A mortgage loan processor is a bridge — or a middleman — that connects the borrower, mortgage loan officer, and mortgage underwriter. Without this middleman, loan processing crumbles, causing delays and haphazard document reviews and verification as the loan officer or an in-house staff takes care of the workload. All of which are tedious and require a high level of focus and meticulousness.
By hiring or outsourcing to a loan processor, your loan officer’s day-to-day workload becomes more manageable, improving overall productivity and streamlining a borrower’s mortgage loan application. To help you make an informed decision on your next hiring venture, this article takes a deep dive into the inner workings of a mortgage loan processor. We also included a guide on how to write a mortgage loan processor job description.
Mortgage Loan Processor Vs. Loan Officer Vs. Loan Underwriter
Just as a loan mortgage application involves a lot of steps, there are also loan professionals involved in ensuring the success of one’s application. These professionals are the mortgage loan processor, loan officer, and loan underwriter. While all help loan applicants close in on their dream home, let’s learn the different roles of each one below.
1. Loan Officer
A loan officer is a loan applicant’s point of contact. Loan officers boast in-depth knowledge of student loans, mortgage loans, and the like to educate and advise applicants on the best type of loan based on their eligibility, goals, and needs.
They also help individuals get up to speed with their financial institution’s loan application process. In addition, loan officers prepare, gather, and submit all paperwork to a mortgage loan processor.
2. Mortgage Loan Processor
From income tax returns and W-2 forms to bank statements and asset statements, these documents are concrete proof of an applicant’s financial capacity to repay their mortgage. For new applicants especially, organizing everything can be overwhelming. This is where a mortgage loan processor shines.
Mortgage loan processors assist loan applicants get their paperwork in order, compiling all required documents for the loan underwriter to review. On top of reviewing credit reports, they also assist mortgage applicants in monitoring their application deadlines to avoid late fees.
3. Loan Underwriter
A loan underwriter has the final say in the loan application process. They meticulously review an applicant’s credit history, financial documents, debt-to-income (DTI) ratio, and cash flows to determine their risk level. Using an underwriting program, a loan underwriter can gauge whether a potential borrower is reliable and financially stable enough to repay their loan in due time. Otherwise, the application will be denied.
What Is the Job Description of A Mortgage Loan Processor?
Mortgage loan processors mostly handle the meticulous side of the mortgage loan application process, particularly verifying submitted documents, reviewing credit scores, and monitoring deadlines to ensure a successful closing. Here’s an in-depth look at the job responsibilities of a mortgage loan processor:
Analyzing Credit Reports
A borrower’s credit report sheds light on their financial habits. Mortgage loan processors carefully review an applicant’s history of late or missed payments and other financial information. This way, they know whether a borrower can pay their present and future dues on time. If necessary, they can request the applicant to provide a letter of explanation.
Collecting and Verifying Financial Documents
This is the primary responsibility of a mortgage loan processor. After the mortgage loan officer hands in an applicant’s financial documents, the loan processor ensures that all the necessary paperwork has been submitted.
Next, the loan processor thoroughly verifies the accuracy of the information provided in the documents, including their social security number, employment status and history, and credit score.
The mortgage processor may also contact the loan applicant to supply missing information, or request a written proof of employment verification from the borrower’s employer — if required by the underwriter.
Scheduling Home Appraisals and Title Searches
When appraising a home, the mortgage loan processor works with a professional appraiser to estimate the value of a home based on the property’s condition, size, amenities, location, and many other factors. From here, the appraiser can gauge whether the home’s value matches the loan amount. The loan processor also schedules title searches with an attorney, title company, or abstractors for ownership claims or existing outstanding issues, such as unpaid property taxes or debts.
Tracking Deadlines of Submission
From searching to appraising a home, mortgage applications follow a timeline, and it’s up to the loan processor to ensure that the borrower can close in on a home within the deadline. Hence, the mortgage loan processor communicates with the borrower on important submission dates to avoid extension fees and ensure a smooth mortgage application process.
Working With A Loan Underwriter
The mortgage loan processor and loan underwriter finalize the borrower’s mortgage application for the latter’s final approval, with both parties addressing any discrepancies, typos, or pending action items in the application.
Planning A Closing
After the mortgage loan underwriter approves the mortgage, the mortgage loan processor schedules the much-awaited closing day with a title company to verify the applicant’s required downpayment, calculate closing costs, and prepare the closing document.
What Are the Qualifications of A Mortgage Loan Processor?
Hiring a mortgage loan processor is your best decision for your financial institution. Knowing the minimum education and professional qualifications is key to ensuring your new hire has ample knowledge of loan processing.
1. Education
A high school diploma is often enough to work as a mortgage loan processor. However, for some financial institutions, a bachelor’s degree in business administration or equivalent is a plus as it prepares students for a strong finance background and makes the transition to loan processing easier.
2. Certification Programs
Certification programs are great for upskilling. They help solidify an individual’s knowledge of loan processing and regulations, improve their proficiency in using loan processing programs, and equip them with skills that enable them to tackle complex mortgage cases.
On top of a bachelor’s degree, financial institutions also see candidates who completed a certification program as an asset, increasing an applicant’s prospect of landing a loan processing job.
3. Professional License
This depends on the location. For example, in many states in the US, a license is necessary. Hence, mortgage businesses need to do their research before hiring a mortgage loan processor.
4. Work Experience
A loan processor can get work experience in banks, mortgage companies, or financial institutions, where they can learn new skills, gain first-hand experience processing mortgages, and collaborate with a mortgage loan underwriter. Entry-level loan processors can start as loan processing assistants.
