A mortgage processor serves as an important function in the process of evaluating your loan, but you may be wondering exactly what they do. We will discuss what a mortgage processor is, explain their role and responsibilities, and why they matter in the homebuying mortgage loan process.
What Are Mortgage Processors And Why Are They Important?
Once a loan is originated by the mortgage broker or loan officer, the paperwork is sent along to a mortgage processor. A mortgage processor reviews loan applications before sending them to the underwriter for approval. The processor typically contacts the borrower if any information is missing or if more information or documentation is required.
Here is a summary of what a mortgage processor does:
- Processors assist brokers and loan officers.
- They compile important paperwork.
- They look for any red flags or missing information before submitting the loan file to the underwriter.
For this reason, they play a critical role in the loan approval process, as any mistakes could be caught and corrected before the file is sent to an underwriter.
What Are The Responsibilities of a Mortgage Processor?
A mortgage processor’s role involves working with the loan officer, the underwriter and the closer. The processor is the one who orders the home appraisal and title insurance and confirms employment information.
- The loan processor would first review all your financial documentation and get projected expenses associated with the home you’re looking to buy.
- 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. They double-check everything like debt-to-income ratios and employment information to ensure the file will be approved.
Mortgage processors also order tax transcripts from the IRS, verify Social Security numbers and review the borrower’s homeowners’ insurance policy to make sure there’s adequate coverage.
Assuming the loan is approved, the processor will receive a list of prior-to-document conditions (PTDs) that must be met before loan documents are released by the bank.
The typical process takes about 35 to 40 days. However, at the earliest, the processor can be completed in 25 to 30 days.
Processor vs. Underwriter
While a mortgage processor makes sure your application, and documents are all accounted for, mortgage underwriters are responsible for determining whether you meet the guidelines for the mortgage loan you’ve requested.
This is the part where banks and lenders measure the risk of loaning money to a certain borrower, and to determine if that risk is acceptable.
Mortgage underwriters analyze your assets, credit, and income to demonstrate your ability to repay the loan you’re trying to borrow. They also ensure that the home is in good condition, the home value is correct and the property’s title can be transferred without any issues.