Mortgage Processing Overview
The mortgage processing phase involves the collection of documents and information required to verify the borrower's creditworthiness and ability to repay the mortgage.
During the processing phase, the lender will typically request a number of documents from the borrower, including:
Verification of Employment (VOE): The lender will request proof of the borrower's employment status, including salary and length of employment.
Verification of Income (VOI): The lender will request documentation of the borrower's income, such as W-2 forms, tax returns, and pay stubs.
Asset Verification: The lender will request documentation of the borrower's assets, such as bank statements and investment statements.
Property Information: The lender will obtain a copy of the sales contract and other information related to the property, such as the property appraisal report.
Property Appraisal: The lender orders an appraisal of the property to determine its market value. The appraisal helps ensure that the loan amount is not more than the value of the property.
Credit Report: The lender will obtain a credit report on the borrower to evaluate their creditworthiness and to assess the level of risk involved in lending to the borrower.
Once the lender has collected all the necessary documents, they will review and verify the information to ensure that the borrower meets the lender's underwriting standards. During this process, the lender will also check the borrower's credit history, credit score, and debt-to-income ratio.
If there are any discrepancies or missing information, the lender will contact the borrower or other parties involved in the loan process to request the necessary documentation or clarification.
Once all necessary documents are gathered and verified, the underwriting process follows, involving a thorough evaluation of the borrower's creditworthiness and property value.