How Mortgage Underwriting Can Screw Up Your Life

Most people – that is, most home buyers and home sellers – have never heard of mortgage underwriting.  The only person most people know is the person they talk to about getting the mortgage.  That would be the loan officer.

Whether they work for a bank, a credit union or some other financial institution, these loan officers are all about trying to get you a mortgage.  More often than not, they get a commission or bonus, just like your Realtor, when the loan is funded and closed and the new home buyer (borrower to the mortgage industry) has signed all the paperwork at the settlement table.

So, the loan officer is usually on your side.  Don’t get me wrong.  They won’t and can’t get you a mortgage you can’t afford (not anymore).  It’s not in their interest and it’s a lot harder to do nowadays.  But they are in the “I wanna lend money for mortgages” mindset.

The “Underbelly” Of The Mortgage Industry

Underwriters, on the other hand, get paid an hourly wage.  For the most part, these folks who have total and complete control over whether or not you get a mortgage:

  • don’t care about you or your mortgage or your dreams for the future
  • don’t work on weekends, holidays, sick days, vacation days or after closing at the end of the day (let’s say that’s 5:00pm)
  • don’t really want to approve your loan.

That’s right.  The underwriter’s job is to find a way to turn your loan down so the bank or other financial institution they work for is not at risk of you defaulting on your loan at some future date.  You have to be solid titanium (gold and platinum: get to the rear of the line) in order to get past the first hurdle.

The FHA Borrower / Home Buyer

As much as you hear about FHA backed loans being more flexible and forgiving to buyers who may not have a lot of money for a down payment or may not have the absolute best credit in the world, the underwriters are still looking for a way to tell you to take a walk.

Most recently, I encountered the problem of a home buyer who had evidently been shopping for homes with several lenders working the transaction.  As a result, this borrower had multiple FHA case numbers.  Normally, you would think: what difference does it make?  But, then, you know the Government.  Ain’t nothin’ easy.

Angry ManIt seems that because of these multiple FHA case numbers, this particular buyer could not get a mortgage until all but one was eliminated.  Why?  Because it looked like he was buying multiple properties which, of course, he couldn’t possibly do.  Now this may seem to make sense…and, in a way, it does.  What steams my shorts is the fact that this wasn’t uncovered until one day before settlement was supposed to occur.

So, picture this:  Seller has all but moved out of his house.  Buyer has all but moved out of his house and loaded up the truck or lined up the friends or moving service to spring into action. Then, all of a sudden…..STOP!  A mortgage underwriter has found a problem with the loan.

Could This Have Been Uncovered Sooner?

The short answer is: probably not. This isn’t the only loan the mortgage underwriters are working on.  Yet, you would think that some of the obvious stuff are things they would catch early in the process so that there would be plenty of time to work through the problems.

Remember, though, the underwriters don’t care.  They get to go home to their nice, warm beds and martinis and come back to work another case tomorrow.  It’s like a factory.

The only problem is that unlike a real factory, the system is hugely flawed and staffed by mostly incompetent drudges.  At least with a factory, there is a system and each widget that is manufactured at the factory goes through the same process so if a machine breaks down at the beginning of the line, it gets caught and fixed.  In the mortgage industry, it’s lucky if you can get a loan at all.

And people wonder why the economy isn’t recovering faster.

Is There A Solution?

Unfortunately, there is no solution to this particular problem.  It’s an integral part of a system that is so flawed as to be almost broken.

So the moral to the story is that you need to:

  • have all your ducks in a row
  • continue to ask for updates
  • be prepared to lose the home of your dreams because some anonymous mortgage underwriter had a bad hair day
About Ken Montville

Ken Montville is a Realtor® and Associate Broker with RE/MAX United Real Estate in the beautiful Maryland Suburbs of Washington, DC. He has been selling nice homes since 1999. Way back in the 20th Century.

When Ken Is not doing the real estate thing he can be found all over social media in places too numerous to mention and he listens to jazz, reads a little (mostly non-fiction), hangs out with the Rotary Club of College Park, MD and can be found blogging at

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  • Good post, Ken. I actually did NOT know about the working conditions of underwriters. Makes sense though, based on what I’ve experienced.

