Underwriting is the process of verifying that the requested loan, the borrower(s), the property, and the documentation all meet the requirements of the lender for the program requested. The underwriter will examine the credit and income of the borrower(s) to determine the ability and willingness to repay the loan. They will review the appraisal to determine the value and condition of the collateral. The title is examined to ensure the proper lien position is obtained by the lender. The identification of the borrowers and property owners is verified. The underwriting process has been put in place to help protect all of the parties involved in the transaction.
The length of the underwriting process may be as short as a day or may take several weeks. Many factors influence the length of time a file may be in underwriting: 1) How busy is the lender? 2) How complete is the file? 3) How complex is the file? 4) How experienced is the underwriter?