Understanding Income and Employment Verification Pricing

Income and employment verification pricing can be incredibly complicated, especially when you receive cryptic invoices with confusing language or during annual price increases. This gets even more obfuscated if you're bringing in verification data from multiple vendors. With Truework, we want our pricing structure to be as transparent and easy-to-read as possible, so you know exactly what you’re paying for. This guide will not only help you understand Truework’s pricing, but also assess your current pricing agreement with a legacy provider, and put you on a path to gaining more flexibility and control in pricing for the future.

This guide encompasses mostly pricing for mortgage lending verifications. Looking for pricing information on consumer lending? Truework also provides verification of income and employment for consumer lenders providing auto loans, personal loans, and student loan refinancing.

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How Truework prices and plans work

First, let’s break down a few pricing terms and Truework plans:

Pricing Terms

• VOI/E = Verification of Income and Employment
• VOE = Verification of Employment
• Re-verification = Re-confirming employment, this generally happens a few days before close to re-verify if a borrower still has a job.
• Third-party = When the verification is sourced from a provider other than Truework.

Note: Third-party verifications can be more expensive to lenders than the average verification. But rather than having to manage 20 different providers and bills, Truework provides all of the data under the same report with a unified bill.

Truework pricing plans

Pay-As-You-Go tier. Simple and fast verifications for loan processors and teams to pay per verification, instead of bulk committed buys. This tier is popular with individual loan processors who need verifications as one-off situations since there is no minimum commitment or contract timeframe.

Enterprise tier. Lenders and teams receive a volume-based verification pricing discount, with dedicated customer support and custom integrations. This is a committed contract to lock-in pricing. Truework, unlike your typical verifications vendor, keeps a commitment to this pricing.

How legacy provider pricing works

In the income and employment verification business, most vendors raise their price on an annual basis. Price increases can be tough to navigate and negotiate, which is made all the more challenging by the current macroeconomic conditions. With this level of market uncertainty, it can be overwhelming.

Something to be on the lookout for is that many providers price VOI/E data as all-or-nothing, without giving you transparency into whether or not you’re purchasing active or inactive data. You may not need all of this data, but there is no way to control what you receive, and especially, pay for only what you need.

Years ago, legacy providers removed the ability to filter results in VOI/E data. This change decreased data relevance and resulted in increased costs for lenders overall. There are two big changes legacy providers made that directly affect your data’s relevancy as a lender:

1. Inability to filter data based on status – Let’s say you are a mortgage lender that already has inactive employment verified, all you need is active data. You’re stuck purchasing both, getting charged for data you didn’t need.

2. Inability to filter data based on employer – Let’s say you’re only interested in the data from a certain employer. If your vendor removed the ability to filter data based on that employer, yet again, you’re stuck purchasing the entire package of data instead of simply getting one employer’s data.

Some legacy vendors tout an ability to “increase revenue per transaction by increasing data depth”. Perhaps assuming that the more data you have, the more likely it is that those data points can bring in revenue. But if you already had parts of this data then purchasing the whole package with “additional data depth” is an unnecessary expense.

Another unnecessary expense is that until recently, legacy providers returned over seven years of data. Even though mortgage underwriters only look for 24-36 months of employment and income history when underwriting a loan. Additional data can be a pain as it forces teams to sort through and analyze more information than is required. This forces credit and underwriting teams to sort through and analyze years of unnecessary information, slowing down the origination process and increasing the costs per loan. Luckily this has changed, but it underscores the importance of receiving the data you actually need with income and employment verifications.

Breaking down your overall price

Understanding the breakdown of what you’re paying for and how much you’re paying for it gets a little complicated with legacy provider invoices. Especially when your only option is to purchase all of the results without visibility into what is or is not included.

Fannie Mae loan terms require that you have 24-36 months of employment history. As an example, let’s take a sample borrower that has one “active” employer and three previous or “inactive” employers. Say you already have this borrower’s “active” employer, you only need their “inactive” employers. Let’s assume the cost is $54.95 for each set of data. With a grand total of $109.90 for both active and inactive sets of income and employment data. There are three things to keep in mind:

• Per unit price - This is the charge for each set of data. Legacy providers package inactive and active data together as one price, so this could also be called the total transaction price. But critically per “unit” is important to pay attention to.
• Data correctness/accuracy - Do you pay for incorrect or unusable data? If so, your “units” increase.
• Data relevancy - Do I even need this data point? If you are forced to pay for “units” you do not need, your total cost goes up.

Scenario 1: You need active data, the VOI/E provider only has inactive data.