  • Candi

    As an 18 year mortgage veteran and mortgage loan underwriter, I feel like I have to comment. Your post is very hostile toward underwriters. Ironically, because we don’t talk to realtors, your likely source of information is the loan officer. Underwriters have a job to do and the job we do is in no way emotional, unlike your job apparently is. Let me address your most outrageous and erroneous comments and then I’ll give you a little snapshot of what a typical day for an underwriter is like:
    “Underwriters, on the other hand, get paid an hourly wage. For the most part, these folks who have total and complete control over whether or not you get a mortgage” This is TRUE and for very good reason. Think about what this statement insinuates…that underwriters should be paid commission based on whether or not we approve a loan or that if we deny a loan we shouldn’t be paid. This is downright ASSININE to even talk about, but because you brought it up, let’s! Underwriters are paid hourly or salary. There is a very good (and financially sound) reason for this. We are NOT paid a commission based on the number of files we approve ~ is it not completely OBVIOUS why that is?? This eliminates ANY potential for unethical conduct in relation to approving or denying loans solely for the financial benefit of the underwriter and pressure from interest third parties such as realtors and loan officers to approve loans that should not be approved.
    “Underwriters don’t care about you or your mortgage or your dreams for the future” This is 100% TRUE!!! My job as an underwriter is to ensure that your loan application demonstrates your ability to repay the debt, is sufficient to ensure purchase by the end investor and meets the guidelines established by FHA, VA, FHLMC, FNMA, USDA as well as existing “overlays” (overlay means that the investor adds their own conditions on top of the already existing agency requirements) leveled by each investor. My job is not to look at your application in terms of your lifelong dreams and aspirations are. Please note that there isn’t a place anywhere on a loan application asking for your future dreams and aspirations! My job is to make sure your loan falls within the parameters of existing requirements, period. Essentially, I make sure that the round peg fits in the round hole. If it’s square, I can’t issue an approval. An underwriter’s job is to ensure that the loans their company closes fit the guidelines established, PERIOD! If you want somebody to care about your client’s dreams and aspirations, refer them to a life coach, this is financial, not emotional, and the fact that you drag emotional issues into a business decision simply demonstrates that you really have no idea how things work once your loan officer takes over!
    “Underwriters don’t work on weekends, holidays, sick days, vacation days or after closing at the end of the day (let’s say that’s 5:00pm)” To this, sir, I say “Kiss my ass!”. I work an average of 14 hours per day. I work nights, weekends, I work LONG after 5pm. Please, ask my husband and 2 kids and they will tell you, I spend more time working than I do with them.
    “Underwriters don’t really want to approve your loan.” This is not true. In fact, as an underwriter for a wholesale lender, if we don’t close loans, we don’t make money and we don’t stay in business. It is in our best interest to solicit and close as many loans as possible. That being said, EACH AND EVERY ONE of the loans we close absolutely MUST be salable. If one is not salable, we have to buy it back at face value. At an average loan size of say $250,000, you can see how basing an approval on the borrowers “dreams and aspirations” could very quickly cause a company to go out of business. I have no preconceived notions when I begin to underwrite a loan. What I DO have is 18 years experience that tells me when something is not right. And 9 times out of 10, I’m right. What underwriters WANT is to review a file that meets guidelines, sign it off and move on to the next loan. That’s all.
    “That’s right. The underwriter’s job is to find a way to turn your loan down so the bank or other financial institution they work for is not at risk of you defaulting on your loan at some future date. You have to be solid titanium (gold and platinum: get to the rear of the line) in order to get past the first hurdle” You, sir, are a jackass. Your comment makes zero sense in any manner in which it could be taken. So if an underwriter’s job was to find a way to turn your loan down, we would never close loans and the industry would evaporate. You don’t have to be solid gold or any other ridiculous notion, you simply have to be a creditworthy borrower who meets the guidelines set (again, NOT by the underwriter) and who is financing a property that meets minimum property standards. That’s all.
    Let me tell YOU a story. This is a story about an incompetent drudge of a loan officer who, because he was too busy out golfing, showing off his new BMW and schmoozing new agents, never made any attempt to actually LEARN the intricacies of his business. Due to his lack of industry knowledge and lack of ethic, he has to consistently recruit new realtor business because he never handles an agent’s business satisfactorily. As you can imagine, this loan officer isn’t well versed in mortgage guidelines. He’s a great salesman, but details? Nah! He’s too busy for that. Instead, he hires a Loan Processor. Because he’s a cheap ass and doesn’t think anybody should get paid until he does, he pays his processor a paltry sum “plus a $100 bonus” per file closed, netting him the bottom of the barrel processors applying for the job. Are you feeling me so far?
    So you, Mr. Realtor, refers a client to this Loan Officer. He meets with your clients and blows them off their feet. Like I said, he’s one hell of a salesman. You provide the purchase contract that expires in 30 days (why you all keep using 30 days when it’s not realistic I’ll never understand) and he takes their application. He then turns it over to his processor and expects to next deal with this loan again only when it closes and he can sit at the closing table and act like the hero. Because this loan officer is not around to help his unskilled processor, it takes 2 weeks to process the loan and get it submitted to the lender. Of course, the lenders are slammed and are taking at least a week to underwrite the loan. At the end of the 3rd week, the processor receives the approval with conditions. It is at this time that she orders the appraisal. Of course, due to HVCC, appraisals are taking about a week and our cheap ass loan officer knows this, but he’s certainly not going to pay for it without a lender approval! Even though he has access to the same systems we use to approve loans and did run his loan through and received an automated approval that should suffice and even though he knows timeframes, this loan officer and processor are wasting MY time to put the thing in writing so they feel ok to spend their money. Wonder why we’re a week out??
    So now we have a week left. 2/3 of the way through that week, the appraisal comes back. I review the report only to find that there are issues with the property. I condition properly and provide the updated approval to the processor. The processor calls to go over the issues and we discuss them so that she understands what needs to happen…another waste of my time by these so called professionals who are supposed to know what they’re doing.
    And this, sir, is the time that our loan officer FLIPS OUT! Did I mention that as an underwriter, you take the wrath, on a regular basis, from loan officers who aren’t getting what they want and feel like it’s ok to personally attack an underwriter? But I digress. Now the loan officer has realized that closing is not going to take place on time and goes into panic mode. He calls and screams and yells and demands to talk to my boss. He yells and screams at my boss and demands to talk to their boss. Of couse, nothing is going to change, we don’t work on emotion remember? Once the loan officer realizes it’s not going to happen, he immediately switches gears. He contacts the realtor and gives him this long drawn out bullshit story about how the underwriter is just so mean and just doesn’t want to approve the loan even though they should and it’s not his fault, it’s the underwriter’s fault…and so on and so on.
    Next thing you get…….YOUR UNINFORMED, UNEDUCATED BLOG POST SLAMMING UNDERWRITERS! You have been played sir, played by one of your own kind, neither of you smart enough to spend the time really learning about our business, both of you content to sit back and whine like little children when you don’t get your way.
    Given the current state of our industry, I thought it was obvious that when we allow people to base financial transactions on emotion, it NEVER works! Don’t believe me?? Ask the millions of borrowers defaulting on home loans they never could have afforded and were not in their best interest and ask yourself, did the loan officer or realtor advise them against the deal, or did they visualize dollar signs and take their big ass check to the bank to finance that BMW and golf membership?? Underwriters back then did the same job they are doing now, fitting the round peg into the round hole, based on guidelines provided to us by agencies and investors. It is YOU, the realtor and loan officer, who carried the burden of ensuring you were acting in the best interest of your client and you DID NOT and still ARE NOT!!
    It is when you stop acting in the best interest of yourself and instead focus on the best interest of your client that our industry will finally turn around and begin to regain some of the respect we once had. I’m afraid when that time comes, you and your loan officer friends will be long gone, back at the used car lot and the rest of us can get back to working with professionals.

