Loan Officer Training - 11/6/2024 - Effective Document Collection: Best Practices for Loan Officers - Loan Officer Training with The Mortgage Calculator

Episode Transcript
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Restream recording Nov 06, 2 (00:13):
So we all know how hard it is to
get these loan applications,right?
And we know all the obstaclesthat we can face.
We certainly do not want to addany additional impediments to
the process, uh, by dropping theball.
Uh, in the document procurementstage, right?

(00:34):
So, uh, let's get right into it.
Luckily at the mortgagecalculator, we have all the
tools.
So this should just be arefresher course for our team
members.
So let's get right intoeffective document collection,
best practices for loanofficers.

(00:56):
So notice there, right there atthe top.
And center efficiency, accuracy,and clear communication combined
with the use of technology canimprove timeliness and client
satisfaction.
That is what we're talking abouthere.

(01:18):
Uh, getting the job done, right?
So what are some of the commonchallenges that we find in the
document collection process?
Well, Uh, and obviously thesearen't all inclusive here.
This is not an all inclusivelist, but we are touching based
on the, um, the most commonissues is the first would be

(01:42):
missing or incomplete documents,right?
Uh, they're sending you threepages of a five page bank
statement, um, two pages of thetax return.
Only the first two pages.
I mean, and then you're goingback and forth.
A bunch of times about what'sactually needed, uh, client

(02:04):
confusion about requireddocumentation is another issue,
uh, time delays that may becaused by incorrect
documentation.
And I'll touch base on thesolutions on these in a minute
as an expand on these.
Insecure transfer, criticaldocuments, inconsistent

(02:30):
communication with all parties,and, and lack of transparency on
the timelines.
So, let's, uh, talk about, uh, alittle bit more in these as we
talk about, uh, What are thesolutions or the best practices,

(02:52):
uh, for, uh, documentcollection?
The first one, uh, would be toempower your borrower And set
clear expectations.
This one is going to tackle thechallenge of the lack of
transparency on the timeline,right?

(03:14):
You're going to empower yourborrower.
You're going, you're basicallygoing to educate them on the
process.
Why you need what you need,right?
As you go down the list of theproduct of the items that you
need, right?
You're highly recommended thatyou provide some type of a
checklist depending on the loantype to the borrower.

(03:37):
You could custom tailor yourchecklist.
Uh, for the specific needs ofthat borrower, if you, uh,
identified, uh, some additionalissues outside of the, the
standard required docs for thatloan type.
And in doing this, you're,you're, you're going to, like I
said, you're, you're going toestablish clear timelines.

(03:57):
You're going to, uh, establishclearly why you need what you
need and when you need it.
This is very clear becauseyou're going to initially
discuss this checklist with yourborrowers because then once you
get that initial condition ofapproval from underwriting,

(04:19):
you're also going to discussthat list of conditions with
your borrower clearly, uh, tothen restate what is needed.
And why it is needed.
You're just not gonna send theman email without any
explanation.
Uh, I like to send the emailnice detailed and then followed

(04:41):
up with a call so that we can goover these items, go over the
conditions, go over the neededdocuments.
One by one, explain what isneeded, why you need it.
What document that they need toprovide to satisfy the
condition.
All very important.

(05:01):
So we're talking about ways toavoid receiving missing or
incomplete documents, right?
We mentioned the checklist.
We mentioned empowering theborrower, which is going to
hopefully eliminate that clientconfusion about the required
document.
It's gonna add transparency onthe whole process.

(05:23):
very much.
Uh, but, uh, we need to ramp,you know, we need to basically
ramp this up.
Uh, I guess I would like to say,put it on steroids and that's
going to be through the use of aCRM or CRM software.
You know, we, we have a greatproprietary software that

(05:44):
handles our quoting and it alsohandles our secure, uh, Document
procurement, and it also handlesa lot of these other
recommendations like automatedocument requests and reminders,
right?
You know, our system, the CRMsystems, whichever one you use,

(06:04):
and ours in particular does thisas well, will send out automated
document request reminders everyso often to the borrower.
depending on what you have setup in the system.
So in order for the CRM toproperly work, whatever CRM
system you use, you have to makesure that you have it properly
set up.

(06:25):
Uh, and then the, uh, so thecustomer can be receiving those
document requests and thedocument request reminders,
right?
You're gonna go to the CRM.
You're gonna load up.
What you need from the borroweras far as documents, you're
going to clearly state, uh, whyyou need those documents in the

(06:46):
explanation, you're going tohave your whole list, and then
you're going to click to send arequest to the, to the customer.
They're going to get the emailwith the request with the list
of items needed.
They can click on the link.
It takes them to the CRM wherethey can see all the items
needed there.
And then they securely uploadthe documents.
The items that are needed.

