The Importance of an Experienced Underwriter
For every borrower there is a lender and for every
collateral there is a loan. The mortgage industry collectively offers a wide
variety of loan programs in order to match the broad-spectrum of borrowers and
collateral; from the “hard to qualify for” low rate conventional loans, all the
way to Shakespeare’s “pound of flesh” moneylender Shylock.
Nothing exemplifies better the tradeoff of “Risk-Reward”
like the mortgage industry. Borrowers with excellent credit, great collateral,
lots of capital and income, will get the best loans at the lowest rates. In
short, those who don’t need a loan make the best borrowers. Borrowers with
terrible credit, awful collateral and no money or income will need to ask their
uncle Vinny for a loan.
Account Executives, Loan Originators and Mortgage Brokers
will vet a loans scenario and try to match the borrower and collateral with the
right lender and loan program. However, it is not until the Mortgage
Underwriter gets involved that the reality of whether or not the borrower and
collateral qualify for a specific loan is determined.
The more experienced the Account Executives, Loan
Originators or Mortgage Brokers, the more accurately they can match the
borrower and collateral to the lender and loan program. By the same token, the
more experienced the Mortgage Underwriters the more ways they can find to get
your loan approved.
The primary function of a Mortgage Underwriter is to assess
risk. But, some institutional Mortgage Underwriters as well as some
inexperienced Mortgage Underwriters, function more as a fact checkers than a
risk assessor. These underwriters will have a checklist of parameters to see if
the loan meets a fixed set of lending criteria and will issue an approval or
disapproval based on this checklist. If everything checks out the answer is
Yes, if there is something wrong the answer is No.
On the other hand, an experienced Mortgage Underwriter will
not only find what is wrong with a given loan scenario, but will also be able
to determine if there are any mitigating factors that will offset this negative
item. Or, more importantly, in some cases, the Mortgage Underwriter will be
able to help the borrower correct these issues altogether to get the loan approved.
If, however, the loan is still disapproved, an experiences Mortgage
Underwriter, having already reviewed your file, can point out what the issues
are and who, if any, may be a fit for your loan scenario.
If you are having problems getting your loan approved, ask
to see if another underwriter can take a look at your file. A new set of eyes
could make the difference.