What Does a Loan Processor Does?

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Loan Processors are one of the most important individuals in the loan industry. Due to their importance, loan processors are continuously growing in number. Job outlook: fair Although loan processors are not unionized, they generally get favorable reviews from clients for being professional and punctual in their job duties. Most client referrals come from loan processors. Job opportunities are not limited to processing loans but they also help organize and run loan processing offices.

A good loan processor, also called a loan analyst or loan clerk, gathers, analyzes and completes financial information needed to carry out the loan processing procedure before submission to the title company. Most loan processors obtain their start at other positions in the company and once qualified are usually promoted to the position once receiving in-house specialized training. Loan processors must have excellent typing skills, good mathematical ability, a pleasant, professional and friendly personality and the capability to communicate in an understandable manner with any of the clientele.

Loan Processors need to have a high school diploma and be over eighteen years of age. Some Lenders require a legal permit. Loan processors who become loan officers can choose to work directly with a lender or they may choose to become an independent broker. Loan brokers deal with different lenders on behalf of a client.

Brokers are the first contacts a client makes when applying for a loan. A good broker should have a bachelor's degree and extensive work experience. Loan processors with a bachelor's degree are preferred over those without a degree. However, an experienced broker with a bachelor's degree might earn a higher salary than one who has no bachelor's degree. Loan brokers with a master's degree earn more than those with a bachelor's degree.

Loan processors with extensive work experience have better organizational skills. A graduate with a bachelor's degree is usually well-versed in organizational skills and can be a valuable asset to any organization. However, a graduate with a master's degree is a better investment because a graduate is usually knowledgeable about finance, accounting and loan processing and has been exposed to challenging and demanding real world scenarios. For example, loan processors who have worked at major financial institutions might be better qualified to handle the complex nature of loan paperwork.

Some Lenders hire only underwriters and not loan processors. Underwriters review loan applications. The best loan processors work closely with underwriters and can give them feedback about the borrower's ability to repay the loan. A good underwriter knows that a high score on a credit report is important to investors. Therefore, many underwriters have loan processors working for them.

Loan brokers may not be directly employed by a lender. The brokering service will bring the loan processors into the lender's office to meet with the underwriters. Most loan processors work as independent agents, helping a lender makes its decisions about which loans to approve and which to decline.

Loan brokers are an asset to mortgage lenders because they have better direct access to underwriters and loan processors than most local brokers have. The brokering service represents both the mortgage lender and the underwriter; therefore, they have better coordination and greater visibility than the local broker does. The biggest benefit to using a mortgage broker is that the services are usually free or very inexpensive. Brokers do not collect up front fees from borrowers. However, the fees can start to add up if several loan officers are working on a single file.

Loan processors are responsible for doing the legwork involved in sorting through all of the borrower's paperwork to find out what the borrower's current financial situation is. Some loan processors are also responsible for preparing the borrower's application for submission to the underwriting department. If a homeowner has trouble affording his or her mortgage payments, a mortgage underwriter will often use a loan processor to prepare the borrower's paperwork.

Loan processors generally spend the better part of two days processing a mortgage application. Once that paperwork is ready to be submitted to the underwriters, the mortgage processors will submit the completed forms and information to the underwriters. Loan officers will review the application and make their decisions. When the time comes for the loans to be approved, the process will be repeated until all loan applications have been approved. As with most employment positions, good performance is required. Lenders look at loan processors and underwriters on a whole-time basis.

Loan processors and underwriters can expect to work in many different offices. However, the majority of processors begin their careers working at loan officers' offices. A few mortgage brokers begin their careers as loan processors and underwriters. To become a loan processor or an underwriter, a person needs to have completed a bachelor's degree, have worked in the field for five years, and have at least three years of mortgage experience.