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Established Contributor
jordanmedical
Posts: 1,011
Registered: ‎04-08-2012

What really happens in UW?

Do they just review the file or make phone calls or run numbers? (this may be a stupid question so forgive me)

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Starting Score: 492-TU04, 480-EX FICO V2, 467-EQ Beacon 5 (Via Mortgage PreQual March '12)
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Frequent Contributor
MrChairman
Posts: 456
Registered: ‎02-07-2010

Re: What really happens in UW?

In the underwriting process, everything you submitted to the LO is verified. From income taxes to your job to your actual debts. It's the UW department's job to verify all the information you gave them. They also see how much house you can truley afford based on your income.


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Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: What really happens in UW?

+1, A lot of folks go through Desktop Underwriting first, which is where a computer decides if you are preapproved or not. DU uses your paystubs, W2s, bank statements, and tax returns that you provided and those are entered into the system. If preapproved, you sign a whole bunch of disclosures and provide them back to the LO along with your signed application and the LO sends it to the loan processor after the committee conditionally approves or denies. If conditionally approved, you go back and forth with the loan processor to satisfy the conditions required by the committee for approval. At this time, your appraisal comes back and you have to review it and sign a form acknowledging you received it. Within those conditions are explanations and verifications as StartingOver said (you will most likely have to provide explanations to the LO as well before your file begins loan processing). Once they have all of your paperwork together, your file goes to the UW for review...you may get a verification phone call here or there, but this is the time when people begin to bite their nails and wait for cleared to close.
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Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: What really happens in UW?

Whoops, what MrChairman said, not SO10. Sorry.
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Valued Contributor
JM-AM
Posts: 3,303
Registered: ‎06-09-2010

Re: What really happens in UW?

Technically any good office you deal with LO or Broker should have your file complete. The processor in the office does most of the work before submitting file to UW.

A good processor knows if you will have bumps in your file and will address them with you before file is submitted.

The UW receives the file and confirms everything again. If the processor performed their job properly, the UW process is much faster.

A UW is technically an advanced processor. They know the requurements and overlays according to their Lenders they work for.
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Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: What really happens in UW?

Yes my LO underestimated some info I provided and because of that, he didn't ask for a lot of the paperwork the loan processor wanted up front. That was very frustrating as that delayed my loan from closing at the end of this month. My LO said that they were processing a lot of loan apps so my guess is they wanted to get them into processing at soon as possible and work out the kinks later.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014
Established Contributor
jordanmedical
Posts: 1,011
Registered: ‎04-08-2012

Re: What really happens in UW?

[ Edited ]

So they just verify your file and make sure it meets pre-set guidelines? If you have a C/O that was paid, how do they go about verifying something like that. (Curious because I think this may delay things). Will an UW call you to have you contact a company and provide a letter in this case?

 

 

Also, will VOR need to be done if my prop management reports to my CR? (Just trying to prepare myself for the future as I read most UW delay are due to waiting on a buyer providing files)

-Rebuilding with CapOne Cash: $1.5k, NFCU cashRewards $8.5K, NavCheck $5K, Wal-Mart: $1.1K, Sam's: $1.2K, Amazon: $1.9K, Apple Barclay: $3K, Haverty's: $1.5K, GE capital: $5K, Sears: $250(AU), PP MC:$1.5K, CareCredit:$3K (closed 1st home 05/08/13)
Starting Score: 492-TU04, 480-EX FICO V2, 467-EQ Beacon 5 (Via Mortgage PreQual March '12)
Current Score: EX,EQ,TU (lender pull): 652, 659, 689, Walmart TU FICO: 691 (05/13)
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New Contributor
slappymancuso
Posts: 167
Registered: ‎12-04-2012

Re: What really happens in UW?

Pretty much +1 to everything said here.  I just wanted to chime in so I could share a quote from an IRS agent I was speaking with the other day:

 

"Most underwriters are dumber than rocks."

 

Maybe that's a little harsh.  They're doing their job, and they're frequently the source of frustration for homebuyers.  It's their job to weed out anyone who is not likely to repay the loan in full.  I have been told they'd rather decline ten good loans than accept one bad loan.  Considering the housing market crash you don't have to wonder too terribly hard at why.  Their job is to dig into anyone listed on a loan to be sure that they are not hiding something or misrepresenting themselves in any way.

 

To quote DallasLoanGuy, who is in the industry and extremely knowledgeable on all things mortgage, Underwriters will sometimes ask for things that do not exist or cannot be provided.  If they do ask you for something you cannot get simply try and then let your LO or broker know.  I was asked to have the IRS write a blasted letter explaining I didn't owe any taxes despite that transcripts all indicate as much.  Yeah, right.  They aren't going to write anything special for anyone unless they owe some money.  After trying on the phone and at a local office, I simply wrote a letter describing my attempts.  Underwriter was then satisfied with that one.

 

I really think they just try and make you jump through a few hoops.  I can imagine, in some circumstances, they uncover additional issues by doing this, but you will be fine.  If your credit score is well above the minimum I wouldn't be surprised if they don't even follow up on the C/O unless it was in the past year or so.  I had one from 2006 that they never even asked about.  Our rental company does not report to our credit, so we weren't asked for anything like that.  I have heard that when they do want it they'll want it sent directly to and from your rental company.  So long as your leasing office is responsive I would think you can turn that around on the same day provided it is an issue.

 

Good luck!  Don't let underwriting get to you.  If they ask for something that you are unable to get simply let them know.  A good LO will level with you when their requests are unrealistic, and just trying to get them what they ask for will go a long way.

Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: What really happens in UW?

+1
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014
Established Contributor
jordanmedical
Posts: 1,011
Registered: ‎04-08-2012

Re: What really happens in UW?

[ Edited ]

Great post slappy.

-Rebuilding with CapOne Cash: $1.5k, NFCU cashRewards $8.5K, NavCheck $5K, Wal-Mart: $1.1K, Sam's: $1.2K, Amazon: $1.9K, Apple Barclay: $3K, Haverty's: $1.5K, GE capital: $5K, Sears: $250(AU), PP MC:$1.5K, CareCredit:$3K (closed 1st home 05/08/13)
Starting Score: 492-TU04, 480-EX FICO V2, 467-EQ Beacon 5 (Via Mortgage PreQual March '12)
Current Score: EX,EQ,TU (lender pull): 652, 659, 689, Walmart TU FICO: 691 (05/13)
Goal Score: 700

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