Underwriting In The Mortgage Process, Explained

Dec 23, 2024

6-minute read

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A charming row of houses with a white picket fence, creating a picturesque neighborhood scene.

If you’re on your way to securing a mortgage to purchase a home, one step you’ll inevitably come across is underwriting. The underwriting component is crucial to understand because it dictates whether you’ll get final loan approval.

And without this approval, you won’t be able to move forward with a home purchase – which, of course, is the goal.


What Is Underwriting?

Underwriting is the process of your lender verifying details about you and your financial situation before issuing a definitive sign-off on your loan application. An underwriter, who’s an employee of the mortgage lender, will take a close look at your income, assets, debt, credit report and property details.

Underwriting happens behind the scenes, but that doesn’t mean you won’t be involved. Your lender may ask for additional documents, such as proof of assets or answers to an underwriter’s questions. These questions might pertain to the origin of bank deposits that the lender flagged for further review.

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