    • Bonnie

      Been underwriting 25 years myself and teach the stuff on a national level and quite frankly I agree with almost everything she said. She just neglected that we really never get a lunch break, most loan officers make more than the underwriters do management is forever pushing us to approve deals that are eminent defaults which of course result in management asking us at a later date why we approved such a case. That dude needs to spend a month in the hot seat with everyone screaming at him and at the end of the month when the processors finally submit every file they have, all on the same, with less than half of the informaiton necessary to even determine income and he finds himself stuck in the office until 8pm everynight waiting for the loan officers and processors to collect the information they should have collected 30 days prior maybe he will have a solid handle on the life of an underwriter. By the way, when it’s all said and done and he has gotten everything approved, closed and sold, they still get to tell him how much he sucks, you know the same stuff that is said about underwriters.

      • It never ceases to amaze me how many underwriters work 10 hours (or more) a day, 6 days a week and loans still don’t close on time. Or, some little document needs to be signed that has little or nothing to do with anything.

        People (real people) are getting ready to move. They’ve packed all their stuff, they’ve hired a moving van or begged friends and family to help, they’ve taken time off from work and then, all of a sudden, they’re told “WAIT!”, it ain’t happening or, best case scenario, the settlement is delayed a couple of days (or weeks).

        In 15 years of being a full time Realtor I have experienced a settlement delay due to title three times. I can’t count how many times lending has caused delays or killed the deal outright.

        Sure. Blame it on processors who don’t get you the file until the day before settlement. Hey, do you have a bridge you want to sell me, too? More likely underwriters have files sitting on their desk or floor or wherever and then get a reminder that, oh yeah, this is supposed to settle in two days, I better get working on it.

        If underwriters looked at the file and made the requests for whatever documents they needed at the beginning of the process instead of the end, the world would be a much better and enormously less stressful place. If the loan needs to be denied, doing it earlier rather than later would also help. If underwriters see their job as protecting the investor against undue risk or the consumer against himself. Do it early and get it over with.

    • Joe Schmoe

      You have completely confirmed what we have said about you stupid underwriters all along. You are a rude C U N T. You’re not a professional and you are useless to society. You’re underwhelming, underpaid, under talented, under sexed, and an underwriter. Go F U C K yourself because no one worth their salt would have anything to do with you!

    • berk

      Well try this on for size. On May 19 of this year I applied for a VA loan. Interest rate locked in with a contract from the seller all expiring June 27. Now go back to 1983 remember the economy. Well I do I was foreclosed on. Now fast forward 5PM June 25 I get an email the underwriter wants the foreclosure documentation. Are you kidding me who in there right mine would keep documentation from a very low point in there life 31 years ago. Well I sent back the email sorry I have no such documentation. So I guess in a few hours I’ll get the news “your loan was disapproved due to you buying a house over 30 years ago and the economy got you”. This overrides the current facts that my credit score is 730, I have no debt, my income to this debt was going to be less than 29%. Explain this please!!

      • I recently had a client that was asked to provide divorce documentation from 20+ years ago to prove that there was no ongoing alimony. He had since remarried, moved away and started a new life.

        Obviously, he didn’t have the papers so he was being forced to go to the courthouse in the County that was in the State he was divorced in. There had been a fire and a lot of records were destroyed. Luckily, he was able to retrieve his old divorce papers.

        Oh. Did I mention he no longer lived in that State any longer. Major hassle for a loan of less than $300,000 with plenty of income and credit scores over 800.

        When underwriters tell me they are just trying to uncover bad credit or fraud or some other such bullshit, I have to laugh. Your story and my personal experience all tell me that mortgage underwriters are told to find ways to kill the loan. It’s not enough to have sterling credit scores and great jobs anymore. You have to prove stuff from decades ago.

  • Wow! is about all I can say to that. Quite an eyeful.

    If it helps, I drive a 2005 Nissan Altima and I don’t play golf.

    One other thing, no matter how much time I put into a contract: 30 days, 45 days, 60 days. All the “challenges” seem to surface in the last week before settlement. I often wonder about that.

  • Candi

    That’s an easy one, we can’t look at the documentation until it is provided to us by the loan officer/processor. If they don’t provide it until the last week, we can’t review it to determine if it’s acceptable until then. I apologize for the “eyeful”, but I felt the need to stand up for those of us in the trenches who don’t deserve it and for the public, who you are leading to believe that underwriters are these evil people out there trying to prevent them from homeownership when the truth is, we are the ONLY ones out there who are actually able to protect them from themselves.

  • So, Candi, let me get this straight. Everyone in the home buying process is a screw up *except* the mortgage underwriter.

    Even if that were close to true, it is the Realtor (yes, us sleazy “only-looking-for-the-big-check” folks) that is the “face” of the transaction to the home buyer. Lots of home buyers have a few e-mails and a few phone calls with the lender, never see the appraiser, and have no idea what a mortgage underwriter is or does.

    It isn’t until the week (or two days) before settlement – no matter how far out it’s scheduled – that “underwriting” comes back with conditions for all kinds of paperwork and documentation for this and that and the other.

    Meanwhile, we sleazy Realtors have to bear the brunt of all the screaming and “why didn’t I know this before” or “the truck is already loaded.”

