Appendix: Understanding Loan Stages

Stage Types

There are two types of stages that can be present in a program, Critical Stage and Workflow Stage.

• Critical stage: These are stages through which all loans in all programs must pass. Critical stages are determined by the agency during system setup and are automatically added to a set when a new Effective Date is created.
• Workflow stage: These stages affect only loans reserved under the specific program and can be added to programs individually. These do not show up in the Pipeline.

In this document we only focus on the stages which show up in the Pipeline.

Critical Loan Stages

There are six critical stages through which a loan must pass.  

• Reservation: This is where the loan begins. All new loans are immediately moved to this stage. The allocated funding is determined at this stage.
• Underwriting: This is the initial purchase approval stage for the loan, and it's where the underwriting personnel review the loan.
• Compliance: This is a continuation of the purchase approval process. This is where any special documentation for the program is reviewed prior to purchase. Loan data and documentation should all be re-checked at this point.
• Purchase: At this stage the system closes the loan, and the loan servicing process begins. If the agency will keep this loan in their portfolio, then this is the final stage handled by the Single Family system.  If the loan will not be serviced by the agency, then the loan is put in a pool of loans to be sold to investors.
• Pooled: This is where the loan is pooled. The system will move the loan to this stage once all the purchase requirements have been met, and if the loan is to be sold to investors as part of a pool of loans.
• Sold to Trustee: This is when the loan leaves the agency's portfolio. At this point the loan has been pooled and sold to an investor.