What is mortgage loan underwriting process?

Whenever we go to get a loan be it housing or personal loan the bankers talk about underwriting that it will take some time for underwriting process etc. So, have you ever asked the question what is this underwriting? Here is an opportunity for you to learn that.

What is underwriting?

Mortgage underwriter generally a third party who is appointed by the bank to assess the borrowers' creditworthiness, the ability to pay back the loan and how much loan amount you are eligible. This is one of the reasons why your loan takes some time to be disbursed. There is no timeframe for when this process will be done. It depends on how much time is available for the underwriter. It is a risky job on the part of the underwriter and hence will be very thorough in their assessment and verification.

Mortgage underwriting for home loans 

A home loan is a loan offered to customers to help them buy their dream homes. The underwriter here will verify the risk the lender will take on providing you with a home loan. For their assessment the underwriter takes into consideration the following factors

1.    Salary: Your salary is reviewed by the underwriter where the work you do, the company you work for, the salary you earn, the length of your employment and the scope of advancement in your job. All this is taken into consideration to determine your loan eligibility.

2.    Other debts and liabilities: The underwriter will check your other debts and liabilities by accessing your credit score and credit report. The underwriter will get a very good idea and details about your debts and your payment history of debts from your credit report. If you had any defaults on payment even once will be taken into consideration.

3.     Marital status: Your marital status and if you have children, if your spouse is working and their jobs will also be under scrutiny if they are a joint applicant.

4.    Other verifications: First the underwriter verifies if all the information you have provided on your application form. They will contact your place of work to verify if you really do work there as well as if your designation and if possible, salary also match. They will also check your address phone number etc.

5.     Home appraisal: This is the stage where the underwriter assesses the home you are going to buy. They will scrutinize every inch of the property documentation, the property history to make sure no one else has the claim on the property and also see if the property price tag is right comparing it with similar properties. This whole process is called home or property appraisal, which done to make sure the bank does not get into any trouble and there are no surprises.

Once all this is done to the satisfactory of the underwriter, your loan will be approved and money disbursed to you.

Mortgage underwriting for personal loans

A personal loan is a loan provided to customers for their varied needs like marriage, home renovation, car payment etc. The personal loans underwriting will also follow the same process except for the part of home appraisal as the loan is an unsecured one and the documentation and verification process for salary and job will be the same.


To make sure your loan does not get rejected at the time of underwriting make sure the details you provide are accurate. Check your credit score and credit history before applying for a loan and if you have any negative marks you need to clear them. By taking these steps, you can get over this hurdle easily.