(07:07):
So that's the next bullet point.
There is secure document uploadstorage and organization.
Very important because the lastthing you really want.
The last thing you really wantis to, uh, have borrowers
emailing you for many reasons,right?

(07:28):
It just breaks all of the tenetsof secure document uploads, uh,
document security of thecustomer private and personal
information.
And on top of that, I don't knowabout your email.
My email can get a little crazy,uh, uh, during the day, a lot of
stuff coming in at one time, uh,lot of, you know, different

(07:48):
attachments all over the place,it's real easy, easy for an
email to get missed for a bit.
And then by the time you see it,uh, you know, Timeframes could
have changed, right?
Uh, or maybe it went into thespam and you didn't see it right
away.
Then you decided to check yourspam at the end of the day.
And lo and behold, there's thatemail that you were waiting for,

(08:10):
or the, the document that youwere waiting for the customer
that you thought.
You know, however you were goingto get it.
And instead they emailed it toyou.
Right.
So, you know, to avoid all thatkind of stuff happening to have
a secure document uploaded,let's say for example, tax
returns, you would never reallywant to borrow or emailing you

(08:31):
tax returns or anything wherethere's social security number
and other personal privateinformation that could result in
identity and identity theft.
If your email gets hacked, forexample.
Uh, so again, secure documentupload storage and organization
and that goes hand in hand,especially if you have a

(08:52):
processor on your loan and inall of our in house deals, uh,
in all of our deals, but we'renot done.
We have in house processing.
Uh, plus, uh, we may be workinga deal together as a team and
having the CRM to collectdocuments also allow it.
It, it, it allows the documentsto be easily tracked, received,

(09:15):
and securely shared with otherteam members.
So instead of emailing the taxreturns to the processor or to
another MLO that's working onthe deal together with you for
review, they could just accessand download the document from
the CRM where it was securelyuploaded.

(09:36):
Uh, by your borrower.
So everybody can review thedocument.
If management is looking toassist you with the file to
review the income calculations,no need for you to email
anything.
Uh, the CRM can just easily beaccessed by whoever has login
credentials.
The documents could be, could bereviewed in a secure manner

(09:59):
without risking, uh, theborrower's personal and private
information.
Thank you.
Right.
I mean, I can't, I can recall afew times that, uh, that I have
received credit reports, forexample, via email, you know,
what we've had to tell people,please don't, don't send a
credit report.
Uh, we can view it in the file.

(10:21):
We can go into the CRM and wecan download it from there and
we can review.
And that's the, one of the mainreasons of having the CRM secure
document, upload storageorganization, easily track
documents received and securelyshare with other team members.
Human, um, uh, factor here isonce you do have all the

(10:45):
documents right in your secureportal, then remember to please
review and verify all thedocuments, uh, are all the
documents complete?
Did you get every page of thebank statement?
Did you get every page of thetax return?
It's not the first.

(11:10):
Someone has provided a bankstatement and left out that
blank page five of five becausethey thought that they didn't
need it because it was blank.
Well, you know what?
Underwriting doesn't know thatit's blank.
We don't know that it's blank.
Only they know that it's blank.
So all pages of any document, ifit says one of eight, we need

(11:32):
all eight pages on there,regardless of it's three of the
eight pages.
Are blank or have no, no usefuldata.
We still need it.
So that's the same with taxreturns.
How many times have you onlyreceived the first two pages of
a tax return?
Right.
And it turns out that the taxreturn could be 20 pages.
All you got page one and two,but you're missing schedule one,

(11:55):
schedule two, schedule three,uh, schedule C, schedule E and
whatever other schedules may beapplicable for that tax return.
The Borrowers don't know.
So you just got to remind themall in every single page, even
what they may consider the junkpages.
We need everything.
And it's your job as the MLO toreview every single document

(12:20):
that is turned in by theborrower.
Make sure if the document isactually what was requested for
the condition, make sure thatthe document is complete.
Make sure that the document isup to date.
Make sure it's even correctlyformatted.
Is it, are we supposed to beturning in PDF only documents?
Are you turning in a photo, aJPEG document?

