How to know your loan processor is the right one for you ?

A mortgage loan processor is the link between a borrower, loan officer and the  underwriter in the context of a residential mortgage. And he or she is arguably the most important member of the team.

The National Association of Mortgage Processors says, “The primary function of the Loan Processor is to ensure the timely and accurate packaging of all loans originated by loan officers.” So it’s mostly an administrative role.

Mortgage loan processors typically:

• Collect and collate all the information needed to approve a loan and make informed decisions concerning an application
• Input that information into the lender’s IT systems
• Verify information through documents you supply
• Make third-party checks with credit bureaus, employers, accountants and so on
• Order an appraisal of the home
• Obtain title insurance and flood insurance (if needed)
• Ensure the compliance of your case with regulatory requirements and internal policies
• Order the final loan documents
• Ensure the loan stays on track to close on time
• Schedule appointment for closing

You can usually expect a mortgage loan processor to be involved throughout the application process: from pre-approval to closing.


Advantages of a good relationship

For a loan officer, it is of immense help to have a good relationship with a mortgage processor. The processor is the person who often has some workarounds. He/She might suggest an alternative that might get you out of a hole and make the difference between a loan that closes and one that doesn't. For instance, it can be difficult proving that your client is receiving alimony if she doesn’t deposit it separately or keep copies of the checks. And who wants to have to ask their ex for cancelled checks?

A processor may find a way around this, ordering copies of the actual deposits from your bank. So you need him on your side. The last thing you want is to be deliberately unhelpful or gratuitously rude.

In fact, building a good working relationship with her can help you. You want her to see you as a person rather than a case number each time she picks up your file. Even the most objective professionals work harder for those they like. As far as possible, it helps to respond to requests from processors in a timely manner - to show that you care about the work that he/she is doing for you.

Is FHA Home Loan a good option for me?

Is FHA Home Loan a good option for me?

FHA, which stands for the Federal Housing Administration, is a United States government agency which insures home loans for FHA approved lenders.

One of the best tips for buying a house is to fully understand all the financing options that are available to them.  As a buyer is trying to determine which type of mortgage is the best, they must weigh the PROs and CONs of each option.

In this article you’re going to learn what the PROs and CONs of FHA home loans are., a buyer puts themselves in a much better position to make a smart decision when it comes to their home financing.

What Are FHA Home Loans?

FHA has been helping people become homeowners since 1934.  FHA is part of the HUD, which stands for Housing and Urban Development. One of the biggest reasons why FHA home loans are popular nowadays is because they allow buyers who don’t have boatloads of money saved for a down payment to still buy a home.

How To Determine If You Qualify For FHA Home Loans

It’s critical to understand when obtaining financing for a home that there are general guidelines a lender follows, also referred to as mortgage overlays, but there is certainly flexibility depending on a buyers individual circumstances.

Below are some general mortgage overlays that lenders will use to determine a buyers eligibility for an FHA mortgage.  

• Lenders prefer to see a minimum credit score of 620, however, FHA does allow a buyer with a 580 credit score to qualify for a home loan, subject to other requirements.
• FHA home loans require a minimum of a 3.5% down payment.
• Lenders prefer to see a buyer with a debt-to-income ratio of 43% or less.  In some cases, FHA allows a buyer to be manually approved with a debt-to-income ratio as high as 55%.  Buyers with debt-to-income ratios higher than 43% can be approved through the AUS (automated underwriting system).

These guidelines above are very basic.  

Peoples Processing is licenced in multiple states that conducts wholesale and correspondent business. It helps brokers with the loan processing with our experienced team and help them close it faster.

Mortgage application volume rebounds but refis fall to 18-year low

Mortgage applications rose due to year-over-year progress in the job market, snapping a two-week skid. It was a 2.5% increase from the week prior, according to the Mortgage Bankers Association.
The purchase application volume drove the overall numbers. The seasonally adjusted purchase index increased by 7% from one week earlier, however, it decreased by 15% on an unadjusted basis. It stands at 8% higher year-over-year.
Despite the total applications rising, the refinance index decreased 4% for the week ending July 6 from the previous week. That is the lowest level of activity since December 2000. The refinance share of application activity went to 34.8% from 37.2%, the lowest since August 2008.
"The strong job market continues to bolster demand for homes, with purchase volume up 8% year-over-year, even as the lack of inventory still is holding back the pace of sales. Nevertheless, the mix of business continues to move towards loans for home purchase," said MBA Chief Economist Mike Fratantoni.

Employers added 213,000 jobs in June, while the unemployment rate also increased to 4% as more unemployed people resumed looking for jobs. If hiring increases continue, that could translate to more house hunters in the real estate market.
Adjustable-rate loan activity decreased to 6.3% from 6.7% of total applications.
The share of applications for Federal Housing Administration-guaranteed loans decreased to 10% from 10.2%, Veterans Affairs-guaranteed loans jumped to 11.3% from 10.7% and U.S. Department of Agriculture/Rural Development remained unchanged at 0.8%.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 4.76% from 4.79%. The average for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) also dropped, going to 4.68% from 4.71%.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.80% from 4.78%. The average for 15-year fixed-rate mortgages dipped to 4.18% from 4.22%.

The average contract interest rate for 5/1 ARMs reached its historical high point of 4.13%, gaining 10 basis points from last week. The MBA began tracking 5/1 ARMs interest rates in January 2011.

