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We study how the organization of screening activity---and its endogenous response to economic and technological forces---affects informational efficiency, credit allocation, and the distribution of borrower risk. Using US administrative data linking loan officers to mortgage applications and loan performance, we document that local officers achieve higher screening precision and faster processing; the informational benefits of proximity accrue disproportionately to borrowers with higher observable risk; and lenders allocate labor elastically with respect to local wages, resulting in systematic spatial misallocation of underwriting capacity relative to mortgage demand. We develop and estimate a structural model in which lenders set prices before observing borrower-specific signals, borrowers self-select on posted rates, and loan officers of different screening precision generate information that determines loan approvals. Lenders compete in mortgage pricing and in labor markets for local and remote officers, endogenously allocating information production across markets. We find substantial baseline credit rationing—up to 15 percent in high-risk segments—with local officers eliminating roughly half of it while also reducing excessively risky approvals. A technology shock that raises the processing productivity of remote officers induces lenders to substitute away from local screening, lowering informational efficiency, increasing excessively risky approvals and expected defaults, and tightening rationing for marginal borrowers despite only modest reductions in interest rates.