(12:44):
Are you turning the document in,in five individual JPEGs?
And it's really supposed to beone five page PDF document.
And if you're turning it,turning it in like that to
processing, are you expectingprocessing to.
Convert it to one document.
Are you just expectingprocessing to just turn the
document around, send it tounderwriting like that as five

(13:06):
individual photos of a taxreturn and expect then
underwriting to merge thedocuments for you?
No.
The correct answer there wouldbe if the borrower, by whatever
unfortunate circumstance, endedup, for example, uh, sending you
20 photos Of 20 pages of fivedifferent bank statements.

(13:31):
Unfortunately, you're going tohave to convert those JPEG
documents to a PDF.
Uh, uh, file each one, and thenyou're going to have to merge
those PDF documents each intoeach corresponding bank
statement, if that's what you'retrying to submit or whatever it
is incomplete documents in PDFformat would be the preferred,

(13:51):
um, that's going to helpprocessing and definitely going
to help underwriting and mindyou, uh, when you are putting
those documents together, pleasegive them.
Proper names, because at thispoint, the document collection
and ensuring that they'recomplete and accurate is also

(14:13):
going to depend on the name thatyou give that document.
Right.
So if you got the 2023 W2 forborrower John Smith, don't leave
the standard name that may comeover last two years W2s and
that's the name of all your W2sbecause you didn't change the

(14:33):
name.
Maybe the customer uploaded itinto the portal.
It keeps whatever name.
Is on the document requiredcondition.
Uh, and then you didn't changethe name to the specific
document, the 2023 W2, 2022 W2,September, 2024 checking Wells

(14:54):
Fargo versus the September, 2024checking from chase, right?
Uh, don't have every documenthave the same name and then have
underwriting or processingtrying to figure out what you
uploaded because what you'regoing to get in that scenario is
you're, you're going to geteither, uh, an upset processor,
uh, which is going to rejectyour documents or worse, you're

(15:16):
going to get an upsetunderwriter who's going to
reject your documents, suspendyour file, and give you a whole
laundry list of conditionsactually needed.
Okay.
Um, and then you're going to bein an uphill battle.
So, uh, procurement of documentssounds like it's a very basic
function, but actually, uh,getting the loan application is

(15:39):
just part of it.
But then properly getting thefile, uh, worked, uh,
procurement of documents, uh,verification of documents, and
then submission of documents ina timely manner is all going to
really depend on the officer.
Uh, again, following, uh, thesesteps that we have outlined
here, pretty basic steps and,uh, keeping the, keep, you know,

(16:03):
connecting all the dots,effectively communicating
everything, uh, to the customersthat at the end.
It's a positive experience foreverybody and your loan closes
on time.
So, I want to see if we have anyquestions there.
I do see that we have onequestion.

(16:24):
Are there document checklists inthe Knowledge Center?
Yes, there are.
We have document checklists forall the different loan types,
right?
Conventional, DSER, bankstatement, and the like.

(16:45):
Let me see, we have anotherquestion here regarding, uh,
naming of the documents, uh,when the document is in the
system and it's beingtransferred to the Encompass
file.
Question is, is it possible thatwhen we correctly name a
document in the CRM, that whenyou click E File to Encompass,

(17:06):
that the name you gave thedocument show as a name in
Encompass?
very much.
The name on the documenttypically is, is going to be
whatever you requested.
So if it's a standard request,the standard request has a
preset name on it.
If it is a, uh, you put arequest in the, um, the

(17:29):
customized request, it's goingto have a name on it.
So when the file does get intoEncompass, you are able to name
the file.
if you're not happy with thename that Encompass gives it.
What happens is that most, mostpeople don't change the name or
just upload, uh, with a verybasic PDF name.

(17:50):
And that's the problem.
The key is here is when yourfiles get uploaded to Encompass,
make sure that the name on thedocuments are correct.
And if not, just please makesure you revise the name.
And I don't see any additionalquestions.
I'm going to give it anothermoment, but I guess the best

(18:11):
takeaway from here is make surethat you properly use your
technology that you already havein place.
It's put in place there to helpyou complete your work in an
efficient and timely manner toavoid these common challenges
that you can face in thedocument collection process.
very much.
And to ensure, uh, a, a nice,uh, satisfying, positively

(18:35):
satisfying experience for yourborrower so that you can get,
uh, referrals and additionalbusiness.
All right.
So I do not see any additionalquestions.
So I do thank all of you for,uh, being on here today.
And I look forward to, uh,seeing you tomorrow at 12 noon

(18:57):
for tomorrow's training, have agreat day.

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Loan Officer Training - 11/6/2024 - Effective Document Collection: Best Practices for Loan Officers

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