VA Program Guidelines Update

The President of the United States signed into law the Economic Growth, Regulatory Relief, and Consumer Protection Act. The Act prohibits Ginnie Mae from guaranteeing securities issued on or after May 24, 2018, if such securities are backed by a refinance loan that is guaranteed under the United States Department of Veteran Affairs benefit program and that does not meet the condition provided in the Act. 

To qualify for inclusion in a Ginnie Mae guaranteed MBS, the Act requires VA refinance loans to have a note date that is on or after, the later of:

1. the date that is 210 days after the date on which the first monthly payment is made on the mortgage being refinanced, or

2. the date on which six (6) full monthly payments have been made on the mortgage being refinanced. 

Effective immediately, VA refinance transactions must meet the revised seasoning requirements in order to be eligible for funding/purchase. Plaza's VA Program Guidelines have been updated to align with Ginnie Mae requirements. 

Additionally, for applications taken on or after May 25, 2018 VA IRRRLs must provide a net tangible benefit as described in VA Circular 26-18-13 and all fees and incurred costs referenced in the circular, shall be recouped by the veteran within 36 months after the loan closes. The recoupment calculation is the result of lower monthly payments of the refinanced loan.

Recruiting the Best Requires Commitment

Top originators want companies to keep their promises and to reward good work

Turnover in the mortgage industry is high, which leads to a variety of issues for both the employer and mortgage originators. Whether you are working for a large national or international bank or a small local

 mort-gage company, people and relationships are vital to business success, which means a high turnover rate can be a drag on growth.

If the mortgage industry wants to stem rampant turnover and continue to expand, change must first come at the company level. In this current climate, especially as recruiting efforts are at an all-time high with a strong focus on attracting young originators from the ranks of the millennials, a seismic shift needs to happen to respond to the changing expectations of employees.

The mortgage industry is a behemoth, with U.S. home mortgage debt totaling in excess of $10 trillion. Competition for borrowers and talent alike is fierce, however. Determining what really works when it comes to attracting and retaining top talent, then, is a challenge that must be met, if a mortgage company hopes to compete effectively.

Don’t disappoint

The performance of a mortgage company’s loan originators is often a main determining factor of whether borrowers will come back to the company again and again for their borrowing needs. Consequently, recruiting top originators is a goal everyone in the industry is focused on.

The common recruitment techniques normally involve promising originators big checks, written up-front, with the objective of getting those originators to move their business to the mortgage company doing the recruiting. Along with that big check normally come promises of better back-end service and career-growth opportunities.

Nearly everyone recruiting originators says the same things, and it all sounds fantastic. So, why is there so much turnover? The problem is that even though the same promises are echoed by many companies in the recruiting phase, in a lot of instances, those promises are never kept after a hire is made.

Some originators, for example, move their entire book of business and staff to a new company based on promises of greater marketing assistance and support only to find that they are given the same set of tools every other

mortgage originator has at their disposal, and then they are expected to achieve within that limited framework.

To go from autonomy and a position of respect for being a top producer in one shop to being forced into a system where you became just another number doesn’t feel right and, ultimately, that disappointment leads to more turnover. From existing top performers to lower-producing originators that still show great potential, if mortgage companies hope to attract and retain that talent, it is important for them to understand what creates the ideal work environment for originators.

Create a plan

There must be a better way to attract and retain talented mortgage originators. Part of finding that path involves thinking outside the box at times. Sometimes you need to zag when everyone else zigs. The goal should be to develop a program that ensures everyone wins.

When you achieve that goal, success is the natural outcome. This creative mindset should be applied to creating programs that incentivize originators who aren’t normally satisfied with sim-ply plugging into the daily grind of the status quo.

Create a plan to ensure that your originators’ hard work and enduring commitment to get better and grow the business is properly acknowledged. Why? Because true success comes from not only providing employees what they need today, but also in helping them to plan and secure a better future for themselves and their families.

So, when it comes to recruiting and retention, does your compensation model feel the same as those offered by other regional mortgage companies, national players or big banks? If so, it might be time to think about the pro-cess more organically. An exercise that can be helpful is to think of the perfect company — one in which mortgage originators are happy and want to stay. That involves more than compensation. You also are selling a culture.

Build loyalty

With the right formula in place for recruiting and retaining productive mortgage originators, the company will make more money and its market share will grow, fueled by the goodwill that is generated in workplaces where employees feel valued and recognized.

It’s important to put incentives in place to show that the company’s employees are the No. 1 priority, and not just numbers in a system. In order to operate at maximum productivity, employees must not only feel valued today, but also have the peace of mind to know that their company is commit-ted to them and their careers over the long term — and is willing to reward them over time for their performance.

Think about setting up programs to reward originators who meet mini-mum production standards for annual loan production, for example, or per-haps establish a program that is based on loan quality. Loyalty works both ways, and the results of such reward incentives will be readily apparent in the ongoing commitment demonstrated by originators who feel valued and supported. This paradigm shift will promote the retention of top talent by changing the way your originators look at their careers.

Whatever recruiting and retention pro-gram you set up to attract top originators, the most important factor is that the benefits promised must be delivered, so they are not seen as a carrot dangling in the air, just out of reach. Everyone must win.

Source: http://www.sg-resdigital.com/resdigital/201806re?pg=75#pg75