After a loan is originated, loan files have to be approved by loan processor. These professionals are responsible to check for all the paperwork and enhance the probability that the loan will be approved.
Loan processors may work for many loan types such as mortgages or consumer loans. Look for candidates with experience related to your own company or for good trainees who can be trained on the job. A license is mandatory for mortgage loan processors.
A loan processor’s skill set matches that of a detective. They should be able to interview potential clients and evaluate applications, looking for red flags, omissions or inconsistencies. The major strengths are sound judgement and attention to detail. Math and communication skills are necessary as they would work closely with loan officers, underwriters and clients. Time-management and working with targets are also important aspects of the job.
Loan processor Operational and Situational questions
- How do you calculate income?
- What methods would you use to analyze credit?
- Imagine you have a busy day, with loan officers and clients calling constantly to inquire about the state of applications. How do you handle the stress? What do you do to ensure excellent customer service?
- How would you approach a demanding loan officer/underwriter?
- What documents would you ask for to begin processing a loan?
As told earlier that A loan processor is a financial professional who prepares documents and inputs financial data to help customers secure loans and mortgages. When appearring for an interview for a loan processor position, it’s important to highlight your technical skills, experience and knowledge.
- How has your education/training prepared you for this job?
- How do you maintain attention to detail?
- What software do you use in this job?
- What useful information do you get from bank statements/credit reports/etc.?
- What are different types of mortgages?
- Explain RESPA
- What’s the highest number of loan files you were processing at the same time in your previous job?
- Share an incident where you discovered a fraud
- Describe a situation you had to multi-task to meet a deadline
- Tell us about the most challenging loan file you dealt with
- Recall a time you took an initiative to complete loan processing faster
- Have you ever faced an ethical dilemma at your job?
- Have you ever helped a client with bad credit secure a loan?
You can help prepare for your next interview by reviewing the common questions hiring managers ask for loan processing positions. In this article, we list common loan processor interview questions and provide sample answers to help you prepare your responses.
General loan processing interview questions
A hiring manager asks general questions to learn more about your personality, interests and work ethic. Some common general questions include:Let employers find you when you create an Indeed Resume
- Tell me about yourself.
- How did you hear about this position?
- Why do you want to work at this company?
- What are your greatest strengths?
- What is a weakness you have?
- Tell me about a time you faced a challenge.
- What are your core values?
- Where do you see yourself in five years?
- What is your proudest achievement?
- Why are you the right person for this role?
Questions about loan processing experience and background
An interviewer may use these questions to evaluate your professional experience and qualifications:
- What led you to pursue a career in loan processing?
- How have your previous positions prepared you for this role?
- What experience do you have with processing loans?
- What are 3 important skills you think a loan processor should have?
- How do you maintain high attention to detail?
- What loan software programs do you have experience with?
- What is your favorite part of being a loan processor?
- What was the most challenging loan application you ever worked on?
- What types of loans do you have the most experience with?
- Have you ever faced an upset client? How did you handle the situation?
In-depth loan processor questions
These questions help an interviewer know more about your technical skills within the mortgage loan industry:
- What strategies do you use to evaluate a client’s credit?
- What documents do you require before processing a loan?
- How would you explain the different types of mortgages to a potential customer?
- What step in the loan processing do you experience the most delays, and how do you work to reduce them?
- What lenders do you have experience with?
- On a scale of one to ten, how comfortable are you with national mortgage guidelines?
- What experience do you have with Desktop Originator?
- What are the minimum credit scores required for a mortgage?
- How many loan files have you processed at one time?
- How do you calculate a client’s income?
Loan processing interview questions with sample answers
Here are some common loan processing interview questions with sample answers. Reading sample answers can help you think of your own scenarios and responses. Consider these questions when preparing for your next loan processor interview:
How do you work to reduce errors in your work?
