Mortgage Underwriting

Do you know your credit score? Do you think you have good credit or bad credit? Have you checked your credit report in the last 12 months? Do you know what negative items are on your credit report? These are important questions that need good answers before entering into the mortgage underwriting
process – to avoid any unwanted curve balls to obtaining your loan.

A mortgage underwriter (the person who approves the loan) will look at a number of factors before approving a loan, but your credit score is going to be one of the key factors influencing the decision.

The Mortgage Underwriting Process can take 1 day or up to 2 weeks, depending on current market activity. If your underwriter uses an automated underwriting process, then you could get your approval more quickly. However, the drawback of automated underwriting is that a person does NOT make the approval decision – a computer does. If you need more human intervention and “understanding” into your credit history and ability to make your loan payments, automated underwriting may not be the way to go.

Besides your credit report, an underwriter will also look at the following criteria to determine not only if they will extend a loan to you, but also what your interest rate will be:

1. Income
2. Debt
3. Savings
4. Debt-to-Income Ratios
5. Down Payment Amount
6. Ability to Pay Closing costs
7. Job Stability
8. A Satisfactory Credit Management Performance History

It is important to provide all of the above types of information to your underwriter as quickly as possible. The faster they get the information, the faster your loan can be approved. Assuming the loan is approved, you can then set a closing date for the purchase of your home. Be sure to become familiar with all closing paperwork on your new home before you get to the closing date. This will ensure a smooth closing process.

Once you have gone through the closing process, you can then move into your new home!

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