How can a Third-Party Fulfillment company help you grow as a mortgage banker?

June 3rd, 2022 by Sean A. Stephens, Esq., CMB®

What is a Third-Party Fulfillment company? How can a Third-Party Fulfillment provider help you grow as a mortgage banker? How can a mortgage lender reduce cost and risk when ordering closing documents?

As many brokers transition into becoming a mortgage banker, one of the biggest pain-points I see involves the closing document process, preparation of the CD, ordering the wire, post-closing conditions, and those steps needed to obtain the purchase advice.Mortgage 3rd Party Fulfillment companies

As recently discussed, there can be a variety of ways to accomplish this process. In today’s short video I will focus on the benefits of utilizing a third-party fulfillment provider and how they can assist in the many aspects of this integral part of the process

Now, if you have not yet done so, remember to take advantage and schedule a complimentary 30-minute initial strategy call where we analyze your situation and discuss whether a banker transition process is right for you!

During this call, we will provide practical expertise and understanding of the process from mortgage licensing, investor approval and relations, warehouse bank selection, third party fulfilment providers, E&O and Surety bond companies, origination strategies, coaching, consulting, and more!
Call/Text: (714) 844-7146

What are the benefits of using a Third-Party Fulfillment Company in the mortgage process?

There are lenders who provide the ability for you to draw the closing documents from right within their system. While this is convenient for many, this does involve increased costs for the correspondent and lack of autonomy in the process.

With that being said, a third-party fulfillment provider can provide the flexibility needed since they are able to provide as much or as little as you need in the way of closing and post-closing support.

For example, you can order the entire closing document package, have them coordinate the initial CD and work with you to balance the final CD prior to closing, prepare the wire request to be submitted to the warehouse bank, schedule the wire for the funding date, upload the closed loan package along with any funding conditions to the investor, work on getting all required post-closing conditions, then obtain the purchase advice and submit that to your warehouse bank.Third Party Fulfillment Company for Mortgage Bankers

This outsourced process can also allow for the additional benefit of increased quality control checks to confirm that the closing process is in compliance with TRID requirements. Especially if you are lending in multiple states, the third-party fulfillment provider will help you scale and grow your business into these new areas without you having to worry about drawing docs on your own and running the risk of preparing inaccurate closing documents.

If one of those states happens to be Texas, (outside of a few exceptions) Texas law requires that a licensed Texas attorney handle the “preparation of a legal instrument affecting title to real property, including a deed, deed of trust, note, mortgage, and transfer or release of lien.”

As an alternative, you may not need the full suite of services. In that case you may also have a closer on your team work in conjunction with the third-party fulfillment provider and be able to customize what they offer to fit the needs of your organization.

What are the costs of NOT using a Third-Party Fulfillment Provider for your loan closing?

Remember, the cost of the fulfillment provider can be disclosed to the borrower on the LE, CD, and then collected at closing. This allows you to avoid the higher administrative fee that many lenders charge for the convenience of ordering closing documents through their platform.

In addition to those higher administrative/underwriting costs to purchase the loan, this reliance on convenience removes your ability to obtain best execution for pricing with a variety of investors.Mortgage Broker to Banker Consulting

Since you are tied to the end investor who you also rely on for document preparation, this does not permit you to source different investor pricing and obtain optimum revenue. On the other hand, a fulfillment provider allows you to maintain your independence and truly search for the best execution pricing for that individual loan file. Although this is more of a hidden charge, remember that every basis point counts in today’s market! You don’t want to look back at the end of the year and see money left on the table that was lost due to “convenience”.

Now, wouldn’t it be nice if there was a blueprint available that would walk you through the steps on how to climb the mortgage banker ladder!

Well, that is where we step in to help with our practical expertise and understanding of the process from mortgage licensing, investor approval, warehouse bank selection, third party fulfilment providers, E&O and Surety bond companies, origination strategies, coaching, consulting, and more!

You can simply use our online scheduler to select a convenient consultation time and let us show you the Path to Prosperity!

Sean A. Stephens, Esq., CMB®
Broker to Banker Consulting, LLC
Call/Text: (714) 844-7146
Toll Free: (866) 989-0564 Ext. 419

Sean A. Stephens, Esq., CMB® 

Legal Disclaimer: The information provided on this blog does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. No representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, or availability to this information. Use of, and access to, this Blog or any of the links or resources contained within the site do not create an attorney-client relationship. Broker to Banker Consulting, LLC is not a law firm and does not provide legal services.

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