    If there were one or two instances where this happened, I could believe it was a loan officer or processor that didn’t hand in the paperwork fast enough. However, it happens far to often to be an anomaly. Not *every* loan officer is a BMW driving slacker and not *every* processor is an 18 year old, gum popping, neophyte.

    • Glenn

      Quit picking on the underwriters and put the blame where it belongs….on the so called loan officers. 90% of the time the reason loan conditions happen at the last moment is because the loan officer and the loan processor have not done a good job of putting together the file and are late getting the conditions to the underwriting dept. The oriigination staff believe in the oatmeal theory: Throw it against the wall and see what sticks.
      If the commissioned loan officers were really educated in their job and a true professional there wouldn’t be a problem.
      I have been a underwriter for 25 years and prior to that I spent 5 years as a loan officer and loan processor. Prior to that I was a REALTOR for 5 years. I worked hard to learn all about my industry and how to be successful. Most loan officers couldn’t tell you half of the guidelines required to qualify for an FHA loan. LOs: Learn your business or get out of the industry !!
      By the way, the other 10% causes for failure. Borrowers who lie and at the last minute one of the QC specialists at closing finds out about the lie by running a last minute credit check or LoanSafe fraud report.

  • Candi

    Thank you, you’ve made my point!! Not every underwriter is a dream crushing, bankers hours working, martini drinking heathens either!! So many of us are out there every day doing everything we can (within the ever-changing limits that we are given) to make things as smooth as possible. We are both in professions that are under high scrutiny by the public. We owe it to them to provide honest information. I feel that your post is a disservice to the very people that we both serve. Were this posted to a personal blog, not affiliated with a professional institution, I would not mind it at all. Your opinion is valuable, just simply misplaced in my opinion.

    I wish you success and fast closings!


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  • Dreamcrusher #2

    Go Candi, I couldn’t have said it better myself. I am also an underwriter. I underwrite wholesale loans as well for banks and credit unions for over 25 years. RD, FHA, VA, USDA and Conventional loans. The current over-regulation and investor overlays have made my job ridiculously hard. I too work 14 hour days, weekends, etc. when I have a make sense loan come across my desk that has to be turned down for some ridiculous guideline that has no impact on how the borrower will be able to repay the debt, there is no other person who could possibly fight for this guideline restriction to be changed than an underwriter. Amazingly other than my boss I am the only one here after hours and on weekends. I don’t get paid for overtime but I suppose I do this because I don’t care about the customer and enjoy being a dreamcrusher the same as Candi. I spend alot of time trying to train loan officers about the guidelines which by the way, I don’t make these guidelines..I just am tasked with enforcing them. I often wonder why the loan officers wait until the last minute to submit the loans to me, why they don’t question the deductions on the paystubs, the unreimbursed expenses on the tax returns, the undisclosed debt but I suppose its easier to blame the underwriter for crushing the dreams instead of asking why an “experienced” loan officer doesn’t pick up on these items prior to three days before closing. Or while we are at, where exactly do the loan officers go when 3 years later, the underwriter has to answer for their judgment call on a loan by whatever agency wants to point blame for the foreclosure? Last I checked we are all on the same team trying for the same goal. I too find it offensive to write an article blaming the underwriter.

    • Joe Schmoe

      You have GOT to be kidding. You’re an underwriter and your nickname on your post is “Dreamcrusher #2”? How fitting!!! I think I’m working with your sister, “Dreamcrusher #1” right now and she’s really having fun screwing with me and my family. We are in a hotel paying out TONS of money because she has held things up way beyond our closing date. You truly are ALL Dream Crushers! Your day will come B I T C H when you aren’t in control and someone screws with your life. Next time that happens don’t even DARE complain C U N T!!!!

  • Dreamcrusher #2

    Well said Candi, I couldn’t have said it better. I am also an underwriter. I underwrite wholesale loans as well for banks and credit unions for over 25 years. RD, FHA, VA, USDA and Conventional loans. The current over-regulation and investor overlays have made my job ridiculously hard. I too work 14 hour days, weekends, etc. when I have a make sense loan come across my desk that has to be turned down for some ridiculous guideline that has no impact on how the borrower will be able to repay the debt, there is no other person who could possibly fight for this guideline restriction to be changed than an underwriter. Amazingly other than my boss I am the only one here after hours and on weekends. I don’t get paid for overtime but I suppose I do this because I don’t care about the customer and enjoy being a dreamcrusher the same as Candi. I spend alot of time trying to train loan officers about the guidelines which by the way, I don’t make these guidelines..I just am tasked with enforcing them. I often wonder why the loan officers wait until the last minute to submit the loans to me, why they don’t question the deductions on the paystubs, the unreimbursed expenses on the tax returns, the undisclosed debt but I suppose its easier to blame the underwriter for crushing the dreams instead of asking why an “experienced” loan officer doesn’t pick up on these items prior to three days before closing. Or while we are at, where exactly do the loan officers go when 3 years later, the underwriter has to answer for their judgment call on a loan by whatever agency wants to point blame for the foreclosure? Last I checked we are all on the same team trying for the same goal. I too find it offensive to write an article blaming the underwriter.

  • Craig

    Ken’s obviously an idiot.

    • That’s what I love about Internet trolls who may or may not be mortgage underwriters — they have no clue as to what it is like to get almost to the finish line to purchase the home of their dreams only to hear those fateful words “underwriting will not approve your loan”.

      Previous commenters mentioned that underwriters were only trying to save people from themselves. Oh, goodie.

      Let’s see: The loan officer (originator) wants to make the loan because they get a commission (so they can play golf and keep their BMW). The processor is an hourly wage slave who doesn’t care one way or the other. They simply put the paperwork together to pass along to underwriting. The closing department doesn’t kill the loan. They put the final paperwork together for the title company.

      Who does that leave???