With a legacy provider, the pricing isn’t clear. Are you purchasing active or inactive data? Before submitting the request, you may have had no idea that you would be charged for information you already had and did not need. While the per unit price stayed the same, the data relevancy was off, so the total cost per unit has increased.

Scenario 2: You need inactive data, the VOI/E provider provides both active and inactive data.

A different scenario would be when a legacy verification provider returns both active and inactive data. In this case, you get exactly what you are looking for (inactive data) but are still charged an additional $54.95 for the redundant active data, skyrocketing your verification cost to $109.90 ($54.95 for active data + $54.95 for inactive data). Instead of purchasing the one unit of information you needed, you’ve purchased two units.

In both scenarios the inability to filter active vs. inactive data with a legacy provider forces you to overpay for unnecessary or irrelevant data. You are forced to pay for the “whole package” of data without any insights into what is included within that package. Using the prices outlined in the examples above, you incur an unwanted $54.95 charge in every one of these instances.

What about data accuracy?

In the examples outlined above, we assumed that all of the data was accurate. But what if it isn't? Are you paying for data, whether or not it’s accurate? With your typical legacy vendor, the answer is Yes. When you receive data that has a missing date or pay fields, not only is the data inaccurate it’s potentially unusable as well. Inaccurate data increases your per-unit price and by extension, overall price, since you have purchased units of data that you are unable to use. Many vendors make it difficult or impractical to pursue recourse if you receive data you cannot actually use. To be fair, this isn’t necessarily the direct “fault” of the vendor; some inaccuracies may be caused by underlying data quality issues in payroll or other employer record keeping systems. Ask yourself, though: do you want to be on the hook for these data quality issues?

How Truework ensures data accuracy:

At Truework, we hold ourselves to the highest standard possible, regardless of the source of the error. You will never pay for data that is unusable or inaccurate, simply let us know which verification you have an issue with and we will either reopen and remediate it free of charge, or strike the payment altogether.

What should I look for in a vendor?

Every lender knows there is not a “one-size-fits-all” approach to income and employment verification. Here are three recommendations on what you should look for in your income and employment verification vendors:

Ability to choose between active vs. inactive data

The scenarios above included just a few examples of why the removal of the active vs. inactive filter is so detrimental to a lender’s business. Lenders deserve the flexibility to choose which set of data they require for any given borrower. When legacy providers make these kinds of changes, that choice no longer exists. Look for a vendor that gives you this filtering choice.

Transparent pricing

When you purchase income and employment verification data as a “whole package” or an “all or nothing”, you rarely get the under the hood look into what you are and are not paying for. Like the example lender, you could be paying for inaccurate, unusable or redundant data. Look for a vendor that is transparent with what you are buying and doesn’t hide behind cryptic invoices.

Total cost to you if the vendor fails to verify income or employment

Some borrowers, like the self-employed, will require additional documentation such as tax transcripts, while others, like gig-economy workers, are better suited to share their data directly from their payroll provider through a user-permissioned solution. Many legacy providers are not able to verify these workers. But if the vendor fails to verify, you may still get stuck paying for the data. Look for vendors that work verification failure into their pricing model, or better yet, won’t cost you anything if they fail to provide the verification.

How Truework keeps lender’s best interest in mind

Truework allows lenders to verify the specific information they need for any given applicant. This is done by empowering lenders to choose which employers they’d like to verify when submitting a request. When an employer is not selected, Truework will verify as many employers as possible via the instant network.

The biggest difference between Truework and legacy verification providers is that Truework charges one single price per instant verification. Truework does not double charge for active and inactive data and gives you the ability to filter between these data sets. You pay only for what you need, and you never pay for unusable or incorrect data.

Don’t get charged for inaccurate data. Truework regularly re-opens cases with any reported inaccuracies and manually follows up with the employer, and does so free of charge to the lender. Additionally, Truework provides underwriting teams increased data visibility by returning borrower paystub data whenever requested.

Truework: the only one-stop VOI/E solution

Truework strives to be the industry’s only one-stop platform solution with every major verification method under one roof, providing coverage for 95% of U.S. employees. These methods include:

• Instant data (with Day 1 Certainty® eligibility)
• User-permissioned payroll data
• Data from third-party verification providers
• Data retrieved directly from HR departments
• Data provided in the form of W2s and paystubs

Routing each request to the fastest method possible based on the borrower’s employer, Truework helps lenders reduce verification costs and accelerate loan cycle times.

Truework builds solutions with lenders’ best interests in mind. Can you say the same for your current provider?