The real power behind the throne is the mysterious underwriter. Chances are you'll never even know your underwriter's name - let alone get the chance to sway them on the phone or in person. Play your cards right, and you can increase your chances of loan approval by this "all-important" figure.
As Mortgage Specialists, Alpine Investments & Mortgage offers you the following pointers:
| They're mysterious figures shrouded in secrecy and kept from public contact. Yet mortgage underwriters have the power to say "Yes" or "No" to the purchase of a home. |
Understand the Underwriter's Role.
Most mortgage underwriters are "grown-up" loan processors. They have been in the business for a respectable
five, seven or ten years. As they used to work up cases at the
front end, now they are making the rulings and judgments on the
loan packages that others are now giving to them. The
underwriter's role is to keep its firm from making bad loans that
will sour in the company's portfolio or prove unsellable to
outside investors.
This is called "risk analysis," and many underwriters,
who are detail oriented, take the task very seriously.
Realize that the rules Underwriters use are inherently
flexible.
All use "underwriting guidelines" to decide whether to
approve or deny a loan. Their rule books typically come from the
Federal National Mortgage Association (FNMA), also known as
Fannie Mae, or the Federal Home Loan Mortgage Corp (FHLMC), also
known as Freddie Mac. These organizations buy billions of
dollars' worth of home loans on the secondary market each year.
What do the guidelines cover?
Among other things, they set "ratios" on income versus
debt, define down-payment terms and itemize the documents an
applicant must show to make his file complete.
Do you have problems in your credit history?
Then realize there is some "give" in the system and go
about finding ways to convince your underwriter to make the loan.
| How can you make yourself popular with the staff of a lending office? | |
| Tell the complete truth and provide your information quickly. |
Explain and Document any financial problems in your
background.
Even though you will never meet the underwriter, you have a shot
at influencing them via your Loan Officer, using statements and
documents.
Did your credit take a hit after you took unpaid leave to help
your mother recover from a car accident?
Type up a statement explaining this and attach copies of your
mother's medical bills.
Is your income a little less than you need to qualify, yet
you're due for a pay increase in just a couple of months?
Ask your boss for a letter to this effect on company letter-head
.
Never submit fake documents to support your loan
application.
Underwriters are trained in the art of fraud detection. They can
easily spot a fake W-2 or falsified employer verification form.
They can also see the red flag signaling problems that are hidden
in bank statements and tax returns.
Besides being un-ethical, you're just plain screwed from the
beginning; the cardinal rule of mortgage lending requires an
underwriter to automatically disapprove any file that involves
fraud.
Win the affections of your Loan Representative and
Processor.
They could help you with the underwriter.
To guard against bias, some lending firms deliberately keep their
underwriters in offices miles away from other company employees.
But chances are good that your underwriter works
"shoulder-to-shoulder" with those you are able to meet;
whether through the same lending institution or a Mortgage
Broker.
In these situations, your loan rep and processor could be
especially influential. In borderline cases, they may even go to
the extent of writing a letter to promote the chances of your
file being approved.