      SUPER UNDERWRITER. Demander of tons and tons of redundant documentation to prove beyond a shadow of a doubt that, barring death or dismemberment, the borrower will be able to repay their loan. The person who waits until the week before settlement (that’s the date you have in the contract which you got at the BEGINNING of the process) before asking for even more documentation that you have this or that or the other. The person, who, “saving us from ourselves” was demanding second appraisals because the first one actually showed a value that the mortgage could be approved for (luckily no longer an “approved” practice). “Oh no, that appraisal can’t be right. I live 3000 miles away, have never done any sort of home valuation and I can tell I need a second opinion.”

      Underwriters have discretion and, more often than not, use that discretion to kill the loan.

  • Scott

    I have to say this is all very interesting. I’m the bad contractor that lost everything in this “tough economic situation”……but that’s another story. I would like someone to clarify something for me……have the guidelines for mortgage approval after a Chapter 7 filing changed? I was told that if you let a home go back when filing (which I had to let a few go) that you would not qualify for a mortgage until four years from the date the home was sold by the bank. Nothing to do with discharge date or anything like that……that doesn’t make sense to me. Can one of the underwriters clarify if this is correct? According to the FHA guidelines it isn’t, but maybe it’s an investor thing?

  • Cliff

    Well said Candi and same to you Dreamcrusher #2. Ken will obviously never learn anything new but hopefully others will learn to set the proper expectations and put together a clean package.

  • I agree with Ken. My closing is being pushed back simply because my company was acquired by another company which is confusing the underwriter. This has been the most stressful experience of my life and everyone I meet agrees. I know the underwriter is just doing their job, but it doesn’t make it any less frustrating. It’s not my fault my company’s name changed.

    • Stressed,

      What really gets to me is that usually puh-lenty of time for underwriters to do their job if they would just flat out do it. Instead, files get pushed to the bottom of the pile or lost or the underwriter takes sick leave or vacation leave and no one does anything – the file just sits there.

      Your case isn’t that unusual, either. When companies are acquired or merged it like starting all over from square one.

  • Sidney Levesque

    I just had the worst day of my life waiting for someone to kick the underwriter of our buyer’s loan into gear before we lost the house we were buying and all the money tied up in this deal! We have waited 6 weeks for the buyer’s lender to get this loan done. Two weeks ago we made garage repairs they asked for. They did not ask for pictures until Monday. Today is Wednesday and they know we close on our other house tomorrow and they asked for another week! Can’t they take a few minutes to look at pictures?? We stand to lose the new house, the earnest money, we have a mover coming Saturday, my mother flying in Thursday to help move this weekend only, appliances coming Friday! What a nightmare! Never have I been so frustrated and felt so helpless. I cried all day.

    • Sidney,

      I feel for you.

      Isn’t it just crazy that not only must the borrower/home buyer pass through underwriter hell but the house needs to pass as well?

      There used to be a time when the home inspection issues were worked out between the seller and the buyer. Now, the underwriter needs to have a say. Everything needs to be just so.

      The worst part is that nobody is looking at these “issues” until just a few days before closing.

      Unfortunately the lender is not part of the sales contract so they don’t feel they have any obligation to get things done on time. They don’t care about what’s going on in your life or if there are other financial obligations like your new house.

      They just don’t care.

  • Sidney Levesque

    Ken, thanks for letting me vent.

  • michele

    Hi all!!! I am also a veteran underwriter of 18 yrs. FHA/VA/USDA conv…I am also a DE. Anyway I just walked off of my excellent paying job with benefits etc due to the fact that the other Underwriters are s-l-o-w…there, I said it! I can underwrite 6-7 new files per day along with 8-9 PTD’s. In Februaury I signed off and CTC’d 47 loans that btw…closed! I came in as a “temp” and within 3 days was hired as a full-time employee with benefits that were “retro” thats how hard I work. And I only worked 7 hours a day. The other Underwriters hated me with a passion!!! I pulled files for LO’s from the other Underwriters drawers, signed off cond and slammed the file to docs in 15 min. Underwriting is easy and fun. I became tired of the comments and “bullying” from the other Underwriters who, btw, should have been stoked that I signed off their cond and lightened thier work-load. Instead I received a “sticky” note on my chair that said “stop clearing cond on MY files” unsigned. Well HELLO? Biotch…if you were signing off your cond yourself I wouldnt have been asked to do it. gee wiz, it takes seconds to look at 4506 results, flood cert and WVOE…re-run the Du final the 1008/1003 and move the F*** on already! With that said, 14 hours, really? How do you chew on a file that long that you have to work 14 hours???? Should take 45 min to review even the most complex file. Okay 1 hour and 30 min max. These Underwriters I worked with took over 4 hours PER FILE!!!! C’mon now whos milkin the OT here? Anyway, I had to put my two cents in on your post. Bottom line, in 7 hours I could work on 15 files and then I was done and went home! I cant imagine working 14 hours that should be like 30 files right? Sorry girls 30 in one day too many for me 🙂 LOL

    • Considering this post was written awhile back, I’m often surprised at how often people stumble across it.

      Thanks, Michele, for shedding some light on how an effective underwriter can get the job done and allow a loan to get closed so people can move on with their lives. It never ceases to amaze me that the loan can’t be at the title company a day ahead of the contractual settlement date so the title company can prepare a final HUD-1 for lender approval. But everything is always very last minute…with people’s lives affected.

