Role Of Mortgage Processor During The Mortgage Process
This Article Is About What Is The Role Of Mortgage Processor During The Mortgage Process
The mortgage processor plays one of the most important roles during the mortgage process.
- It is because of the mortgage processor that a home mortgage has no stress and closes on time
- The mortgage processor is the person who quarterbacks the borrower’s file to get it to the finish line
- It is the role of the mortgage processor to make sure the paperwork and documents submitted by the loan officer is complete
- The mortgage processor realizes that underwriters will kick back a file if the file has documents that are not legible and/or has missing pages
- One of the main reasons for delays in the mortgage process and delays in closings is due to underwriters kicking back the file back to processing due to incomplete documents
- A good experienced seasoned mortgage processor will not submit a file to underwriting without a complete clean package with no missing documents
- An experienced veteran mortgage processor will make sure all pages are legible and fully complete and will label each document to make the underwriter’s job as easy and smooth as possible
- Mortgage underwriters know and recognized great processors and normally underwrite their files first
The mortgage processor will take the file from the time the file is submitted, oversea the underwriting process, gather conditions after the conditional loan approval, submit the file for a clear to close, oversea the closing docs, coordinate the closing with the title company, make sure the mortgage docs gets sent to the tile company, make sure the wire gets sent out, and oversea the home closing to make sure everything runs smoothly.
Documents Required For Mortgage Processors To Start The Mortgage Approval Process
Prior to issuing a pre-approval, mortgage loan originator will request documents such as the following:
- two years tax returns
- two year’s W-2s
- recent pay check stubs
- 60 days bank statements
- letters of explanations
- other basic documents in order for him to qualify and pre-approve home buyers for mortgage
Other paperwork and/or documents that may be required depends on the borrower’s credit profile.
- Borrowers who had prior bankruptcies, foreclosure, deed in lieu of foreclosure, short sale, divorce, or other extenuating circumstances need to provide proper documentations
- Letters of explanations (LOX) will be asked frequently
- However, at Gustan Cho Associates, the loan officer will assist borrowers when writing letters of explanations
- Letter of explanations only need to be one or two sentences and nothing too long
The loan officer should not be submitting a borrower’s file to processing until they have collected all of the documents and have thoroughly reviewed the loan application, documents, credit report, and other paperwork.
Preparing Borrower’s File And Getting It Ready For Processing And Underwriting
The mortgage processor will thorough review the documents that has been submitted.
- The processor will check the documents has no missing pages and are complete and are legible
- If there are missing pages and/or are not legible, the processor will notify the borrower
- The processor will create a file that is organized, labeled, and easy for the mortgage underwriter to analyze and process so the outcome will be a conditional loan approval with as little conditions as possible
- Experienced seasoned processors will also double check the borrower’s credit report and make sure there are no credit disputes on non-medical collections and/or other derogatory credit tradelines
- Experienced processors will kick back the file to the loan officer if they see the loan officer if the application is not complete and/or if there are missing documents
In this article, we will cover and discuss the Role Of Mortgage Processor During Mortgage Process.
Automated Underwriting System
Once the loan officer reviews the mortgage loan application and credit report, the loan officer will run the file through Automated Underwriting System for an automated approval.
- The automated underwriting system (AUS) is a sophisticated highly technologically advanced computer system
- Loan officers will enter the borrowers completed 1003 mortgage loan application and credit report
- Within seconds the automated underwriting system will render an automated decision
Loan Officers should issue a pre-approval letter until they get an approve/eligible per automated underwriting system.
- Every lender has their own system in issuing a pre-approval
- All pre-approvals at Gustan Cho Associates Mortgage Group are fully qualified and have an approve/eligible per automated underwriting system (AUS)
- Loan Officers need to be extra cautious when issuing pre-approval letter on VA and FHA manual underwriting files
- Files that are very tricky should be underwriting first and then issued a pre-approval letter
- TBD PROPERTY UNDERWRITING APPROVAL are files that has been underwritten first and issued pre-approvals by a mortgage underwriter
There is no reason why a pre-approved borrower should stress during the mortgage process and the file should not close if the loan officer has properly qualified the borrower prior to issuing the pre-approval.
