Definition
Underwriting is the process where a lender verifies your financial information and the property's value before approving a loan. The underwriter makes sure you meet all the loan requirements.
Understanding Mortgage Underwriting
After you submit your mortgage application, underwriting begins. It's where lenders review your financial details to decide on the loan. In simple terms, underwriters look at your income, credit score, and debt to ensure you can repay the loan. Example: If you earn $5,000 monthly and have a $500 car payment, they check if the mortgage fits comfortably into your budget. It's not a personal judgment or a guarantee of loan approval. The goal is to match you with a loan that's right for your situation.
