Mortgage Application Processing Checklist Template

Assigned to the loan officer and processor. Every early disclosure is due from the application date recorded in the first task.

• Record the date the sixth piece of information arrived — name, income, Social Security number, property address, estimated value and loan amount; that is the TRID application date
• Record the loan purpose and occupancy — Purchase, Refinance or closed-end Home equity, and whether it is the borrower’s principal residence; HELOCs and reverse mortgages fall outside TRID
• Deliver the Loan Estimate within three business days of application — and at least seven business days before consummation
• Send the other three-day disclosures — the home loan toolkit for purchases, the housing counselor list and the notice of the right to a copy of any appraisal
• Collect no fee before the Loan Estimate and intent to proceed — except a bona fide, reasonable credit report fee
• Show the loan originator’s NMLS ID on the application — and later on the note and security instrument

Assigned to the processor.

• Record the intent to proceed, how and when it was given — silence is not intent; after 10 business days without it, a revised Loan Estimate may be issued for any reason
• Verify income, employment and assets from third-party records — W-2s, tax transcripts, verifications of employment and bank statements
• Send the credit score disclosure to the applicant — FCRA s.609(g), as soon as reasonably practicable after using a score
• Order the appraisal through an independent channel — no one with an interest in the deal may influence the appraiser
• Order title and record liens to be paid — and confirm vesting and any survey or HOA requirements
• Order the flood determination and record whether the property is in a special flood hazard area — if Yes, send the notice a reasonable time before closing (agencies treat 10 days as reasonable)

Shown only when the processor records a changed circumstance or a rate lock after the first Loan Estimate.

• Record the reason and the date you learned of it — an extraordinary event, new or inaccurate information, a borrower-requested change, a rate lock or an expired Loan Estimate
• Identify which charges changed because of it — only those may be re-baselined for the tolerance test
• Issue the revised Loan Estimate within three business days of learning of the change or lock — and attach the evidence
• Check the borrower will receive it at least four business days before consummation — and never on or after the Closing Disclosure

The underwriting approval task is assigned to a named underwriter with authority for the loan. The checklist halts until it is answered.

• Underwrite to the eight ability-to-repay factors — income or assets, employment, the payment, simultaneous loans, taxes and insurance, other debts and support, DTI or residual income, and credit history
• Determine QM status — the General QM price test and points-and-fees limit, another QM definition, or a documented non-QM ATR decision
• Check higher-priced and high-cost status — higher-priced loans carry escrow and appraisal rules; high-cost loans carry HOEPA rules
• Issue the conditional approval with prior-to-document and prior-to-funding conditions
• Clear the conditions and give final underwriting approval — Approved or Not approved
• Record the decision — Approved, Denied, Withdrawn or Closed as incomplete; anything but Approved opens Phase 5

Shown only when the decision is not Approved.

• Send the adverse action notice within 30 days of a completed application — with the specific reasons, the ECOA notice and the FCRA disclosures
• For an incomplete file, send a notice of incompleteness or decline — and record which you chose
• Record a withdrawal with the date and who gave the instruction — the HMDA “action taken” code depends on it
• Provide the appraisal copy even though the loan will not close
• Refund any fees the borrower is owed and close the file

Shown when the decision is Approved. Assigned to the closer; the rescission task applies only to a refinance or home equity loan on a principal residence.

• Deliver the Closing Disclosure so it is received at least three business days before consummation — a mailed CD is treated as received three business days after sending
• Run the tolerance check — zero, 10% cumulative and unlimited buckets; refund any excess within 60 days after consummation
• Restart the three-day wait — if the APR becomes inaccurate, the loan product changes or a prepayment penalty is added
• Confirm flood insurance is in force before closing — where the property is in a special flood hazard area
• Hold the closing — identity checked, note and security instrument signed, every required party present
• Rescission: give each person with the right two copies of the notice — and fund only after the three-business-day period ends
• Fund after a second person verifies the wire instructions by phone to a known contact

Shared between post-closing, the HMDA coordinator and QC. QC is done by someone outside the production team.

• Closed loans: record the security instrument and chase the final title policy
• Enter the loan on the HMDA LAR within 30 calendar days after the quarter ends — HMDA reporters only; check the fields against the file
• Closed loans: deliver the loan to the investor and send any servicing transfer notice
• Select and review the post-closing QC sample — under your QC plan and investor requirements, with findings logged
• Retain the TRID records — the Closing Disclosure and related documents for five years, other evidence of TRID compliance for three