivity.”
As stated above, the moves comes after years of CoreLogic bolstering its valuations business via acquisitions.
Earlier this year, CoreLogic bought a la mode. Two years ago, CoreLogic closed on the acquisition of FNC, a provider of real estate collateral information technology and solutions that automate property appraisal ordering, tracking, documentation and review for lender compliance with government regulations, for a total purchase price of $400 million.
That deal came on the heels of CoreLogic purchasing LandSafe, an appraisal management company, from Bank of America for $122 million in 2015.
CoreLogic purchased the rest of RELS, a provider of property valuation and appraisal services, from Wells Fargo in 2016 for more than $60 million.
Then, in June 2017, CoreLogic announced it was buying Mercury Network, a purchase valuation technology company, from Serent Capital, which bought Mercury Network from a la mode back in 2015.
In the time that Serent-owned Mercury Network, the company acquired Platinum Data Solutions, a QC technology company, in 2016, and Appraisal Scope, a valuation management software provider.
All of that is now under CoreLogic’s valuations empire, and the company views appraisals as a business opportunity moving forward.
“CoreLogic remains focused on capitalizing on our scale and market leadership and the opportunities presented by our must have workflow solutions in the U.S. mortgage market,” CoreLogic President and CEO Frank Martell said. “The actions we are announcing today should further position the company to achieve its 30% margin target and enhanced organic growth rates in 2020.”
CoreLogic said that the “acceleration” of its AMC transformation program is expected to result in lower revenue in 2019, but the company expects to enhance its overall profit margins and “improve underlying organic growth trends in 2020 and beyond.”
Source: Housing Wire