Mortgage loan processing is the process of collecting and verifying your personal financial information before sending it to underwriting. The purpose of loan processing is to make sure that all the essential documents are ready beforehand. This is done to find out discrepancies and collect additional information as support for your documentation. This helps in organizing the applicant’s file. This is a very important part of your mortgage application because it helps identify your current financial obligations to ensure that you will be able to handle the new debt.
What does a Mortgage loan processor do?
A mortgage loan processor acts as a link between the borrower, the loan officer and the underwriter. He/she is essentially the most important part of the team.
The primary role of mortgage loan processors is to take your application and save you from filling out forms. They collect and organize all the information on your behalf. From opening escrows and appraisals to pulling credit reports and verifying your income, they do it all. They submit your application package and follow requests from the underwriter.
What happens during loan processing?
There are basically three steps in processing.
- Documentation and verification
- Home inspection
- Home appraisal
Documentation and verification
The process of documentation involves verbal documentation, verification of income and verification of deposit form signed by your bank.
Home inspection
Home inspection or on-site evaluation is the process of home visit by a licensed inspector. They check the performance of the various areas of the home, primarily the interior features of the home.
Home appraisal
Home appraisal is the process by which an expert gives an unbiased assessment of the market value of your home on the basis of square footage, number of bedrooms and bathrooms and the current condition of the home to a nearby home.
How long is a mortgage loan in processing?
The loan processing period for most lenders is approximately 30 days. However, it depends from lender to lender. When compared to banks and credit unions, they take less time.
What is the difference between loan processors and underwriters?
Mortgage loan processors and underwriters have similar roles. They play crucial roles in the evaluation and approval of loans. The loan processor reviews the application and checks the accuracy and completeness of the documents. A loan underwriter checks the information on the loan application and matches it against the lending standards of the lender organization.
How long does underwriting take?
Mortgage lenders verify your assets and check your credit scores and tax details before offering a home loan. This process is known as underwriting. It takes as little as two to three days.