6 min read May 09, 2024

Mortgage Processor: Who They Are and What Do They Do?

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Edited By

Megha Mulchandani

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Editor
Edited By

Megha Mulchandani

Editor, Houzeo
About

Megha M. is an adept content editor well-versed in the intricacies of American market dynamics and economic trends. In her free time, she excels as a versatile theatre artist and public speaker.

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To secure a mortgage, you will need extensive paperwork. It’s the mortgage processor who will come to your rescue. They meticulously review your personal information and financial documents.

A home loan processor collects all your paperwork and processes your loan application. They play a bridge between a loan officer and an underwriter.

If you’re planning to purchase a home, here is all the crucial information for you on a mortgage processor.

⚡Key Takeaways

  • Who Is a Mortgage Processor: A mortgage processor assembles your application documents before your loan file is reviewed and approved by the underwriter.
  • What Is Loan Processing: The process to get your mortgage approved and finalized is called mortgage loan processing.
  • Mortgage Processor Vs. Underwriter: A mortgage processor prepares your application, while an underwriter evaluates your eligibility and terms.
  • Roles and Responsibilities of a Mortgage Processor: A mortgage processor’s role is to organize, manage and handle the documentation associated with your loan.

Who Is a Mortgage Loan Processor?

A mortgage processor assembles and prepares applications and other documents before the approval of the loan underwriter. These documents include pay stubs, W-2s, and credit reports.

The loan processor works with your home loan officer to ensure you are financially eligible for the loan you choose.

Additionally, the loan processor makes sure the papers are presented to the underwriter in the required format.

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Loan Processor Vs. Loan Underwriter

A loan processor prepares your application, while an underwriter evaluates your eligibility and terms.

The mortgage underwriter examines your assets, credit score, and financial history from the processor to decide on your loan. They verify the property’s condition and check if you can afford monthly mortgage payments before approving the loan.

The underwriter also evaluates the logical appraisal value and ensures a problem-free transfer of the property’s title. Any underwriting concerns that arise are usually conveyed by the loan processor or loan officer.

Loan Officer Vs. Loan Processor

The main responsibility of a loan officer is to guide you through the lending process. Their other roles include:

  • assessing your application
  • suggesting loan programs
  • finding optimal rates and terms based on your financial profile

Depending on your collaboration with a broker or bank, the loan officer may also communicate with a loan processor.

On the other hand, loan processors compile and verify your documents using a checklist specific to lenders and loan types. The goal, however, is the same – to give a smooth closing to your mortgage application.

» Mortgage Loan Originator: Know their role

What Does a Mortgage Loan Processor Do?

Mortgage lenders hire loan processors to organize the paperwork involved in the process. For borrowers, they streamline the loan application process.

Here’s an overview of what mortgage processors do:

1. Documentation Work

A loan processor collects your financial documents and makes sure they’re accurate. These documents typically include the following:

  • Tax Returns
  • W-2
  • Gross monthly income
  • Proof of insurance
  • Bank statements
  • Evidence of assets and debts

The home loan processor double-checks the minute details such as income calculations, bank statement pages, legibility of documents, etc.

2. Getting Your Loan Request Processed

Home loan processors are an important part of the mortgage process. They help to prepare your application for underwriting and keep it on track for closing.

They also organize your documents for each loan type, which helps the underwriter make a decision quickly.

5 Key Responsibilities of a Mortgage Loan Processor

A mortgage processor simplifies the home loan process for you. Here are their key responsibilities:

1. They Collect, Review, and Verify Your Documents

A home loan processor carefully reviews your financial records during the application process. They may also reach out to essential third parties such as your employer, to verify details.

2. They Study Your Credit Report

Credit reports are an important part of mortgage applications. Loan processors will review your credit reports, and check for late payments, collections, or outdated addresses. They may also ask for clarification on any negative items on your credit report.

The processor may ask for court documents in case your credit report has unpaid child support or past bankruptcies.

» How to Buy a House With Bad Credit: Discover ways to purchase a home with a bad credit report.

3. They Collaborate With Title Companies and Appraisals

The loan processor collaborates with a title or escrow company to gather property details and verify its ownership status. They also coordinate with appraisers in their network to schedule a home appraisal for you.

4. They Keep a Time Check

Your mortgage loan processor will track the key stages of your loan application, including:

Home loan processors manage important contract dates to ensure everything is on track. They also monitor rate lock expiration dates so you don’t have to pay the date extension fee at closing.

5. They Prepare Your Loan File for Closing

Once your loan is approved, your loan processor will take care of the closing documents. They ensure you are ready for underwriting and a smooth closing process.

Bottom Line

A mortgage loan processor is a key player in the home-buying process. They gather your financial documents, review your credit report, and help you choose the right mortgage for your budget.

They also track the key stages of your mortgage, from home search to closing, and prepare the closing documents. Partnering with a home loan processor can help ensure a smooth and efficient loan process.

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FAQ’s

1. What happens during the mortgage processing?

Mortgage processing involves gathering and confirming your financial details. The loan processor arranges your documents for the underwriter, and ensures everything is complete before they send the loan file for the review.

2. How long does mortgage processing take?

The mortgage process usually takes about 30 days. It includes getting pre-approved, getting the home appraised, and getting the actual loan.

3. What does a mortgage processor do?

Mortgage processor gathers all your financial documents, reviews your credit report, prepares your loan application for the underwriter. They make sure everything is in order so your loan can get approved quickly and easily.

» What Does a Mortgage Processor Do: Discover the Key Responsibilities of a Mortgage Processor.

4. How to become a loan processor?

To become a loan processor, you have to obtain a mortgage license. For this, you need to complete the online mortgage processing training and clear the exam conducted by the National Association of Mortgage Processors (NAMP).

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