Approved via DU, now what?

[Anonymous]

Ok. So I got an automated approval via DU. He then said he was going to send it to underwriting. My thing is, why is it sent to underwriting if it’s already approved via DU. Is it just to verify everything? I have an excluded disputed item based on FHA guidelines. I’m just hoping the underwriter doesn’t challenge the DU findings. All my paperwork matches.

Another question. I got approved with 5K in fundings; however, the seller is contributing enough to cover closing. Will I still need the gifted funds of down payment and closing is covered from both myself and the seller? I’m trying to figure out a way to tell my family member that I still need the gifted funds even though the seller is covering it. They might not understand why I still need it.

Thanks
I’m a nervous wreck and closing in 22 days (record time) so I’m anxious about underwriting, last minute credit checks, etc

[Anonymous]

Automated approval is a good step but underwriting is where the real approval will come from. Did you get your conditions yet? That will help you figure out what you might need to do to close. Good luck!

[pgtackle2003]

A lot more information to cover here in order to help you. You mentioned FHA, so I assume you were approved for 3.5% down? It seems perhaps you might not understand that closing costs and down payment are completely separate things. The seller will pay closing costs but you are still responsible for the 3.5% down payment. So yes you would still need the funds. DU simply checks your credit score meets the minimum requirements.

An underwriter does not "challenge" DU findings so to speak, they just need to do things a DU system cannot. This is things such as verifying your income source, verifying your down payment funds, looking through bank statements to make sure there are no other debts you didn't specify. So as the other poster mentioned getting approved through DU is a great first step but there will be other things that need verified to be fully approved.

Good luck!