Loan Placement - Increase Your Pipeline with Product Knowledge

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

Processors are on the front lines when it comes to product knowledge. Obviously we cannot know everything about every guideline or how each underwriter will interpret them. But, since we are dealing with the underwriters on a daily basis, we are able to glean valuable information about what loans have the best shot at closing with a particular lender.

We add value to the LO / Processor relationship with the knowledge we retain from each and every transaction. Whether a loan closes or dies and the reason for it becomes invaluable information.

It is important to pay special attention to the details of every transaction, as the environment (especially in today’s market) is changing rapidly. For example, the lender that gave great service two months ago may have become the flavor of the month for every broker in town, as a result their service level may have gone into the tank. Since I close many loans with many different lenders who offer the same products, I can keep an eye out for which lender is maintaining the best level of service. Making these suggestions helps to maintain the best overall level of service for all parties.

Right now many processors are gasping. Did he say “suggest where to place loans???” Yes I did. “Isn’t that going to bog us down?” Not if done properly.

I am not suggesting, nor do I advocate, the processor running pre-quals or placing loans for loan officers. I am suggesting we take a team attitude and help direct traffic. Loan officers are not in the trenches with the lenders to the same degree that we are. More often than not, they do not have the first hand experience in taking a particular loan product from processing to docs. We do.

You do not need a full file to suggest where an LO might decide to start looking. Typically, when an LO is searching for a home for the loan, I receive an e-mail that goes something like this…

”Who is doing a loan for someone with a 670 mid score, 95% cash out, with a 48% DTI and 6 months worth of assets?”

I can then quickly respond…

“Lender A, Lender B, And Lender C are all candidates…but try to use lender B as their service is great, and Lender A is shredding every appraisal they see plus Lender C has horrible turn times at the moment.”

It did not take much time out of my day and may have saved the LO valuable time in digging for a lender. Your LO will appreciate this and so will your pocket book. Any time the LO can spend more time originating, it gives more potential deals for you to process.

I try not to have to use one hundred different lenders. Actually I couldn’t if I wanted to. (Are there even that many still in business????) I try to keep it to a reasonable few that I have relationships with. Ultimately, it is the LO’s or branch’s choice who they use, but I have managed to persuade my brokers to use the lenders I am the most familiar with. Every lender is different and it is beneficial to develop relationships with key lenders and their teams for specific products.

I try and have four to five choices for Fannie and Freddie loans - that way I can submit based on who has the best current service level and turn times. I try to have five or six Gov’t lenders, two to three for automated placement, a couple for nominal fallout, and one or two for the difficult manual underwrites. It is also good to have some relationships with Hard Money lenders and Subprime (Did I say that???) if you can find one.

Being able to make these suggestions will add value to your service. Next week I will talk about how to find, share, and educate your LO’s on guidelines. The more educated your LO’s are will solidify the types of loans you receive. Your branches will appreciate the info, and you will reap the rewards of more closed loans with fewer files having to be resubmitted to multiple lenders.

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.