Loan origination is the process by which a borrower applies for a new loan, and a lender processes that application. Origination generally includes all the steps from taking a loan application up to disbursal of funds (or declining the application). Loan servicing covers everything after disbursing the funds until the loan is fully paid off. Loan origination is a specialized version of new account opening for financial services organizations. Certain people and organizations specialize in loan origination. Mortgage brokers and other mortgage originator companies serve as a prominent example.
There are many different types of loans. For more information on loan types, see the loan and consumer lending articles. Steps involved in originating a loan vary by loan type, various kinds of loan risk, regulator, lender policy, and other factors.
Read more about Loan Origination: Application Process, Pricing, Including Risk-based Pricing & Relationship Based Pricing, Loan Specific Compliance Requirements, Cross Selling, Add-on Selling, Appraising Collateral, Funding of Loan, Collateralization & Recording Lien, Regulation
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