      • michele

        I could not agree more Ken. Exactly why I left Impac (whom I thought imploded) but apparently came back as Excel…They are Underwriting strictly to DU at this point as they are selling direclty to fannie and the Underwriters there STILL ran title 365 on each applicant (mind you appraisal waivers etc) low LTV and Hign FICO’s and the Underwrirter’s whom I thought had somewhat of an education STILL asked the borr/buyer to prove they had no affiliation with properties found on title 365. This baffeled me, its not on thier credit, they obviously HAVE no debt from these properties, they simply are on title. WOW now they want proof that the borr/buyer has no financial obligation to “these other properties” I ask…Where is the RISK? its a DU Refi Plus for Heaven’s sake with an Appraisal waiver to boot…how and why are these people being hired???? Am I crazy? Well I went in and “deleted” conditions and managed to get 47 loans to docs in Feb 2012. All of which were HIGH FICOS and LOW LTV’s lets use some commen sense people. I am angry of course, I have no idea why monkies are still being hired to make commen sense decisions and ruin other people’s lives. That company, IMPAC, had their biggest month ever while I was there and never even said “thanks” maybe that’s why we still have idiots pulling the trigger.
        I rec’d a 40 dollar starbucks card from an AE and I was very grateful. I seriously would rather find myself in Mexico on life support than have ANY of these people Underwrite my loan.

    • Joe Schmoe

      It’s sad that you quit Michele. It’s nice to know that even you, as an actual underwriter, agree that this system is broken. It’s broken mostly because of inadaquate people that have no talent and zero sense of urgency. These are the very people that are causing employers to hire illegal aliens because, at least, they work hard. What happened to American pride? These underwriters are lacking in pride and ethics.

  • Mike

    Refused for modification ! Due to the “original” investors direction. It took ASC/Wells Fargo 15 months to let me know of their decision. I was told that any payment I made during the modification period would not be applied so “don’t bother”. Now that want 30K or they are going to foreclose. Help

    • It never ceases to amaze me at what banks are willing to put home owners through. They have no clue about the stress, anguish and ruined lives (through ruined credit histories and lost homes). It seems like there are a bunch of robots (sort of like the people who were “robo-signing”) looking at these loans.

  • Mike

    Please publish my e-mail address.

  • cheated

    I was approved for a mortgage and met all my conditions. I also cleared the automated approval. I got my closing date again which the lo didn’t meet the first. The. Lo asked to pull another report to see if my score improved but he said he wouldn’t use the new report. A car loan appeared on my report so he denied me. He was aware of the car prior to this whole process. Is there anything I can do?

    • The Loan Officer probably didn’t deny you, it was probably underwriting. It is very common nowadays for lenders to pull another credit report close to settlement. You see, they want to make sure you haven’t gone out and done anything like get into more debt which would throw off the ratio they use to determine if you can pay back the loan. It doesn’t matter if it’s a car or bedroom furniture. You shouldn’t put a dime on credit between the time you are approved for a loan and the time you go to closing.

      If the car loan was known at the time you made your loan application there is something seriously wrong but, again, it’s probably some underwriter who thinks your loan is too risky and wants to turn it down.

      You could try another lender with another loan officer but that means starting over from square one and getting a new appraisal, etc. It’s a laborious process but it is the most likely way you’ll obtain a mortgage. Try giving Alan Gross (click on the link) a call or an e-mail and see if he can help.

  • Joe Schmoe

    I have been trying to buy house for 8 months. I’m working with the second one now because the first fell through due to underwriting. I totally agree that underwriters are completely disgusting people that have nothing in it for them to approve your loan. They take pride in messing with people’s lives and have no concern for anyone other than themselves and their families. Our housing market is the worst it has ever been and underwriting is a big part of this problem. If we don’t start letting people with good credit start buying homes again we will never recover. My credit score is in the mid 700’s and my credit to debt ratio is near perfect. I’m trying to purchase a forclosure that needs a little bit of cosmetic work because I’m a handyman and I want to save some money. The underwriters have all but completely done away with handyman specials because they won’t approve anything unless it’s perfect! What’s wrong with these losers? These are people that were bullied as a child and then couldn’t even muster becomeing a Cop to make up for all those bad childhood years. So now they flex their nerd muscles and totally enjoy screwing someone’s life up. I hope they get what they dish out in their future. If I ever meet one I’ll be sure to remind them of their childhood days!!

    • Joe Schmoe

      I hope all underwriters die young, however, if they are already older, I hope their children and grandchildren die horrible deaths so the underwriters can writhe in emotional pain until the end of thier days!

  • Charlie Cousins

    There’s enough blame to go around. I agree that, unless many mortgage lenders change the way they do business, there will be a continuing decline in housing as an investment–and as a personal hedge. I also agree that the process is a big part of the problem–but a bigger part is worker attitude. Many underwriters simply don’t care because there’s nothing in it for them. They get paid to shuffle papers, not close deals. Some lenders have targets underwriters are supposed to meet, but under present rules, that’s mostly under the table and unenforceable.

    The loan officer, processors, underwriters, and lender management all combine to create a megalithic hurdle to home ownership. I know this because I’m both selling a home (now post-appraisal) and buying a home (4 days past the closing date now). What Ken says about timeline efficiency is right on: getting a demand for docs on the close date specified by the lender (yes, that’s right)– and based on questions from a credit report pulled four weeks earlier–is absolutely inefficient, unethical, not a good business practice, and, according to our attorney, almost impossible to fight. If it’s not just the underwriter, and it’s hard to tell because no one in the process actually speaks to them, then it’s a combo of crappy management, an uncaring or incompetent loan officer, and processors without a clue.

    Don’t just beat on underwriters…beat on the whole system. But it IS the underwriters who have the heaviest hand in this national problem that has such a large effect on the economy in general.

    By the way, not all lenders are equally unable to organize a simple process. I’m currently with Veterans United and hating it. But QuickenLoans is, by personal experience, cheaper, quicker, and far more responsive to the customer. A buddy of mine put in an offer on a house a week after I did on a VA through QuickenLoans–and he closed last week. Our incomes and debt loads are similar. But I saw how he could access his account info by going online any time he wanted. And when he had an issue, the loan officer was back to him very quickly and the issue was taken care of.

    I’m not here to sell anyone on anything. Just sayin’.