What Are the Skills of A Mortgage Loan Processor?
Mortgage processors work not just with financial documents but also with people. Before writing a job description for mortgage loan processor, take note of the following soft skills your ideal candidate must possess:
Attention to Detail
Loan processing entails perusing every financial document with a fine-toothed comb. There’s no room for errors and inaccuracies, as even the simplest mistake can delay or compromise the borrower’s mortgage application.
This affects the overall reliability of the processor and the institutions’ application process. To avoid potential disruptions in mortgage applications, the loan processor must ensure that all paperwork is error-free before handing it to the mortgage loan underwriter.
Interpersonal Skills
Processing loans is not a solitary job, and social skills are a bare minimum in the mortgage industry. By establishing good professional relationships, mortgage loan processors can effectively collaborate with applicants, loan underwriters, and other stakeholders. This helps speed up a borrower’s loan application process and minimize conflicts between involved parties.
Another aspect of interpersonal skills is cultural awareness, which is handy when working with borrowers from different socio-cultural backgrounds. Because clients of various ethnicities have different consumer behaviors, mortgage loan processors must provide a culturally nuanced mortgage processing experience to establish rapport and maintain professionalism.
Time Management
Mountains of paperwork are not an excuse for missing a deadline. A reliable mortgage processor manages their time well, maintaining optimal productivity and accuracy while juggling multiple workloads so the loan application can move forward without further delay. This enables a faster closing of a new home, improving borrower satisfaction.
Tech-Savviness
Speed and efficiency are everything. The Digital Banking Reporting reported that abandoning rates skyrocket to 60% or more if applying for a loan takes over five minutes of a person’s time. When loan processors familiarize themselves with AI and automation to boost operational efficiency, they can improve their career prospects and stay competitive in the lending industry.
Mastering new or never-before-used loan processing programs is key to success, too, making open-minded, tech-savvy mortgage loan processors highly coveted by employers.
How to Write A Mortgage Loan Processor Job Description?
Your mortgage loan processor job description generally includes the objectives, key responsibilities of the role, preferred qualifications, and a list of benefits. Whether you’re outsourcing to the best Philippine BPO companies, or hiring straight from a freelance or job search platform, here’s how to write a solid mortgage loan processor job description that attracts potential candidates.
1. Perform A Job Analysis
You can’t write a mortgage loan processor job description without conducting a job analysis. This process helps HR staff identify and analyze job-related information — such as qualifications, responsibilities, and skills — to guide hiring decisions and manage employee performance.
Observe or interview your in-house mortgage loan processors. How are they performing their tasks? What is their highest educational attainment? Do your loan processors complete certification programs? You can hand out questionnaires containing questions on your loan processors’ competencies, interpersonal relationships, and many more.
After gathering information, validate your data and present your findings to the HR or upper management, so you can begin drafting a mortgage loan processor job description based on those findings.
2. Craft A Specific Job Title
A job title must encapsulate the experience level and include the country acronym and employment type to attract the right candidates. Instead of “Mortgage Loan Processor,” consider using “Full-Time Entry-Level Mortgage Loan Processor — US Mortgage Company” or “Part-Time Senior Loan Processor for AU Client.” This way, candidates with experience working for American or Australian clients can apply for the role.
3. Write the Objectives or Summary
Begin with a brief, engaging introduction of your mortgage company, highlighting its core values, mission, and vision. You can include a brief overview of the role and close this section with why a candidate should work for you. Keep this section short and sweet, around three to four sentences.
4. Establish Salary Expectations
Salary is another factor when applying for a loan processor job. However, this is a double-edged sword, as it can tempt desperate candidates to apply for the role just to earn a large paycheck without the skills and qualifications to back them up. While establishing salary expectations in a mortgage loan processor job description is debatable, it’s best to avoid overpromising and underdelivering applicants.
5. List the Qualifications and Duties of A Mortgage Loan Processor
To answer your question, “what are the duties of a mortgage loan processor,” you should look no further than the data from your job analysis. Job responsibilities should neither be too long nor too short, such that they become too vague and lack specific details. When writing the duties of a mortgage loan processor, always begin the sentence with an action word. Here are two examples:
- Organizes the candidate’s financial documents for the mortgage underwriter’s approval.
- Works and communicates with the mortgage applicant to ensure the timely submission of financial documents to meet closing deadlines.
For the qualifications, include the following details:
- Educational attainment
- Minimum work experience
- Professional license and certifications
- Software proficiency
- Soft skills
Again, be specific. Identify which skills and qualifications are non-negotiables, and which ones are bonuses. But don’t make a lengthy list of job qualifications, as adding too many can throw off candidates.
6. Include A List of Company Benefits
This is your last chance to draw in potential candidates with company benefits, including performance-based bonuses, flexible working hours, permanent WFH, and paid PTOs. No need to include all benefits, so include the ones that you think are essential for most applicants.
Hire A Filipino Mortgage Loan Processor Today
The mortgage industry is as dynamic as most industries today. This is thanks to the adoption of powerful technologies and inevitable changes in local regulations. To be successful in the industry, one must be efficient. And what better way to be efficient than outsourcing mortgage loan processing?
Outsourcing to the Philippines is not only cheaper. The country is also more culturally aligned with Western values considering the number of highly educated, English-proficient mortgage loan processors in the workforce.
At KDCI, we offer high-quality, cost-effective loan processing and other property management services. Our offshore mortgage processor team values excellence, reviewing multiple financial documents with careful precision and bolstering loan processing efficiency to help applicants close in on their new homes within the deadline.
Contact us now, and let’s help you grow your mortgage business!
