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The Value of a Third-Party Processor

An experienced third party (or “contract”) processor can provide substantial benefits to brokers and loan officers. Having a talented resource available without adding fixed overhead allows the flexibility to manage volume fluctuations and maintain focus on the front end origination. Brokers and loan officers are able to hand off the file and know that it’s still being worked on while focusing on what’s most important, finding new deals. The best part is that none of the cost has to come out-of-pocket. The fee is added onto the LE/CD and paid at closing with the transaction.
sign highlighting benefits of outsourcing

It is essential to properly document the use of a third party processor on loan documents. Here are some tips to consider:

    • Contract processors should be NMLS licensed and provide an invoice for their services.
    • Fees for processors who are affiliated with the broker count in the 3% QM test (processors paid by W2 from the broker).
    • Fees for unaffiliated processors do not count in QM (1099 processors).
When looking to contract a processor, make sure they have mortgage experience. The goal is to free up your time, not create more work for yourself. Our dedicated team at Premier Processing provides fast turn times, licensed processors and experience you can trust!

For more information on contract loan processing, please contact us at 888-216-1030

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