When buying a home, we know that you want as seamless a transaction as possible and that you want to avoid any horror stories. Therefore, choosing your lender is so important and an important role is that of the mortgage loan processor.
In this series about the home buying process, we've explored How To Find The Right Real Estate Agent For Your First Home Purchase and What Role Does A Mortgage Banker Play In Buying A Home? Here, we learn about the mortgage loan processor.
What does a loan processor do?
The mortgage loan processor works with many people involved in the mortgage process when you are buying a home and applying for a loan: the mortgage banker, the underwriter, the title company. In the video below, Ashley describes the loan processor as,
"...the glue for the process. You know, we work with the underwriters, the mortgage bankers, the title company, the closers. We work with the whole group that's connected to the process."
The loan processor receives all of the loan documentation, and reviews them to make sure that all of the items that need to be there are there. That way a full loan application can be presented on your behalf to the underwriter.
- The loan processor would first review all your financial documentation and get projected expenses associated with the home you're looking to buy. He/she will look at the type of mortgage and property information.
- The loan processor would then verify your information by contacting credit companies, your employer, and also get in touch with an appraiser.
- A loan processor also makes sure that all your paperwork is completed correctly before handing it off to an underwriter. It is important that a loan processor knows what the underwriter will be looking for in your application, so there are no discrepancies.
The loan processor would also discuss any concerns with the underwriter until the file is completed and approved. In the video below, Matthew explains,
"At that time the underwriter will review all of the documentation, whether it be asset or income documentation and make an initial lending decision based on that. And then at that point the underwriter will present that decision to me.... The mortgage banker and myself will reach out to the borrower, discuss whether it be approval or a suspense item or whatever the decision may be, and then we go back and forth with the underwriting department until we satisfy all of the items which the underwriter wishes to review, until we have what we call a final approval."
The underwriter will make the initial lending decision, which will be communicated to the loan processor. The loan processor will then complete a final audit to ensure everything is in order before sending your file to closing.
In terms of timing, the typical process takes about 35 to 40 days. However, when details are well organized, the processor can be completed in 25 to 30 days.
What's your experience with obtaining a loan to buy a house? How did the loan processor help you with documentation?