Recent Developments in Secondary Market Loan Quality Control

Financial institutions selling loans to the secondary market are required to have a loan quality control (QC) program to monitor and evaluate the integrity of the loan origination and underwriting processes and to provide feedback to management on originations so appropriate action can be taken if issues are uncovered. In today’s environment with its renewed emphasis on the quality of a financial institution’s loans, a robust quality control function is more important than ever. Ensuring quality begins even before an application is taken and must continue throughout the processing, underwriting, and closing functions.

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