Many borrowers hear the term “underwriting,” but aren’t sure what an underwriter actually does.
Simply put, the underwriter is the person responsible for reviewing your loan to determine whether it meets the lender’s guidelines and can be approved.
Think of the underwriter as the final reviewer who carefully evaluates your financial information before your loan receives final approval.
What Does an Underwriter Review?
An underwriter reviews many aspects of your loan, including:
- Your income and employment.
- Your credit history.
- Your assets and bank statements.
- Your debt-to-income ratio.
- The property appraisal.
- The purchase contract (if applicable).
- Any additional documentation needed to support your loan.
Their goal is to verify that the information in your loan file is accurate and that the loan meets the requirements of the loan program.
Why Does the Underwriter Ask for More Documents?
One of the most common questions borrowers ask is:
“Why are they asking for more paperwork?”
In most cases, the underwriter simply needs additional documentation to verify information or satisfy lending guidelines. It doesn’t necessarily mean there’s a problem with your loan.
Providing requested documents promptly can help keep your loan moving forward.
Does the Underwriter Make the Final Decision?
Yes.
The underwriter has the authority to:
- Approve your loan.
- Approve your loan with conditions.
- Request additional documentation.
- Decline the loan if it doesn’t meet lending guidelines.
Many loans receive a conditional approval, meaning a few remaining items must be provided before the loan can receive final approval.
My Advice
Underwriters aren’t trying to make the loan process difficult—they’re responsible for ensuring every loan meets the required lending guidelines. Responding quickly to documentation requests and maintaining open communication with your loan officer can help make the underwriting process as smooth as possible.
At Western Ohio Mortgage, our loan officers, processors, and in-house underwriters work closely together to help keep your loan moving forward while maintaining clear communication throughout the process.