Processing At The Speed Of Light - The Assembly Line

Written By: John Hoxsey,
Certified Master Loan Processor (CMLP)

If you want to crank up the speed of your operation, increase productivity, and close the largest volume with the least amount of friction, it is time to implement an assembly line.

No good operation can flourish without clearly defined rolls and functions. Everyone must know what is expected of them and should have a working knowledge of the other team member’s functions and responsibilities.

I let my loan officers know up front what is expected of them, what they should expect from me, and what we should expect from the underwriter, closing dept, and title company.

Far too often loan officers get the impression that all they have to do is sell the loan and the processor will take care of the rest. The L.O. assumes that you will find a lender, price and lock the loan, deal with all third parties involved in the transaction, clear every condition and communicate with the borrower. Processors are not personal secretaries – they are processors.

The problem with placing the majority of the responsibilities on the processor is that it creates bottlenecks. It is like the “I Love Lucy” episode (http://www.youtube.com/watch?v=LfDXaQT3In0&feature=related) where Lucy and Ethel are working frantically trying to keep up with wrapping the chocolates as they pass by on the conveyer belt. No matter how fast they move or how creative they get there is just no way to keep up with the workload.



We need a more efficient conveyer belt with larger chunks of the work being completed at each station. Many times we receive files before they are ready to be processed and are expected to take care of the uncompleted work. When a processor receives an incomplete file it can slow down the entire system. There is nothing more frustrating than getting a file, taking the time to set it up, only to find it is lacking what constitutes a file in the first place. We then have to take the extra time to communicate what is missing to the loan officer. Once we receive the missing documentation we then need to review the file again before submitting it. In such a situation we are spending twice the amount of time and in extreme cases three times the amount of what it should take to set up a normal file.


Too much responsibility on any individual in the assembly line will create backups and stifle business. We need all parties to specialize in the task they perform and complete them with optimum efficiency.


If 16 loan officers each sent you an average of 1.5 files per month then you would have 24 loans to process. Sounds pretty easy right? Problems arise if you have to place the loan, price the loan, lock the loan, communicate with all parties including the borrower, then once you get that far start processing the loan.


When things do not flow properly loans can jam up the system. When one loan stops up the system then every loan behind it suffers and the whole assembly line can back up. When this happens and turn times get out of control we can lose valuable business. The loan officer risks loosing their loan due to someone else soliciting the borrower or missing a contract date. The processor risks loosing bonus money for each loan that does not close and if you are a contract processor you risk loosing a broker due to poor service.

On the flip side if those same 16 loan officers handed in neat, pre-qualed, locked loans ready for processing you could handle twice that volume and still maintain a great reputation!!!

I break the responsibilities down like this:


Loan Officer Responsibilities:

- Take the Loan Application and doc the client

- Order The Appraisal

- Collect All Borrower Docs

- Identify the Lender & Loan Program

- Run Automated Findings

- Keep a Copy File

- Return All Borrower Original Documentation (W-2’s, Pay-stub’s, Bank Statements, etc.)

- Register and/or lock the loan

- Turn in a package ready for processing

• Signed Disclosureso LOS or Fannie 3.2
• File Completely Filled Out
• All pertinent Income Docs
• Lender Pre-approval
• Lock or Registration
• Appraisal
• Processing Checklist Completely Filled Out

- Be the main Borrower Contact

Processor Responsibilities:

- Order VOM’s, VOR’s, VOE’s, etc.

- Order Loan Payoffs

- Review Credit Report

-Review and Calculate Income

- Review Appraisal

- Verify DU Findings / Approval Matches 1003

- Verify Disclosures are Compliant

- Submit Loan To Lender

- Clear Lender Conditions

- Contact and Order Title Services

- Clear Title Conditions

- Order Mortgagee Clause Changes

- Prepare Fee Sheet and Verify Fees with Broker / Lender

- Coordinate Closing Times and Dates

- Review HUD and Verify with Broker / Lender

- Confirm Closing was Successful

- Clear Post Closing Conditions

- Assure Everyone Gets Paid

- Return Loan Package to Broker / Lender (For Contract Processors)

- File Loan for Compliance (For In-House Processors)

Ultimately we all want the same thing - higher volume, more closings, and a system of working that does not kill us or make us crazy in the process.

When loan officers do their part up front and are held accountable to turning in full and complete files than processors can pick up the ball take it to the finish line. When we each understand the boundaries and what is expected from one another then we can rest assured we will have a smooth flowing operation and bigger paydays for everyone.

Remember - Your reputation is your business.

Happy Processing!!!

About the Writer. As one of NAMP's volunteer writers, John Hoxsey is currently a NAMP member in good standing and is a NAMP Certified Master Loan Processor (CMLP). If you would like to become a volunteer writer for NAMP, please email us at: blog@mortgageprocessor.org.