What Is Mortgage Underwriting?

What is mortgage underwriting? Specifically, it is the process where a lender will analyze the application for a mortgage and either approve it or deny it.

An underwriter will usually consider three important factors in determining the risk and the terms involved with the mortgage. They are collateral, capacity and credit.

What guidelines does mortgage underwriting follow? Lenders will create the specific guidelines that should be followed. In addition, computer programs can help assess whether the mortgage is too much of a risk or not.

Using the tools provided the mortgage underwriter will then make the ultimate decision on whether the loan will be approved or not.

An important aspect of underwriting consists of doing an accurate assessment