Premier Processing is looking to bypass those disadvantages and provide brokers with a third-party option with flexibility and broad expertise.
“We’re licensed in 45 states,” said Suzanne Okun, President of Premier Processing. “I started this company when I saw a need for a mortgage loan processing company with licenses in multiple states. What we did is put together an in-house team, as opposed to an independent processor who works from home and doesn’t have the availability loan originators might need.”
Okun started the business in Michigan in 2016. By the end of the year, Premier Processing was licensed in two additional states.
“Then I spent 2017 accumulating the rest,” Okun said. “It was an endeavor. I was basically a full-time ‘student’ last year. You’ve just got to take the time to take the exams from state to state to complete licensing requirements.”
The company also utilizes a flat fee structure to take the guesswork out of loan processing costs, Okun said.
“We keep fees very steady,” she said. “Different types of loans may have additional fees but they are all disclosed up-front. The only loan category we really don’t work with is reverse mortgage
And there are several other advantages to utilizing a third party processor, Okun said.
“We’re available if brokers have overflow or volume problems. They’re not responsible for paying our overhead or income tax,” she said. “And there’s no training involved – whereas if a broker hires an employee as a processor, they’re typically going to have to train them. In addition to that, if their volume fluctuates, they’re going to have to find something for that processor to do. It’s almost the same as in the manufacturing industry, where they have a vendor or company that provides them with products or staff as they’re needed. Third-party processing serves that need. It helps the broker so the broker doesn’t have to invest in all the personnel.”
One of the principal benefits, Okun said, has to do with the qualified mortgage rule’s 3% points-and-fees threshold. An in-house processor’s services would count toward that 3% – but that’s not the case with third party processing.
“It’s billed on the LE as a third-party fee.” Okun said.
And since the fee is added to the LE and paid at closing, Premier Processing has yet another advantage over in-house processors.
“We don’t get paid unless the originator is paid,” Okun said. “If the loan doesn’t close, we don’t get paid. In an employee situation, that’s not the case.”
And Premier Processing’s team insures more responsiveness than brokers could get from a single, independent processor.
“Our corporate offices are located in Michigan, and our processors are in-house. We have an onboarding specialist who’ll help new clients and set them up with their secure portal, credential and submission sheets, and review with the broker as to how to submit a loan,” Okun said. “The advantage is, if you have a broker who’s doing a monthly volume of the same amount of loans, he’s going to be working with the same processor, so they form a relationship. If that processor is out sick or for some other reason isn’t available, we have someone else who can step in for them. That’s a big difference from someone who works out of their house and has their own priorities – running errands, picking up their children, etc.”
And the company’s multi-state licensing and ability to work with many different lenders makes it more versatile than a single operator, Okun said.
“We work with easily 25 lenders. So if a broker comes to us and says, ‘I do all non-QM
and I work with XYZ company’ – as opposed to a more conventional company – we have no problem using their systems,” she said. “Additionally, having the processing done in one place, with a team and a staff – you’re always compliant. We provide up-to-date technology and the capability to complete the loan processing and bring it to ‘clear to close’.”
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Mortgage originators, as any professionals, like to save on overhead wherever possible. To do that, many brokers have turned to third-party processors (TPP) to handle the mountains of paperwork that come with even the most straightforward loan. But third-party processing can have disadvantages: Many processors work from home and may have limited availability, or they’re only licensed in one state.