PROCESSING POLICIES & PROCEDURES FY 2016 Movement Mortgage, LLC s Manual This policy was last revised on May 18, 2016.
Table of Contents Section 100 The Role of a Processor...3 Section 200 Overview of the Loan Process...5 Section 201 Not Ready Status...5 Section 202 Loan Committee Recommendations...6 Section 203 The Loan Process: A Visual...6 Section 300 Processing Procedures...8 Section 301 The First 24 Hours...8 Section 302 Welcome Emails...8 Section 302.1 Initiating Emails to Borrowers... 8 Section 302.2 Email Template... 9 Section 303 Additional Procedures... 10 Section 400 Managing the Pipeline... 12 Section 401 Projected Closing Report... 12 Section 500 Clear to Close... 16 1
SECTION 100: THE ROLE OF A PROCESSOR 2
Section 100 The Role of a Processor At a high level, loan processors are responsible for gathering and analyzing borrower information in order to verify loan application data and work toward obtaining final approval on loan files. Working in conjunction with other employees and departments, processors ensure that all Movement Mortgage, LLC (hereafter Movement Mortgage) loans are being processed in a timely and efficient manner. The ultimate goal at Movement Mortgage is to provide our loan officers, borrower and real estate agents with exceptional customer service. 3
SECTION 200: OVERVIEW OF THE LOAN PROCESS 4
Section 200 Overview of the Loan Process As part of the unique Movement Mortgage model, we underwrite loans up front, which differs from the conventional home lending process. Once a loan is submitted, Quality Control (QC) will access some of the files at random and begin an initial review. QC places the initial orders for transcripts, the title, etc. and sorts the package into the appropriate folders in the imaging section of PCL. The underwriter begins their upfront review once QC is finished and makes one of three possible decisions. 1. Approved with Conditions 2. Not Ready 3. Loan Committee The goal is to have the loan out of underwriting within six hours. After underwriting completes its upfront review, the loan officer receives an email notifying them of the underwriting decision and the Target Processing Date (TPD). The file is then moved to the processor, who is responsible for gathering and accurately analyzing all of the information requested by the underwriter for the purpose of obtaining final approval for the loan file. As part of the information gathering, the processor will complete the following tasks, as appropriate: Gather and review income documentation Obtain all required Verifications of Employment Update 1003 information Check that the balances in PCL match documentation related to assets (used for funds to close or reserves) Verify the date of the credit report (Note: All credit reports must be obtained by MM and include our company information. Credit reports from other mortgage companies are not acceptable.) Note any differences in data between the initial 1003 and final 1003 (signed at closing) and update in PCL. Order the preliminary title report. Review the title policy. Review the HOI policy/coverage to ensure it is sufficient. Run and verify Desktop Underwriter By the time the processor submits the file for final underwriting, the final 1003 should reflect a true and accurate picture of the borrower s personal and financial data, as well as accurate subject property information. All supporting documentation should be included in the loan file as well. Section 201 Not Ready Status Not Ready loans should be treated at the same priority level as loans that are considered Approved with Conditions. If a loan is deemed Not Ready, the underwriter will request documentation from the assigned 5
processor via the conditions sheet. The processor will begin working on the loan and obtaining all of the approval conditions detailed on the sheet. Section 202 Loan Committee Recommendations One underwriter cannot deny a loan. If an underwriter recommends a loan for denial, they must send the loan to Loan Committee with an email to the LO stating the reason they want to deny the loan. The LO then has 48 hours to work with the loan committee to send in compensating factors to try and get the loan approved. There are also other factors that can cause a loan to get to Loan Committee that are just for a second set of eyes. If the loan is a higher risk loan, the underwriter will send the loan to committee for another review. Section 203 The Loan Process: A Visual 6
SECTION 300: PROCESSING PROCEDURES 7
