Always Audit-Ready: Using Encompass & Calyx to Keep Compliance Locked Down

If a regulator walked in today, would your loan origination system (LOS) back you up—or blow things up?

For mortgage companies and financial service providers, “maybe” isn’t good enough. Your LOS—whether it’s Encompass, Calyx, or both—needs to be audit-ready all the time. Why? Because audit prep is no longer just a best practice—it’s your frontline defense against penalties, disruptions, and reputation damage.

This blog is your guide on how to proactively tune your systems for regulatory reviews, spotlighting the built-in tools, workflows, and compliance features that can save you serious headaches later.

The High Stakes of Mortgage Compliance

The regulatory landscape in mortgage lending is no joke. It’s a dense, high-stakes web of laws and oversight, and missteps can cost you more than just fines. And real talk, while the tasks are getting easier with evolved LOS’s, the compliance is going to ramp up even more. Find out why in our blog, The Evolution of Mortgage Interfaces: What to Expect in the Next 5 Years. 

Mortgage companies must comply with a long list of federal regulations, including:

• TILA – Truth in Lending Act, ensuring clear disclosure of loan terms and costs
  
  
• RESPA – Real Estate Settlement Procedures Act, designed to protect consumers from hidden fees and kickbacks during the mortgage process
  
  
• ATR/QM – Ability-to-Repay and Qualified Mortgage Rules, which require lenders to verify that borrowers can realistically afford their loans
  
  
• TRID – TILA-RESPA Integrated Disclosure Rule, mandating standardized, easy-to-understand loan estimates and closing disclosures
  
  
• HMDA – Home Mortgage Disclosure Act, requiring detailed data reporting to prevent discriminatory lending practices
  
  

Oversight comes from agencies like the Consumer Financial Protection Bureau (CFPB), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC)—each with the power to issue serious penalties for non-compliance.

We’re talking civil money fines, forced remediation plans, or even bans from mortgage lending altogether. And yes, the CFPB has recently brought the hammer down on several institutions.

But here’s the opportunity:
Being audit-ready isn’t just a shield—it’s a signal. It shows investors, partners, and borrowers that you take compliance seriously. In a competitive market, that kind of trust is gold.

Comparing Encompass and Calyx for Audit Preparedness

Encompass Compliance Advantages

Encompass from ICE Mortgage Technology is the industry’s leading digital mortgage platform. It’s packed with robust automation capabilities, real-time compliance checks, and deep integration with the AllRegs platform for the latest federal and state regulatory updates. Its compliance service automates testing for KBYO, ATR/QM, TILA, HOEPA, HMDA, NMLS licensing, and more, letting you detect and fix compliance gaps instantly. Encompass also enables:

• Customizable workflow automation to standardize compliant processes.
• Integrated document management and e-signature capture, reducing paperwork risks.
• Deep third-party integrations for credit, appraisal, and underwriting data.
• Real-time audit trails, allowing quick retrieval of required documents when auditors call.

Advanced features do mean more complexity. Effective Encompass onboarding and optimization often require training and a well-developed governance structure, but the payoff is a scalable solution that stands up to the strictest compliance scrutiny.

Calyx System Strengths

Calyx Point, trusted by smaller lenders and brokers, is known for its intuitive interface and solid compliance basics. Calyx streamlines essential processes like document management, pipeline tracking, and electronic signatures, making it easier for teams to keep files organized ahead of reviews. Key strengths include:

• Structured loan processing and document workflows, and minimize missing or incomplete files.
• Affordable, user-friendly platform well suited to smaller teams needing core compliance tools.
• Customizable templates for standard and state-specific forms and disclosures.
• Reliable customer support and training, so even lean compliance teams can get quick answers.

While Calyx may lack some of the advanced automation and integration of Encompass, it excels at making compliance approachable and manageable for smaller operations.