    Now the question is: how much holdups and denials have to do with the fact most “lenders” aren’t lenders at all, but brokers with specific mortgage buyers with specific requirements?

  • Melissa

    Ken, I am currently in the process of “closing” on a home. I say “closing” because it was scheduled for today and two days ago a problem surfaced. I have excellent credit and enough money to put down on this home. Sounds like a no brainer right? WRONG! According to the mystery underwriter who could give two sh*ts about me, my DTI is off. The only reason for this is because she does not want to count my rental agreement as income. I have a renter moving into my current home in less than two weeks. We have a signed lease agreement and the renter has already paid her deposit (included a copy of lease and check to the underwriter). The loan officer knew all of this when we were preapproved, even told me that I could borrow more if I needed to. This was not sufficient, we were approved 8 months ago via our loan officer (who is also a shady character, might I add). Our home was built from the ground up and now not only is that home at risk but our current home is as well. I could be living on the street with all of this furniture and that underwriter could care less. I’m tired of being told I am a perfect candidate for a mortgage and being reassured by the realtor and loan officer. Its absolutely sickening to know that a random person is holding my lively hood in her hands. I’m seriously surprised there is no one that I can contact about this.

    • I totally sympathize with your situation. It’s horrible being led down a path with everyone saying that all will be well only to have a nameless, faceless underwriter screw up your life.

      Of course, from the underwriter’s point of view, you are just trying to commit fraud. They think you probably are submitting a dummy lease and fake check. They don’t understand that renting your home out is probably the best alternative to selling it or letting it go to foreclosure.

      Underwriting is all about reducing the risk of the loan going bad to zero. If they even think that something might not be perfectly kosher, it’s reason enough to kill the deal. I only wish that if they were going to be concerned about issues like this they would let people know early enough in the process. But, nooooooo. They have to wait until the last minute.

      My heart goes out to you.

      • Carrie Fisher

        We don’t wait for the last minute we know right away its hip to the loan officer to let you know and to get the issues corrected. We have 30 days to get a file approved because of government las if buyers drag their feet we have to cancel it.

      • FHA Underwriter

        Your, sir, are an ignorant fool. First of all, the federal government sets the guidelines on FHA lending. So, instead of bitching at the bank or the underwriter, call your fucking Congressman. Second, you mentioned previously how you are astonished at how we work 10 hours a day, 6 days a week, and yet still miss closing. It’s our fault right? It has to be! You’re not capable of critical thought therefore the fault is with the only individual you can identify. Perhaps we’re understaffed? Perhaps your client did not fully disclose their financial information. Our fault right? You may ask why it’s our business for your clients information, well, may be its because we are shelling out 96.5% of the actual price of the property. Would you borrow a complete stranger 5 times the average income for an American household without knowing how much they make or if they’ve paid others they’ve borrowed from back in the past? Of course! Because you fulfill dreams. Wrong. You oversell people on what they can reasonably afford because you make more money on it. Real estate commissions are one of the most flabbergasting financial arrangements of our time.

        • Moos3

          No, but I would use the terms loan and borrow correctly.

          Our home loan is currently being held hostage by the underwriter. Our income is sufficient to purchase the house, we have been diligent in providing all of the information that they have asked for in a timely manner, and yet, we find out that the UW hasn’t touched the file in a week because they were waiting on the appraisal. Then, they ask for paperwork we have already sent them, a form that currently doesn’t exist due to tax filing extensions, and oh, yeah, I’m going to need you to pay off and close these two credit cards that have ~$1000 or so on them total because your ITD is a percent too high.

          So you tell us this *now*? When you’ve had the file for almost a month now. You couldn’t have told us 3 weeks ago? Oh, that’s right, you didn’t touch the thing because you were waiting for the appraisal to come in.

          Underwriters deserve a special place against the wall when the revolution comes. But we’ll just keep them standing there because there are some conditions we need to fulfill before we do what needs be done….

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  • Carrie Fisher

    This post is so funny to me. I work at the bank I have worked for a few. I have been in loan processing and there before you speak about something you don’t know. We Do work holidays because its a call center. Bank branches do not. Yes everyone has sick days who dsnt get sick? When we are out our team works our loans. We have over time some times mandatory over time. The loan officer wants to get anyone qualified for the loan.. yes its our job to make sure the customer is qualified. That’s one reason the market crashed is because the banks were giving anyone a loan. Now there is all sorts of rules arty in place. I’f u don’t get approved for a loan. Get things strait in ur life don’t blame it on the bank because you have bad credit, or not enough money, or u want a house way above your budget

  • Mini Farm

    I really appreciate this article Mr. Ken Montville!! This is exactly what we are facing right now. I believe the underwriter woke up on the wrong side of the bed today (Monday) maybe from a bad weekend or ticked off because his football team didn’t win their game or as you said she had a bad hair day and has decided to decline our loan. We have been jumping through our backsides to give them anything and everything they wanted. We had a letter of guarantee from the VA, we had a pre-approval letter from the lender and we put up our Earnest money. WE have great credit! The sellers have already moved out and have purchased another place as well but can’t close on it until they close with us, which at this moment is not happening. The original closing date was tomorrow and they told us all they were waiting for is the appraisal. Since the 1st appraiser didn’t do the job, they had to get another one and can’t do it until tomorrow. We had to ask for a week extension due to someone else’s error and then we get the bad news from our LO! Well BULL!! Really feeling lost and frustrated!!

    • I feel your pain. I have to tell my buyer and seller clients all…the…time…that it ain’t over until the ink is dry on the settlement documents. Mortgage underwriters are not party to the contract and they don’t care if you get the loan or not. They don’t care about who’s moving where or when or who has already moved out.

      It’s amazing how crazy the system is.

