What does the term 'loan origination' refer to?

Loan origination refers specifically to the act of processing a mortgage application. This encompasses several steps, including taking the borrower's application, verifying their financial information, underwriting the loan, and ultimately approving or denying the mortgage. This process is essential because it establishes the lender's decision to provide funds for a property purchase, guiding borrowers through what can often be a complex and detailed procedure.

While evaluating a property for value is important in the overall real estate process, it does not encompass loan origination itself, which is focused more on the borrower's financial qualifications and the mortgage details. Similarly, closing a real estate transaction relates to the finalization of the sale, which occurs after loan origination has taken place. The selection of a property by a buyer is another distinct activity, focusing on the buyer's choices rather than the financial processing required to secure financing for that property.