The primary sources of assumable mortgages are the government-guaranteed products from the Federal Housing Administration, Veterans Affairs and the U.S. Department of Agriculture.

While home sales are a primary reason why consumers are looking for an assumable mortgage, lifestyle changes such as a divorce are also a driver.

However, doing these transactions also requires a lot of work and additional costs by the mortgage originator. That is one of the reasons why FHA is doubling the maximum fee that can be charged to $1,800.

The enhanced feature was first in beta with a client who has a large servicing portfolio; Dark Matter has been adding more customers before bringing it out to users at large, said Craig Rebmann, its product evangelist.

It is a fully task-based process for assumptions within Empower that continues Dark Matter's efforts to make operations more efficient and exception-based.

"The big thing about assumptions is that they are almost entirely manual from a standard process perspective for lenders because they don't necessarily have a way to pull data from the servicing system into a loan origination system," Rebmann said.

The lender also has to pull in by hand the original loan documents as well.

"They may or may not have a document provider who is preparing documents related to assumptions," he continued. "The process is really highly manual and painful because they're just not that many assumptions that end up getting processed every year."

In the past, lifestyle reasons had driven the assumption transactions and that was one of the catalysts for that large lender to seek this from Dark Matter in the first place.

But with interest rates expected to remain higher for longer and few signs of a significant change in the inventory shortage, these transactions have become increasingly popular with sales. Roam, a company that facilitates assumptions, recently entered into an agreement with Spring EQ for the latter to provide second mortgage financing to create enough equity for such a transaction to occur.

The particular lender involved in the beta had a large enough servicing portfolio that created enough volume where it was a pain point to do an assumption.

They were looking for efficiencies in a process that lenders had noted could take months to complete, Rebmann pointed out.

"We built out the process to be able to pull down the data from MSP to be able to process the assumption, determine whether or not it needed to go through an underwrite; many of them don't," Rebmann noted. "But if it did need to go through an underwrite, pass it through the underwriting process and then be able to push that data back and do the changes to the servicing record that are necessary through another integration push to MSP."

Currently the integration is only with MSP, the most-used servicing technology of record. Until last year, both Empower and MSP were owned by Black Knight, but because of the sale to Intercontinental Exchange, the origination technology business was divested; it is now known as Dark Matter.

Empower had been pulling data from MSP for a while, primarily for refinancings, and assumptions is just one more use case for the interface between the two systems, Rebmann said. Dark Matter is not opposed to integrating with other servicing platforms.

The ties Empower has with various document preparation companies also is key for leveraging the assumption process and making it cleaner for lenders, he added.