Mortgage Loan Processing - Who Performs This Process And How?

Published: 15th June 2012
Views: N/A

Mortgage loan processing is an activity that any person who wants to buy a house has to go through. Buying a home is among the biggest investments that people do in their lifetime. Besides a mortgage is a loan that has to be refunded year after year. The longest loan takes up to thirty years. As a result, the initial stages of processing this loan have to be done perfectly since they determine the future. The procedure is quite difficult for both lenders and borrowers.

This is why mortgage loan processing companies are asked to intervene. They make sure that various lending institutions are able to handle their loan applications every day. These loan processors work with mortgage lenders, brokers, loan officers, banks, credit unions and other related organizations. Their goal is to make processing of loans a big success on behalf of the above-mentioned organizations. Some of these organizations receive numerous loan applicants each day making it hard for them to attend to each applicant’s needs quickly and efficiently.

When mortgage loan processing service providers come in the problem is quickly eliminated. They are an advantage to the lending institutions because they handle the most complex phases of home buying. The lenders therefore get an opportunity to market their products more vigorously knowing that they have a cheaper and quicker way to process applications. These loan processers are completely involved in the three main steps of home buying including application, processing and closing.

They work closely with loan officers in the application stage to get documents from every applicant who wants to borrow money for buying a house. These documents includes current pay slips, bank statements, a copy of tax returns on commission or bonus incomes, a credit report and so on. The documentation required mostly depends on the type of a home loan one wants to take out. In the same stage, the mortgage loan processing team helps applicants choose the type of an interest rate they prefer. They may chose to lock in an interest rate that would remain fixed until the whole procedure is over or to float an interest rate.

Floating is a strategy used when an applicant predicts that the current rate would go down before the mortgage loan processing is over. In addition, the processor works with the lender to help an applicant get a Good Faith Estimate within 3 days of submitting an application form. This document represents an estimate of the costs the entire procedure is likely to cost a home buyer at closing stage. In the second mortgage loan processing stage the processing experts, on behalf of the lender, require each applicant to pay an upfront fee.

It includes the cost of verifying a credit report and other documents to determine a client’s creditworthiness, market value of a home and income levels. The last mortgage loan processing stage is closing. In the place of a lender a processor brings the loan application procedure to an end. This only happens after the lender decides in the client’s favor. On behalf of the lender the processor goes ahead to confirm the actual loan closing date. It makes sure that this date is set right ahead of the maturity of any lock in interest rate or any other loan agreement.

Mortgage Loan Processors helps mortgage brokers and bankers cut costs. There are many Commerical Mortgage Processing Services that cater to Mortgage Brokers and Lenders nationwide with a structured process to ensure success.

Report this article Ask About This Article

More to Explore