The writer is a mortgage broker Vancouver BC. Mortgages with bad credit is a specialty of the writer. Bad credit mortgage lenders use mortgage brokers to place business with clients.
Many segments in the American economy use the term underwriting to describe the process of analyzing information relating to risk and making a decision whether to accept that risk. Life and hazard insurance underwriting is an example of this risk analysis. In real estate, the purpose of an underwriting review is to analyze the features of the mortgage application, determine whether the cumulative risk is acceptable to the lender and falls within its lending guidelines, and establish the final conditions under which the lender will approve, deny, or make a counteroffer to the application.
Underwriting is an integral part of the mortgage-lending process, regardless of the type of transaction, loan product, borrower, or property involved. It follows a similar process for all different types of residential mortgage loans—conventional or government loans, or those loans intended to be sold or placed in portfolio. Any differences are more procedural and not of great significance.
Today, many lenders have turned to automated underwriting (AU) for an underwriting decision. An automated underwriting system, such as Fannie Mae’s Desktop Underwriter, determines the creditworthiness of an applicant by assigning points to certain attributes and facts. These complex software programs use an enormous loan performance database for the basis of their calculations and analysis. AU is discussed later in this chapter.
This chapter first examines the underlying issues and risks, explains the practical steps involved in underwriting a residential mortgage loan, and reviews how underwriting has evolved and is practiced today.
BC mortgage observations are the writer’s passion. Vancouver real estate and Vancouver mortgage BC news is his focus. His insight as TMG Vancouver mortgage broker is reflected in his observations of the North Vancouver, Surrey, Langley, Burnaby, Coquitlam, Maple Ridge mortgage scene.