How to Process Mortgage Loans
A mortgage processor processes mortgage loan application files. The processor must learn all guidelines for all loan programs offered by the lender. When processing mortgage loans, it is mandatory to have mortgage processing software. Most mortgage companies use Point, Compass or LoanAce. These software programs differ, but all serve the same function and offer the same forms. LoanAce offers free mortgage processing software on its company website.
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Instructions
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Set Up Loan File
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Obtain the borrower loan file from the loan officer. In the loan file is the standard residential loan application, also known as a 1003, and various disclosures. The loan officer most likely has collected proof of income and other supporting documents for the borrower. Additionally, the loan officer has already pulled a credit report, quoted the borrower an interest rate and fit the borrower to a loan program and lender.
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Enter data. Open your processing software and create a new loan. Enter all of the information contained in the loan application into the new loan. Enter it exactly as it appears on the loan application. When approaching the liabilities section, obtain the credit report from the loan file. Enter the debts exactly as they appear on the credit report. Some software systems are set up to where you can import the information directly from the credit agency. When entering the liabilities section, check the lender;s guidelines and follow their procedures. Each lender will have different guidelines for each of its loan programs. It is essential that the mortgage processor be familiar with these.
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Check for errors when entering all of the information from the borrower's application. For instance, all asset accounts must list a name, address, account number and balance. If any part of the loan application is incomplete, send it back to the loan officer for the borrower to complete. Do not under any circumstances fill in information yourself. Make sure the loan application is properly signed and dated by both the borrower and loan officer.
Prepare and Print Documents
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Prepare disclosures. Access the disclosures section in your software program. All of the borrower's information should be automatically entered. Review the disclosures to make sure everything is correct, such as the interest rate, closing costs, and loan program. Print all applicable disclosures on legal-size paper. The disclosures must be mailed to the borrower within three business days of the borrower signing the application. This is the law for several of these disclosures.
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Prepare verifications. Go to the verifications section in your software program. These will also be pre-filled with your borrowers information. Print the following disclosures on legal size paper, if applicable:
Verification of Deposit
Verification of Employment
Verification of Loan
Verification of Rent
Verification of MortgageMail the verifications to the company that holds the asset, mortgage, rental contract or account. Obtain the name and address of the company from the borrower's loan application or credit report.
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Request third-party services. Go to the request forms section of your software program and access the request title form. Fill in your title company's information. Order the title work by faxing it over to your title company. Next, access the request appraisal form. Before filling in the appraiser's name and address, place phone calls to any appraisers you use and ask what their schedule is. Choosing the appraiser that can fit the appraisal in quickly results in quicker processing. Fax your request to the appraiser. Next, access the request insurance form. Verify with the loan officer which company the borrowers intends to use for homeowners insurance. Fill in this information and fax it to the insurance company.
Final Steps
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Mail loan documents. Place signature sticky tabs on signature lines for the borrower on the loan application and disclosures. Next, mail all documents along with one copy for the borrowers, stamped "copy" to the borrower, and include a return envelope. Mail to the borrower.
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Receive loan documents. Once you have received the signed documents from the borrower and all verifications, title work, and appraisal (which is reviewed by the loan officer), you have a full loan file and it is now ready for underwriting.
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Prepare final loan file. Access the Underwriting and Transmittal Summary in your loan software, print it on legal-size paper and place in the front of the file. You should have a copy of the lender's stacking order. Fill out the stacking order form with the borrower's information. Next, begin to two-hole punch the top of each paper. Two-hole punch the file as well. Fasten two fasteners to the inside and begin inserting the documents into the file in the lender's stacking order.
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Submit file. Depending on the loan officer's preference, you will either submit the file to the lender for underwriting or to the loan officer for review.
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