Private mortgage insurance, or PMI, is insurance that buyers may be required to obtain. PMI is usually required on a conventional loan if the down payment is less than 20% of the home's purchase price.
PMI serves as a safeguard for lenders in case borrowers default on their mortgage payments. It provides protection by covering a portion of the lender's losses if the loan goes into foreclosure. While PMI benefits the lender, it allows buyers to purchase a home with a lower down payment, making homeownership more accessible.
It's important to note that PMI is an additional cost that borrowers must factor into their monthly mortgage payments. The specific amount of PMI can vary based on factors such as loan amount, credit score, and down payment percentage.
However, as you make mortgage payments and build equity in your home, there may be opportunities to cancel or remove PMI once you reach a certain level of equity.
Contact us today to connect with a knowledgeable loan officer who can provide valuable insights into PMI requirements and help you make informed decisions that align with your financial goals.
Specialized VA Knowledge
VA loans have unique requirements (COE, residual income, funding fee calculations, appraisal requirements).
A contract processor experienced in VA loans can spot potential issues early and streamline the process.
Cost Savings for Lenders
No need to hire full-time staff; processors are paid per file.
Helps smaller brokerages or lenders manage fluctuating loan volumes without carrying extra payroll.
Faster Turn Times
Contract processors often work remotely and are paid per closed file, so they’re incentivized to move loans quickly.
They can push COE requests, follow up on VA appraisals, and ensure VA-specific forms (26-1880, 26-8923) are completed on time.
Compliance & Accuracy
VA has strict guidelines (e.g., allowable fees, seller concessions, and veteran protections).
A skilled processor reduces risk of compliance errors that could lead to loan buybacks or funding delays.
Scalability
During high volume seasons (e.g., rate drops, PCS military moves), lenders can bring on extra processors quickly without long-term HR commitments.
Reduced Loan Officer Burden
Lets LOs focus on originating, networking, and serving clients while the processor handles gathering DD-214s, income docs, pest inspection reports (if required), and underwriting conditions.
Improved Borrower Experience
Veterans and active-duty borrowers often value clear communication and speed.
A processor who knows the VA process can anticipate documentation needs and prevent last-minute surprises.
👉 In short: Contract processors help lenders stay lean, compliant, and efficient, while ensuring veterans have a smoother experience.