Section 300 Processing Procedures Section 301 The First 24 Hours Upon receipt of a new file, processors should take the following steps within 24 hours: Complete the 24-hour checklist that corresponds to the loan program the borrower is pursuing. Date the checklist once you ve completed the entire document. Review the conditions sheet, accessible from print forms in PCL (sheet #1221). Once the approval conditions are satisfied, enter the Loan Ready date in the General Information screen. An auto email will be sent to the underwriter as notification that the file is ready to be reviewed. Become familiar with all aspects of the file. o Verify the closing date o Confirm that information in the file is consistent with the information in PCL (i.e., closing date, employer address, contact information, assets, etc.). Send the Notice of Incomplete Application (NOI) to the borrower, if applicable. Section 302 Welcome Emails An important step with every new loan is to send a welcome email. If the loan is Approved with Conditions and the loan officer gives the processor permission to send the welcome email directly to the borrower, the processor initiates the email by using the appropriate template from within PCL If the loan officer does not give the processor permission to email the borrower directly, the processor will send an email to the loan officer. The processor will ensure they use the specific email template for the status of the loan. Note: For loans whose status is Not Ready or Loan Committee, the processor will not email the borrower and will instead send a welcome email to the loan officer and/or loan officer assistant. Section 302.1 Initiating Emails to Borrowers 1. Open the file in PCL. 2. Open a new email entry. 3. Select all borrowers as recipients. 4. Select loan officer and loan officer assistant to be copied. 5. Hit the template button found on the right. 6. Select Processor Welcome to Borrower. 7. Read the email. 8. Edit the bullets currently entered that state Conditions in Detail. Replace with the actual conditions from the conditions sheet that are needed from the borrower. When entering the conditions, please remember to include the details of what we need. If an updated bank statement, enter in a way that is both clear and concise. Ex: Most recent bank 8
statement including all pages with details of transactions and showing the banks name, your name and the account number. Editing tips BEFORE the emails are sent out: Check spelling. Do not cut and paste conditions directly from condition sheet. Explain using entire words, not abbreviations. (LOX vs. Letter of Explanation) 9. After editing with the borrower conditions, hit send. 10. If the conditions have not been received, please follow up with an email and a phone call to the borrower 72 hours from the time the processor starts the first 24 and also on day 7 to discuss the conditions. This is a daily processing procedure as well. Section 302.2 Email Template Dear Mr. Borrower, Congratulations! You have received a conditional approval on your mortgage application. I will be assisting your loan officer, (William) Bill D. Horton, in the processing of your loan. The underwriter has issued a list of conditions that must be met in order to give you a full approval before your closing date. Although I will take care of most, I will need your help with the following: 1. Copy of your Earnest Money Check and proof it has cleared the account. 2. Proof the debit for the appraisal has cleared the account. 3. Paystub for Yancey County schools. (Must be specific: month, date, etc.) 4. Updated statements for all accounts. These statements must be a full 60 days. Please provide documentation for any deposits of $1000 or greater, as we will need a letter of explanation and a paper trail for these deposits. All pages will be needed, even if blank. If you are submitting retirement funds, we will also need terms of withdrawal. ***If the Earnest money check and the appraisal fee does not show up on this statement, then we will need a print out from the last day of the statement to the current date. This print out will need to show the webpage at the bottom or will need to be stamped AND signed by a bank representative. If there are any large deposits on these printouts, the same documentation as described above will need to be provided. Please submit these items as soon as possible. If you have already submitted some of these conditions to your loan officer, I can collect the documentation from him/her. If you have any questions, please do not hesitate to contact your loan officer or me. I look forward to working with you and hope you have a wonderful day! You loan officer (William) Bill D. Horton can be reached at: Phone: (555)555-5555 Email: joethelo@movementmortgage.com Fax: (444)444-4444 9