Attention to detail is an important skill for loan processors. They must review all data carefully and input information to ensure a client’s borrowing information is correct. An interview may ask this question to evaluate your detail-orientation skills and your work ethic. To answer, consider your overall work process and how you review data. After briefly describing your overall process, you can provide a specific example of how you caught an error.
Example: “I created a review system to help reduce errors in the mortgage process. I use loan processing software that flags any unusual numbers. I also have a phone call with clients to review their numbers. This call helps clients understand their numbers and helps me quickly notice any mistakes before the verification process.
In my last role, this process helped me find a mistake before submitting the loan to the underwriter. My client had made a typing mistake when inputting their data in the software. When reviewing the information over the phone, I was able to check with the client and quickly correct the mistake.”
Explain a situation where you successfully collaborated with a mortgage team.
Loan processors often work with other loan professionals, including loan officers and underwriters, to help customers secure mortgages. A hiring manager may ask this question to assess your teamwork and collaboration skills. To answer, think of a time when you worked with others to complete a mortgage application. Try to focus on a time you succeeded or used your teamwork skills to achieve a goal.
Example: “In my last role, I regularly worked as part of a mortgage team. Recently, we faced a tight schedule where a client needed a mortgage as part of a quick closing. I worked with the loan officer to collect the necessary documents and answer the client’s questions. I collaborated with the underwriter to ensure my client’s met all of their demands. In the end, we processed the loan right on time, and the clients closed on their new home.”
How often do you bring in new customers through referrals?
An interviewer may ask about your referral rate, or how many customers refer you to their family and friends, to learn more about your qualifications. A high referral rate may imply that clients had positive interactions with you, which can be a measure of success. Consider answering this question with your referral rate if you know it. If you are unsure of your exact rate, you can answer with a specific story of a time you brought a new client to your last company through a customer referral program.
Example: “Client satisfaction is important to me, so I have tracked my referral rate for the last two years. I ask all new clients to answer a brief survey where they detail how they heard about my services. On average, one out of every five customers I work with is through a referral. In the last year, I gained 16 new clients through referrals.”
How do you manage and prioritize multiple loan applications?
Many loan processors work with multiple loans at the same time. To succeed, they must manage multiple deadlines and work with several clients at once. A hiring manager may ask this question to assess how you handle deadlines or prioritize your tasks. To answer, consider how you plan your day to meet all deadlines. Detail-orientation is a crucial part of being a loan processor, so try to highlight how you maintain quality while meeting deadlines.
Example: “I create a daily schedule for myself to ensure I am meeting all of my deadlines for each loan I work with. In my last role, I handled three loans at the same time. I planned each day using a monthly calendar. I first tracked the major deadlines for each loan, and then I divided these into smaller tasks. I set goals for each week and day to ensure I completed each loan on time. This allowed me to meet my deadlines, while also planning enough time for each task to ensure quality and accuracy. I completed all three loans on time, and I received five-star reviews from the clients.”
How do you explain loan information to a customer?
Loan processors often work closely with customers, and they may need to communicate information or mortgage details. Interviewers can ask this question to assess your communication skills and experience working with customers. To answer, think of a time you explained a mortgage concept for a client.
Example: “I set up an initial phone call to discuss the loan process with customers. I begin by asking them about their loan history. This can help me get a better idea of how comfortable they are with the mortgage process. I leave time for questions. If a customer has a specific question, I have a variety of handouts and graphics I’ve made over the years to explain common concepts. I send the customer a relevant sheet so they can refer to it during the process.
For example, in my most recent role, a customer had a question about the mortgage payments. I have a graphic organizer that divides the payment into sections. I sent this to the customer and called them to talk about all the steps. The customer understood the concept after this call and they thanked me for being so thorough.”
Loan Processor Interview Questions and Answers
What mortgage types did you handle as a loan processor?
