Mortgage Loan Underwriting Jobs
A mortgage loan underwriter reviews mortgage loan applications in their entirety and makes a recommendation that the financial institution accepts the application and grants the loan, denies it, or put it in a pending file until more information is received.
The underwriter looks through all of the information in the loan application package to determine whether the borrowers are a good credit risk, whether they have the money for the down payment, whether their credit report reflects a willingness to pay their debts, and whether the property value is accurate and in line with desired loans for the bank. There are many reports and information that go into each mortgage loan application, including the borrowers’ employment and salary information, their credit reports, appraisals on the home, and their checking and savings accounts balances and histories.
Underwriting standards will vary from bank to bank, depending in the number and types of loans the bank wishes to have in their portfolios. For example, some banks require the borrower to pay a down payment of 20 percent of the sale price of the home, while others require 15 percent or less. Some banks may require self-employed individuals supply five years of tax returns to prove steady income, while others may require less. Underwriters must look at the complete loan package and make a recommendation for the bank. If loans default and go into foreclosure, banks lose money. The goal is to accept loan packages with the least risk involved. Underwriters must be able to analyze the borrowers’ information and make that judgment call.
Underwriters typically do not have direct contact with the borrowers. If more information is needed it is usually the mortgage loan processor or originator who contacts the borrower to obtain it. Underwriters do work as a team in conjunction with processors and originators so that the entire loan application process can flow smoothly.
Some underwriters may work for banks or lending institutions that focus on particular types of loans, such as FHA, VA, etc. These loans may require that the underwriter be certified to work on them.
If you enjoy problem-solving, analysis, and detail work, this may be an attractive career choice for you.
The future outlook of mortgage loan underwriter jobs is unknown. There will always be the need for underwriters, but how much growth, if any, there will be in the number of jobs is not known. Openings may be limited to people retiring, getting promotions, and similar reasons.
Most banks do not require their underwriters to have a college degree, but candidates with college degrees are preferred. A degree in finance, accounting, or economics is helpful. Certifications for certain types of mortgage loans may be required. You should check with the lending institution you are interested in working for to determine whether you will need to acquire certification.
If you do not have a college degree, most banks look for underwriters who have a minimum of two years of previous underwriting experience or five years of mortgage loan processing experience.
Knowledge, Skills, and Abilities
Mortgage loan underwriters must have the ability to analyze a lot of data in a loan package. They should have a solid working knowledge of federal and state mandated consumer disclosure requirements. If the underwriter will be working on FHA, VA, and other kinds of loans he or she must have good working knowledge of all the loan requirements and guidelines specific to these loans. Underwriters must be capable of interpreting and applying required policies, procedures and guidelines with minimal supervision.
In addition, underwriters need to be sensitive to the confidential information they receive about each borrower. They should have excellent analytical, communication, organizational, and time management skills. They should be able to work as part of a team. Mortgage loan work can be fast-paced so underwriters should be able to work quickly yet thoroughly, and under pressure.
Mortgage loan underwriters earn a wide range of salaries, depending on the bank, number of years of experience, and the location of the bank. Underwriters can earn an average annual salary of between $36,000 to $57,000 in the Midwest. On the west coast underwriters earn between $41,000 and $64,000, and in New York City the average salary range is $43,000 to $67,000.
Potential Career Paths
Mortgage loan underwriters can advance their careers by obtaining underwriting positions with larger banks or lending institutions. He or she can also become a supervisor, overseeing several underwriters, or a manager of the underwriting department. Additionally, the mortgage loan underwriter may choose to become an originator. Management and originator positions may require a college degree.