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4 Steps to Solving Loan Officers’ Biggest Pain Point

by | Sep 18, 2019

Loan officers have to be fact-based, especially since the government made compliance a requirement. While the guidelines make the process smoother for the consumer, it’s your job to adhere to the guidelines. It’s critical that loan officers and lending companies protect not only the consumer but themselves. Without proper knowledge, loan officers and lenders are more prone to errors that put their revenue and reputation at risk.

These simple four steps can help any loan officer stay on top of compliance knowledge in the mortgage industry. 

Stay up to date on regulations.

There are so many regulatory bodies in the mortgage industry. Fannie Mae, Freddie Mac, Federal Home Loan Banks, US Department of Housing and Urban Development (HUD), US Department of Veteran Affairs, and FDIC, are just a few. If you work as a loan officer at a lending company, they should provide information on updates, but it wouldn’t hurt to take matters into your own hands to make sure you’re in line with the guidelines. 

The Mortgage Compliance Magazine recommends that you follow these agencies on Twitter for updates on new changes. We’ve also created a list on Twitter that you can subscribe to for updates on compliance for loan officers. If you don’t see an agency, let us know!

Educate yourself.

Since the Nationwide Licensing System and Standards, lenders have been required to provide training, testing, and criminal and credit screening to employees to improve ethics and adherence to federal and state laws. However, there’s nothing stopping loan you from taking education a step further.

Regulatory agencies like Ellie Mae offer education courses on compliance for loan officers. In one particular course, the key takeaways include the identification of federal regulations and red flags for violations in practice; the ability to explain how applicable various regulations are to your business; and being able to describe key definitions as they relate to federal and state regulations. 

Put a process in place. 

The road to getting loans processed and approved is paved with numerous stakeholders. As the loan officer, you can create a general workflow as a template for every loan, so you can ensure all the necessary steps are taken. 

Another solution to simplifying the loan process? Adding AI in the workforce

Moving quickly and forgetting necessary signatures, for example, can go against standards and delay the loan process. With robotic process automation, you can create workflows that streamline every stakeholder’s task by calling on your go-to apps’ APIs. 

For example, loan officers can streamline the process rather than sending paperwork to the general counsel or compliance counselor for sign-off. An app could scan all the documents to ensure the required signatures are present and signed by the necessary date.

Protect yourself. 

Educating yourself is one way to protect yourself. However, you can also document and store all your client and loan information in one central location. The use of a knowledge sharing platform ensures that you have quick and easy access to details that can defend you if there are any discrepancies, or get to the root of an issue without any delays.  

Another benefit of knowledge sharing includes the ability to avoid issues when it comes to lead ownership, which is a big-time waste for lenders and loan officers alike. There can be quite a bit of turnover in the mortgage industry. If you can determine where a lead originated, you won’t have to sort through the rubble of a team member’s departure. 

Compliance for loan officers is simply nonnegotiable, and the buck often stops with the loan officer. Instant access to accurate knowledge will not only protect all parties involved, it will produce a better customer experience and boosted loan officer productivity.