The multitude of variables and changing industry guidelines in the processing of mortgage loans usually cause undesirable delays for both the lender and the borrower. For lenders, delayed mortgage processing mostly leads to higher expenses and greater efforts. Hence, an efficient and accurate mortgage loan process through careful planning and efficient workflows is always a priority. The good news is that loan processors can inject efficiency into their operations by strictly adhering to the following thumb rules. These would empower them to evaluate prospects accurately and complete the processing while saving on time, efforts, and operating costs.
The detailed process starts with a meticulous evaluation of the loan file. It’s the loan processor’s responsibility to mindfully check the documents to evaluate if the customer is worthy of the loan amount they have applied for. They should ensure that the customer has furnished all supporting documents and check if they have any pre-approved loan in their name.
The loan processor should partially rely on the credit report of the client and gather the necessary documents required for processing the file. All assets and liabilities of the client must be taken into account, and they must furnish a written application for all late payments. Since complete paperwork are necessary for a successful filing, the processors should compile it accurately.
A rough estimation of the borrower’s income is a mistake that may lead to future problems. Hence, rather than a ballpark figure, the processor must calculate the applicant’s exact income based on their documentation, pay stubs, income tax returns, bank statements, and others. For a smooth mortgage loan process, information of all sources of the borrower’s income and liabilities should be arranged in one place.
Employment verification is done to calculate the likelihood that the applicant would repay the loan. Most loan processors rely on verbal conversations for a quick check of the applicants’ employment details. However, it’s not uncommon for them to opt for employment details via emails or other digital forms. For self-employed individuals, the processors may ask for the Internal Revenue Service (IRS) Form 4506-T and even an attestation by a certified public accountant (CPA) to confirm the applicant’s income. Regardless of the method followed, the processor must ensure accurate employment verification of the loan applicant.
The processors’ critical role in the lending process makes it imperative for lenders to work with an experienced and competent mortgage loan processing services provider for optimum outcomes.
For a hassle-free mortgage loan processing, the loan processor assumes the responsibility of gathering all relevant information about the borrower and the property. They are responsible for ordering the credit report, verifying employment details, ordering property inspection and appraisal, and title search to make it easy for the underwriters to proceed with the next phase of the loan process.