Tips for Effective Mortgage Loan Processing? What are they? The Mortgage Loan Process can be an anxiety-ridden, frustrating, sometimes angry, and slow process. Waiting is not a skill in a "get it tomorrow" society. The entire mortgage lifecycle- application, authenticating, processing, underwriting, inspection, and closing demands a lot of documentation. So, securing a Mortgage Loan takes a lot of time. But if carefully planned, the entire process can be streamlined and accomplished in a fraction of the time needed to complete - if there is no organized roadmap. The result? Less frustration and anxiety. Everyone is much happier.
Why the long-drawn-out process? New regulations were coming anyway, but the sub-prime crisis, the market crash of 2008, and the rampant fraud that was discovered left regulators no choice but to change the game.
Since then, mortgage loan application rejections have soared, sometimes as much as 50%! That said, it's imperative that Mortgage Lenders and Mortgage Brokers do everything they can to make the process faster and smoother and smoother for their clients. Everyone will be happier. Make sure your want-to-be buyer knows all the steps.
Steps in the Mortgage Loan Process:
- Preapproval
- Determine the amount of an affordable monthly payment
- Find the property you want
- Make an offer
- Submit the actual loan application
- Supply the required documents
- Receive approval
- Property inspection
- Close on the property
Tips For Effective Mortgage Loan Processing
Now that we've outlined some Tips for Effective Mortgage Loan Processing in broad strokes, here's a little more detail for saving time and frustration.
Get then preapproved. No surprises after your client have found a home to buy. Know beforehand what they can afford to purchase. Always ensure they have a checklist of things to have and know before the mortgage loan process begins.
Collect the required documents. And there are a lot of them. Collect them in paper or digital form, whichever way they apply, and ensure the documents contain the info the lender will need.
If possible, reduce their debt-to-income ratio. Not only will they be able to afford a more expensive home, but the mortgage rate will likely be lower.
Make sure there are as many funds as they can manage in their bank accounts.
Make sure they're up to date on your income tax filing.
Avoid changing jobs.
Make sure they have extra money for closing costs.
Tell them you are glad they chose to work with an experienced Lender or Broker.
Improve Your Mortgage Loan Processing Structure
Know all of this? How can you do it better? Plan, Plan, Plan. Don't wait for the industry regulations to get easier or the process to get smoother. The work is here for you to do it. These may be helpful hints.
Make sure you have a checklist. That's right, just like you made in school, or what pilots do to always follow the correct procedure. Why? Because it's essential! Maybe not life and death are meaningful but important. Besides, you want the deal to work out, right?
Responsibility. Make sure that all parties know what they must do and when it needs to be completed. All the income documents: check, the bank account records check, tax records: check. And so on. Again, you might think this too basic, but it's sometimes surprising how often things fall through the cracks.
Make sure you have some hard and fast rules on which buyers are worthy of your time and a loan that will be repaid and defaulted on. Just a little bit of caution may save multiple headaches down the road. Qualification standards are observed for a reason. No matter how much you wish a client will qualify, if they don't, then say NO.
Keep the buyers posted. They won't be calling you at random hours with questions if they know you will be in touch with them tonight. Keeping a constant communication line open with them will keep things smoother for everyone.
Stay current on the technology that will make your job easier. As the mortgage process migrates to a more digital form, stay up on how to use it! Born out of necessity during the pandemic, we soon discovered what a great tool it is for any reason: less paper, less time, more accuracy, less expensive, and fewer must-have face-to-face meetings. You know the drill. Digital saves!
This is all good. Are there other tips?
Since you asked, there's a big one. Mortgage Loan Outsourcing is more and more attractive in this digital loan processing age. Today's Business Process Outsourcing service providers are light years ahead of the industry that existed 20 years ago. More professional, more knowledgeable, and with various essential skills, you might be surprised at all of the sectors outsourcing is used in. not the least of which is mortgage loan processing. Talk to an experienced, professional, highly trained firm today and see how their team can get the work done faster and for less money! Think about outsourcing the mortgage loan process.
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