This question reveals what kinds of experience he/she is bringing to the table. Someone who has experience as a loan processor has managed a multitude of loan products and understands how each program works. You want to find a candidate who has previous knowledge of each loan product you offer clients. They are seasoned professionals with sales and customer service experience. What to look for in an answer:
xperience processing a variety of loans
Experience verifying application information
Superior customer service skills
“i handled personal, commercial, and mortgage home loans for applicants. I verified their information, calculated financial details to ensure that the loans were affordable and evaluated their credit scores.
What kind of experience do you have with VA mortgage loans?
You want a candidate who knows what to look for when qualifying the borrower for a mortgage. They should also know that the property itself has to meet specific VA regulations and standards before the mortgage is approved. A candidate with knowledge of these steps is a great asset to your company. What to look for in an answer:
Experience with the VA loan process
Knowledge of VA regulations and standards
Helps service members qualify for a mortgage
“I processed VA mortgage loans for military applicants and evaluated their service record to establish eligibility for the loan. Working closely with inspectors and real estate agents, I established that the chosen property met all VA standards and regulations.
What are the minimum credit scores required for approval for home mortgage loans?
This is an important question as it ensures the loan processor candidate can make an adequate judgment based on a client’s credit score. Someone who has experience processing home mortgage loans knows the minimum credit score required for each mortgage loan program. You want a candidate who has enough experience to tell you the exact credit scores as outlined in loan regulations. The candidate should answer the question correctly without hesitation. They should also know about alternative measures to get qualified, such as paying a higher down payment. What to look for in an answer:
- Experience approving or denying mortgages
- Knowledge of qualification requirements for mortgages
- Experience presenting mortgage products to consumers
“The minimum credit score for an FHA mortgage is 580. For a conventional or FHA mortgage, the minimum is 620. Applicants qualify for a conventional or FHA mortgage with a score as low as 500 if they pay at least 20% down for their mortgage.
As a loan processor, under what circumstances would you offer debt consolidation loans?
This question is important to ask as it reveals whether or not the candidate can evaluate the borrower’s current financial status and determine if debt consolidation loans are the right choice. Someone who has experience with debt consolidation loans also understands how the loans work and the circumstances in which they are warranted.They must possess exemplary customer service skills and help the borrower make a well-informed choice about the product. What to look for in an answer:
- Experience with debt consolidation loans
- Knowledge of the loan products
- Can clearly explain why these loans are helpful
“I would offer this option to qualifying applicants who want to pay off their credit card debts quickly. I offered this option to one client who saw the advantage of paying one lump sum as opposed to four different payments with different APRs.
At your previous employment as a loan processor, did you work with auto loans?
Someone who has experience with auto loans understands how to help customers qualify for a new or used car. You want a candidate who understands the best practices for approving auto loans while providing the best option for your customers. They must know how to process auto loans and understand the preliminary eligibility requirements for the loans. The candidate will work well with your sales staff and credit managers if they understand what is expected of them prior to getting hired. What to look for in an answer:
- Experience processing auto loans
- Knowledge of minimum requirements to qualify for an auto loan
- Experience presenting auto loan products to consumers
“Working closely with credit managers and sales personnel, I processed auto loan applications for consumers wanting to purchase a car. I presented loan products and deals to the consumer for which they qualified. The minimum requirements for an auto loan included a monthly income of at least $1,500, a credit score of 550 and verifiable employment.
Tell me about a time you secured a loan for a client with a bad credit rating?
An experienced loan processor will know that a good credit score is a prerequisite for securing most loans. This question can help hiring managers identify candidates who understand the ethics and guidelines of the profession and the internal protocols of their company. A skilled loan processor candidate’s answer will reflect their adherence to the rules and regulations for providing loans to prevent foul play. The candidate’s answer should emphasize:
- In-depth knowledge of the procedures for giving clients loans
“I have only secured a loan for a client with a bad credit twice. In most cases, an excellent credit history allows me to offer loan applicants a wide range of favorable interest rates. But in those two occasions, I was able to find interest rates that were acceptable to the clients and my employer. Before authorizing the applications, I informed my manager and she gave me the go-ahead.”