Building a Culture of Audit Readiness—Without Losing Your Mind

Whether you’re working with Encompass, Calyx, or a mix of both, having great technology is just the beginning. Audit readiness isn’t a one-and-done task—it’s a mindset.

It’s about creating a culture where compliance is second nature, not a scramble when examiners show up. That takes clear policies, ongoing training, consistent monitoring, and the willingness to improve before you're forced to.

Here are six practical ways to get there:

1. Conduct Routine Risk Assessments

Start by figuring out where you’re vulnerable. Review which federal and state rules apply to your business, then match them against your current workflows. Both Encompass and Calyx let you map risks and fine-tune workflows, so use them to close gaps before they become problems.

2. Keep Your Policies Clear (and Easy to Find)

Everyone should know where to look when they need guidance. Keep your compliance policies updated and accessible directly within your LOS. Use Encompass Docs Solutions or Calyx’s template systems to make sure changes are tracked and everyone’s on the same page.

3. Use the Built-In Compliance Tools You Already Have

Don’t reinvent the wheel—Encompass offers automated compliance checks across TILA, RESPA, HMDA, and more. Calyx provides customizable checklists and smart reminders. Leverage these features to stay ahead of changes instead of reacting to them.

4. Monitor and Test Like It Matters (Because It Does)

Set a schedule for compliance monitoring that matches your risk level. Use Encompass for rule-based audits and real-time exceptions. Calyx's reminders and reporting features are great for keeping files fresh. And when issues do pop up? Log them, track them, and fix them fast.

5. Train Like You Mean It

Compliance isn’t just for the legal team. Make sure everyone—yes, everyone—gets regular, role-specific training. Use built-in training tools in Encompass and Calyx, and don’t just assume it sticks. Check for comprehension and revisit key topics often.

6. Get Serious About Oversight

Who owns compliance in your organization? Make sure responsibilities are clearly defined and tied to leadership. Build in accountability through Encompass's granular permission settings and audit trails, and establish board-level visibility to keep your governance sharp.

Responding to Regulatory Changes

Mortgage compliance is a moving target. Both Encompass and Calyx regularly update product features to reflect new state and federal requirements, but these updates only help if you’re actively monitoring and implementing them.

Audit-Readiness Checklists for Both Platforms

For Encompass Users

• Review and update built-in compliance tests quarterly.
• Set up automated alerts for policy and document changes.
• Run sample audit reports using AllRegs to find any missing elements.
• Verify that user permissions align with compliance roles.

For Calyx Users

• Audit disclosure and document templates against current regulations.
• Confirm that pipeline tracking and reminders are up-to-date and in use.
• Schedule periodic export and review of file history and activity logs.
• Test e-signature and document storage integrity.

Tips for Small Teams vs. Large Enterprises

While both systems can be tailored for different company sizes, larger lenders using Encompass may want to invest in custom workflow engineering and compliance automation, while smaller shops using Calyx should lean on template-driven processes and prioritize staff training.

• Large enterprise tip: Assign a dedicated compliance officer to oversee LOS configuration, enforce mandatory audit drills, and liaise with technology partners for timely updates.
• Small company tip: Leverage Calyx’s support resources and training to fill in procedural gaps, and consider forming a peer review process for critical disclosures.

Stay Ready, Stay Ahead

For mortgage lenders and financial institutions, audit readiness isn’t a one-time project—it’s a living, breathing process. It’s about building habits, refining systems, and creating a culture where compliance is part of how you operate every day.

Whether you're running on Encompass, Calyx, or both, staying ahead means staying vigilant. Review your policies regularly. Keep up with software updates. And most importantly, empower your team to raise their hands when something doesn’t look right.

Ready to go beyond the basics?
Mortgage Workspace gives you a centralized, secure platform purpose-built for compliance clarity. With real-time tools, audit-friendly workflows, and a team that understands the stakes, MWS helps you stay prepared—no matter how fast the rules change. Contact MWS today for a partnership that will help you not just stay afloat, but actually excel, because “good enough” isn’t in this industry.