What Exactly Does An Underwriter Do With Your Mortgage?

So, what does an underwriter do? Getting your loan underwritten can be terrifying. We’ll cover how you can make the underwriting process less stressful, faster, and easier!

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0:00 What you’ll learn
0:40 Overview of underwriting
5:08 Who actually approves your loan?
6:30 The 2 rounds of underwriting
8:12 How to handle documents
10:11 What NOT to do
11:00 CalmMoment
12:15 Using a shared folder
13:12 Blood samples
14:17 How long it takes
15:23 Steps to buy a home

Hey, Kyle here with winthehouseyoulove.com. Today were talking about what does an underwriter do exactly for your loan? So you’re going to learn three things. Number one, why underwriting determines the fate of your loan. Number two, how to make underwriting easier and number three, how long it takes and the things that you can do to speed up the underwriting process so you can get in your home quicker. This is all about. Making the home buying process, less stressful and helping you go through it as quickly as possible because getting a loan isn’t super fun. We want it to be a joyful process to buy a house. So we’re going to talk about how you can ease this process up.
So first let’s talk about a quick overview. All right. So let’s look up here really quickly. Think of it like a three stage process for underwriting. So underwriting, a basic definition of what underwriting is, is the lender needs to verify your information, to make sure that you can pay back a loan. All right.
They need to make sure that if they’re going to lend you $200,000, that you have a high probability of paying back that $200,000, they don’t want to lose that money. So there’s, kind of a three-step underwriting process. Number one, you have a computer approval. So most loans are underwritten with computer software.
So the computer is first going to issue an approval based on the data that you put in, in your loan application. Then in step two the underwriter is then going to verify the information that was put into the computer program. Now, this has done in two stages that we’ll talk about here, about three fourths through this video, and then number three, your loan is approved.
So the computer verified your information, then an actual person, actual human reviews your information, and then your loan is finally approved. So let’s talk about AUS. AUS stands for Automated Underwriting Software. And this is a software that’s going to take all the information from your loan application, and it’s going to compare it to hundreds if not thousands of mortgage guidelines, mortgage guidelines are just filled with tons of different rules on what qualifies you for a mortgage and certain limitations and documentation that you need for specific scenarios. It can be really obnoxious, like some mortgage guidelines are 1,500+ pages.
So, what AUS is doing is it’s taking the information from your loan application and it is now comparing it to guidelines. All right. And then what it’s going to do is it’s going to give you an approval or denial recommendation. So the software, the guideline software, is now going to compare the information that you put in on your loan application and say, hey, we think this fits all of the guidelines.
So after the underwriting software says, hey, this fits the guidelines, then an actual human has to review that information because here’s what happens is on your loan application. You might put in that you make $50,000 per year. That’s great. But the computer can’t tell if you actually make $50,000 per year or not, the underwriter has to actually look at your pay stubs, W2’s, maybe tax returns to see, do you actually make $50,000? And if so, they will green light basically what that underwriting software is saying so you can get a final loan approval. So the underwriter is going to check over your income, your employment history, credit, and debt to income ratio the appraisal, the money that you have for your down payment and then title, insurance, I have appraisal in here as well, but they’re going to check the property to make sure that it meets lending guidelines. So you can see you have this kind of two phase approach of looking at these guidelines. So you have these big organizations are these big entities that are setting up these rules.
So you have people like Fannie Mae, Freddie Mac, FHA, VA, USDA, they’re setting the guidelines.

— Legal —

Kyle Seagraves
NMLS# 1701021
Motto Mortgage Alliance
8900 N. Dixie Dr.
Dayton, OH 45414
Equal Housing Opportunity


25 thoughts on “What Exactly Does An Underwriter Do With Your Mortgage?”

  1. Thank you my loan is now going through underwriter but my problem is my loan person does not talk to me honestly I feel I can walk away from this to frustrate with the process

  2. Thank you for responding to my message last time….just got into the underwriting process today….crossing my fingers that everything will go smoothly…Thanks Kyle .First time home buyer here…I’ve watch your videos and learning a lot..

  3. Happy to have found this important information. I have a better understanding of conditional approval to initial approval to 2nd round with underwriting. Hopefully to close tomorrow!

  4. Can I buy a cruise ticket if I’m in the middle of buying a house? I plan on using my debit card.

  5. It took almost 4 weeks for my underwriter to approve our loan, is that a common time span? I feel like it took way too long and we had provided all of our documents

  6. Could you explain what they're looking at? For an example, I use FB pay to pay coworkers, friends, family if I buy things from them. Why do they want letter or document of clarification for these things? Just wondering

  7. So besides the 3 credit bureaus, what other sites do underwriters pull from? I know one is Lexisnexis. Are there any others?

  8. What are the odds i get denied during underwriting? All my assets and credit are exactly the same since i've gotten pre approved. I'm so anxious

  9. I’m in the underwriting process still haven’t heard from them. Should I continue to pay off my debt even in full?

  10. Glad I saw your video. I have a question. Found a home submitted documents went under contract..everything was ok then lender notified me that there was a judgement from years ago that I knew nothing about because it never showed up on my credit report. I dont think application went to underwriting yet.. should I be worried that I wont get the loan approved? I'm still waiting to hear something because that means if I have to wait the seller may back out.. and the home is a foreclosure.. what's your opinion on this situation

  11. Your tone and at the pace you speak is perfect. Some people rush as if something is pursuing them

  12. What is loan commitment ? Does it require an appraisal? What’s the difference between approve/eligible and loan commitment? Thanks

  13. My loan is currently with the underwriter and my loan Officer told me in order to get approve, I need to pay off the 2 car loans on my credit report at closing. Is this logical? Please advise. Thanks

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