Posted on: 27th Feb, 2009 03:56 am
Mortgage underwriting & overwriting
mortgage underwriting is the review and decision-making process that allows a lender to approve or deny a loan request.
overwriting? i have no clue why this would come up in relation to mortgage lending. it's never been used in my vast years of experience.
overwriting? i have no clue why this would come up in relation to mortgage lending. it's never been used in my vast years of experience.
Hheeh.. Lately i've seen a lot of what I would consider "overwriting" from underwriting :)
yuk yuk chris...i have to tell you. i underwrote for 10 years as a contractor for united guaranty, and that, of course, included the transition from 100% A paper to alt-a loans and all that mess (not included sub-prime, which i never handled). things have changed so radically that it's virtually impossible to believe.
i was a common-sense underwriter in the full sense of the term. nowadays, common sense means that (it appears) you can't even rely on guidelines.
this happened last week: i have a borrower who completed Chapter 13 in the fall of 2007 - would have been approved a year ago on a loan i had in process but made a late payment on an investment property mortgage at the wrong time. okay, i digressed...i told her let's wait a year and have that 30-day late be a year old...so here we go with a new application - we are now 15-16 months out of Ch. 13; score is 611 and ratios are quite good.
du, naturally, gives me a refer/eligible because of the bankruptcy. oh yeah...i'm doing fha, which allows 1 year out of Ch. 13. underwriter tells me she doesn't like bankruptcy and asks for an explanation letter. letter comes in (very strong) and she hands the file back to me yesterday, telling me that manual underwrites now require a score of 620.
so here we are back to the drawing board, looking for 9 lousy points on my borrower's score. maybe april 1...maybe may 1...she wants to buy a house...i need a loan...oh well.
thanks for listening - it's therapeutic once in a while to vent like this. and yes, underwriting is unlike it's ever been before - even back when 28/36 ratios were king.
i was a common-sense underwriter in the full sense of the term. nowadays, common sense means that (it appears) you can't even rely on guidelines.
this happened last week: i have a borrower who completed Chapter 13 in the fall of 2007 - would have been approved a year ago on a loan i had in process but made a late payment on an investment property mortgage at the wrong time. okay, i digressed...i told her let's wait a year and have that 30-day late be a year old...so here we go with a new application - we are now 15-16 months out of Ch. 13; score is 611 and ratios are quite good.
du, naturally, gives me a refer/eligible because of the bankruptcy. oh yeah...i'm doing fha, which allows 1 year out of Ch. 13. underwriter tells me she doesn't like bankruptcy and asks for an explanation letter. letter comes in (very strong) and she hands the file back to me yesterday, telling me that manual underwrites now require a score of 620.
so here we are back to the drawing board, looking for 9 lousy points on my borrower's score. maybe april 1...maybe may 1...she wants to buy a house...i need a loan...oh well.
thanks for listening - it's therapeutic once in a while to vent like this. and yes, underwriting is unlike it's ever been before - even back when 28/36 ratios were king.
I'm so sorry to hear about your situation. I have several that are similar. including great credit borrowers being treated as second class citizens for the smallest of small details.
I'm not sure if it's their attempt to remove brokers from the marketplace or if any sense of level headedness is completely gone from the lending side of things for the time being.
Hand in there, we are in it together!
I'm not sure if it's their attempt to remove brokers from the marketplace or if any sense of level headedness is completely gone from the lending side of things for the time being.
Hand in there, we are in it together!
thanks for the sympathy, guest. i am not a broker...i'm with a direct lender...so weeding out brokers is not the question here.
it's the level-headedness that's lacking. but of course if i'd remained a contract underwriter i might have been laid off 14 times in the last 2 years.
it's the level-headedness that's lacking. but of course if i'd remained a contract underwriter i might have been laid off 14 times in the last 2 years.
oh wait...that might not be so bad...i'd at least be able to collect unemployment compensation.