What Is Role Of Mortgage Processor During Home Buying Stage
Loan Officers are allowed to issue pre-qualification after reviewing the following:
- Mortgage Loan Application
- Credit Report
- Credit Scores
The loan officer should interview borrowers and make sure there are no judgments, tax liens, or other public records they are aware of but is not on their credit report. All lenders will run a national third-party public records search.
Important Documents That Are Gathered And Reviewed By Mortgage Processors
Loan officers will request documents and paperwork that is necessary to start the mortgage approval process.
Borrowers financials such as the following:
- two years tax returns
- two years W-2s
- most recent paycheck stubs
- 60 days of bank statements
- investment accounts
- other asset accounts
- divorce decree if applicable
- bankruptcy paperwork if applicable
- foreclosure paperwork if applicable
- child support paperwork if applicable
- other documents
- Once these documents are gathered, it gets assigned to a mortgage processor
- Role Of Mortgage Processor is to prep all documents in order and make sure there is no pages missing to submit to underwriting for a pre-approval
- The role of mortgage processor and loan processing is the gathering and packaging of all paperwork submitted by borrowers in a timely manner
Role Of Mortgage Processor is to make sure everything is in order. The mortgage processor will get it prepped up to be submitted to the underwriting department for a conditional approval with as little conditions as possible.
What Is The Role Of Mortgage Processor After Conditional Loan Approval
The main role of mortgage processor is to make sure that all documents submitted by mortgage loan originator on behalf of borrowers is as complete as possible. The Role Of Mortgage Processor is to get the mortgage loan package submitted to a mortgage underwriter for a pre-approval.
- The mortgage processor makes sure that all documents submitted is complete
For example, if the mortgage loan applicant submits 60 days of bank statements, the mortgage processor will review the following:
- that there are no pages missing
- review the bank statements to make sure there are no overdrafts
- review there are sufficient funds for cash to close
- Mortgage lenders can deny a mortgage application if borrowers had overdrafts in the past 60 days
- A mortgage processor that submits bank statements without reviewing it for overdrafts will most likely get a denial by the mortgage underwriter
- Role of mortgage processor is if they notice an overdraft or overdrafts in bank statements, they will notify the mortgage loan originator
The mortgage loan originator will deal with the overdraft issue with borrowers.
Gathering Mortgage Documents
The role of mortgage processor includes gathering all documentation and taking each mortgage application from the pre-qualification through the closing stage.
- The mortgage processor will itemize the conditions once borrowers get a conditional approval
- Input the conditions into the system until clearance and clear to close
The role of mortgage processor is also to verify all documents submitted such as the following:
- credit reports
- other tasks related to getting the mortgage file to the closing table
The Closing Disclosure
The role of mortgage processor is also to prepare the Closing Disclosure (CD):
- Get the final CD approved by the end mortgage lender and/or investor
- Coordinate the preparation of the mortgage loan documents
- Make sure it gets to the title company in a timely manner
- The role of mortgage processor is to be the quarterback between the title company and end lender and/or investor and make sure that the mortgage loan closes
Role Of Mortgage Processor: Prepping Mortgage Application Prior To Submitting To Underwriting
The mortgage processor, also known as the mortgage loan processor, is an extremely important person who has one of the most important roles in the mortgage approval process.
- A sloppy, incompetent, or inexperienced mortgage processor is the reason why mortgage loans do not close on time
- If the loan application is not processed correctly the first time around and gets submitted to the mortgage underwriter, the underwriter will kick it back and the process starts all over again
- A professional competent mortgage processor’s main goal is not to get any conditions back after submitting it to underwriting
- Conditional approval is a mortgage approval with conditions that need to be provided in order for a clear to close
- A good professional mortgage processor should get back no more than 5 conditions on conditional approval by the underwriter
- I have seen 30 or more conditions come back sometimes with conditional approval from a mortgage underwriter
- Some mortgage processors will not submit a mortgage application package to the underwriter until they have received every single line item that is required
Some mortgage processors will not submit a mortgage application package to underwriting even if there is a missing blank page on bank statements. If a mortgage processor is being super picky, she is doing a great job. I rather have a mortgage processor be super knit picky than a mortgage underwriter.