Regards, Lucy Loan Processor LucyLoan@movementmortgage.com (757)227-3385 (757)333-3333 fax Section 303 Additional Procedures Processors are responsible for the following steps, as appropriate, during the loan process. When a TBD file receives a property address and the loan is converted to an application: o o o Enter all sales contract information (sales price, EMD, address seller credit) and the closing date in PCL. Run Desktop Underwriter or Loan Prospector for Approve/Eligible (DU) or Accept (LP) and re-run the Drive report. Enter the submitted date to reflect the date the contract was received. When Processing receives a title on a file: o o o o o Verify all title work is in file: ICL, title commitment with 12 month chain of title, wiring instructions, Preliminary HUD, E&O s. Review for accurate borrower and property information, as well as the settlement agent s name. Use the title checklist for guidance when reviewing the title documentation. Scan to PCL image folders. Note requests and updates, if applicable, in the Remarks section of the title folder. Request any corrections or missing information, if applicable, directly via the attorney/title contact. When Processing receives an appraisal for a loan: Verify all data information is accurate in PCL after the underwriter has reviewed and approved it Check status: as is, subject to plans and specs, subject to repairs. Notify the loan officer if a final inspection is required. Re-run DU or LP and notify the reviewer or conventional if there are any red flags (Y6 for LP). Pull a case query and verify all information is correct in the case of FHA. Within 10 days of closing: Perform verbal VOE. Re-verify that the borrower is still employed, in the same position, with no material changes (unless retired). Scan to PCL Images and drop into the appropriate folder. 10
SECTION 400: MANAGING THE PIPELINE 11
Section 400 Managing the Pipeline After the processor completes the steps required during the first 24 hours, including the 24-Hour Checklist, he/she begins working on the During Processing Checklist for the applicable loan product and continually manages their pipeline. Section 401 Projected Closing Report The Projected Closing List by Processor report is the most critical report for the processor. This report should be run several times a day to ensure the most up-to-date information is entered in PCL: o Every morning o Before or after lunch o Late afternoon From the main menu (prior to entering a loan) click the ellipsis [three dots] next to the Search field and select Projected Closing List by Processor, then OK. Click on Show Me the Loans (the eye logo), search for your name, click OK and Requested Close. Input the dates you want report from and to. Click OK to retrieve pipeline. Sort as needed by clicking on the column header (sample below is sorted by Requested Close date). 12
Review unassigned images, which are added as outstanding conditions arrive, within 24 hours to verify whether or not they may satisfy a condition on the conditions sheet. Refresh the pipeline throughout the day to check for new images. Email your loan officer or borrower to let them know if submitted documentation is sufficient or not and explain why. Move in the Additional Items folder. Example: As shown in image above, there are 12 unassigned images for the first loan listed. In this case there are 12 images to review and categorize. 13
Once conditions have been reviewed and satisfied, the condition sheet will need to be updated in the imaging screen, either by signing off on the condition or noting as much in Remarks. If you are not sure of a condition or of a document provided to satisfy condition, contact your team lead immediately. Send an email to the loan officer or use the Remarks field to list out all needed items required to satisfy the conditions. Do not ever change conditions. Only underwriters may do this. 14
SECTION 500: CLEAR TO CLOSE 15
Section 500 Clear to Close Once all conditions have been satisfied and file is ready for the Actual Processing Date or the Condition Submit Date, processors will take the following steps in an effort to receive a clear to close message from underwriting. Confirm that all documents in imaging are signed off. Make sure final AUS findings are correct and that ratios and figures match PCL, final 1008, 2901-FHA Transmittal or the 46-VA Loan Analysis, 215-VA Loan Summary. Purge the image file of any duplicate or outdated documents and move them to the Additional Items image folder. Check verification of employment dates and update if needed (must be within 10 days of closing). Go to the General Information screen and enter the date for APD or CSD and send an email request to the underwriter that the file is ready for final review or CSD. Include a detailed list of pending items and attach the Underwriter Checklist. Send separate email to LO/LOA giving them an update. Complete the Underwriting Checklist for appropriate loan program and drop into the Underwriter Checklist folder. Once you receive a clear to close from the credit underwriter, you will be notified via email and the loan will be assigned to a closer to start working on sending out a closing package to finalize the transaction. You may need to assist the closer, loan officer, loan officer assistant, underwriter and/or QC Specialist with any issues that come up while the file is closing. All closing issues must be handled immediately. 16