In Basic Characteristics And “Life” of Residential Mortgage Loans mortgages expert witness J. F. “Chip” Morrow writes:
In today’s real estate mortgage market, it is essential that the expert understand, be fully aware of, and cognizant of the entities involved and their roles in initiating, processing, underwriting and funding all types of prime and subprime residential mortgage loans including ones. In addition, the stages that a prime and subprime residential mortgage loans processes through during its “life” are also crucial…
A mortgage banker underwrites the risk involved in making a mortgage loan to determine whether the borrower satisfies the loan underwriting guidelines for the loan program and to ensure the associated risks are acceptable. After underwriting approval, the mortgage banker funds and closes the mortgage loan. Then the mortgage banker either sells/ships the mortgage loan to the investor or retains it in its own portfolio. In addition, the mortgage banker performs a quality control audit on a statistical sampling of the closed mortgage loans to detect fraud and to insure compliance with policies and procedures.