      • Joe Bonadonna

        Very true

  • Sandra

    O dear Lawd, I never felt so low about myself and how I have lived my life in the last 7 years. I keep getting the same conditions asked over and over. So I own a home I rent to family and my mail goes there because my “sugar” daddy whom I live with opens and reads my mail. I don’t pay any rent or utilities and I thought this was a good deal for me since I managed to save 30K in one year! But, no…. They think I am lying and are still asking me to provide documentation that I have lived there the last two years. I told them I have been looking for a home to move into and they still don’t believe me. They then wanted proof that I was a fitness instructor and I sent my certificate, then they said does this allow you to teach in California? Duh, I live in California where else am I going to teach. And, ugh… I work in California and my company is in Omaha, NE. so the condition asks, “How can you work in California when your company is located in Omaha? OMG, the killer was tell us in your words why you want this home. Yup, bringing up a hurtful past, I was honest and said my man cheated on me and the girl had a baby and I tried to make things work but we decided to split up. Well they came back with the condition request: Well if you broke up, why are you still living there? OMG…..

    • Crazy stuff. I recently had a client that was required to dig up his court papers from a divorce 20 years ago to prove he didn’t have to pay alimony. He had to go to the courthouse in another State just to get the papers since there had been a fire and all the paper had been moved.

      Mortgage underwriters are requiring all kinds of crazy stuff. It doesn’t make any sense. If you can finanically afford the mortgage payment you should be able to buyer the house.

  • Jessica Tapp

    These people are the lowest. They are kept 3rd party and anonymous for a reason. They don’t do their jobs the way they are supposed to, tell you your loan is approved and just need to collect a corrected form from employer, then dig up something they should have seen on tax returns WEEKS ago. Tax returns are directly related to one’s income and should be reviewed FIRST. Not the day before you’re supposed to cleared to close. Silly little people given too much control and not enough compensation to give a rat’s ass. It’s ridiculous. Absolutely one of the most absurd things one will ever encounter.

    • Jessica Tapp

      But thank goodness for good and decent brokers that are professional problem solvers. They’re the ones that are working hard for their money and the one we are currently working with deserves a gold medal and a hug.

      • No question, Jessica. The originators, whether they’re brokers or loan officers that work for a direct lender, would like to see you get the loan. Underwriters, on the other hand, couldn’t care less.

  • Jill

    I have been so stressed, we are at our forty five day mark, we’ve been pushed back on closing four times. Friday we were supposed to close at 300 and at 230 they called us and said we couldn’t because the underwrite had found a discrepancy in our inspection documents that we had done TWO MONTHS AGO. It truly feels like for some reason suntrust just doesn’t want to give us this damn loan. It’s terrible. I just sat there and cried. Feels good to know we aren’t alone.

    • Jill,

      You are not alone by a long shot. Many people manage to end up in a similar situation all because mortgage underwriters are so far removed from the process. They have a ton of cases to process but you would think they could process them in a more orderly and timely manner so they can get past the problems and questions early in the process.

      No, they always wait until the last minutes when everyone thinks everything is moving along smoothly. It’s almost like they get a secret thrill from screwing up someone’s life.

  • John Gehrig

    Glad to see we aren’t the only ones with this problem. We have pushed back closing four times as well and the only answers I get are after 5 on the day of the deadlines with what they want or need signed or resigned. So here we are with a ton of money in a house already, 9 days to move out of our apartment and we have no real answer as to what we’re going to do.

    • John, there’s no question this process is a real pain and the worst part is that underwriters don’t care. The lender is not part of the contract so they have zero obligation to make the loan or meet a settlement date. It’s beyond words.

      No, you are not alone. This is an issue endemic in the lending industry and no one seems to be able to do anything about it,

  • Lamia Drakaina

    I’m trying to find information on why the underwriters need a document backdated. Both buyer and seller signed the document on 5/8/15, and the UW needs it dated 4/21/15 (contract date). The document just says that the buyers can back out if inspections don’t pass, etc. While this may not be a “big deal” to backdate the document, it’s lying because we didn’t receive it until the 8th. Why do they want us to lie? What difference does it make when it’s dated as long as they have it? And why would they wait nearly a month (5/30/15) to ask for the change?

    • A great question, Lamia.

      I’ve given up long ago wondering about or questioning mortgage underwriters. I had one instance where they needed to see the divorce decree from over 20 years ago. The man had long re-married and the ex-wife was not a party to the purchase. But they wanted to see it.

      Another instance where they waiting until the day before settlement to match up the tax returns they received from the buyer and the IRS. This is something they should have done very early in the process but didn’t. Needless to say, settlement hasn’t happened, yet.

      My philosophy is to give them what they want. It may be lying, as you point out, but if it means the difference between getting a mortgage to purchase the house or having the loan denied, just do it.

      • Lamia Drakaina

        I re-signed and backdated and sent it back. I just don’t understand. There is no logic with underwriters. Why couldn’t they have asked us to sign with the contract date the first time we received it? It’s just frustrating, and I’m sure this is only the beginning. When I bought the house, closing was pushed out 5 times and UW asked for docs already provided, etc., they had it marked as a re-fi instead of purchase, they had my ex husband’s name on a few of the documents (had to provide divorce decree). Just a lot of frustration and things that don’t make sense. And because the closing kept getting pushed out, I had to pay fees for utilities because seller had them turned off. I’m bracing myself with this sale that there’s more nonsense to come.

  • Jody Gomez

    This article is so inaccurate it’s laughable. I have been a loan originator and processor for over 20 years and I have yet to meet an underwriter who leaves at 5 pm. Most put in 10-14 hour days and all care very much about the borrowers. I have never met an underwriter who wanted to deny a loan unless the loan was substandard or downright fraudulent. The documentation that is requested is requested for a reason – to meet lender and government guidelines. Loans are reviewed after they are closed during a process called a post close audit, which is done not only by the investor, but also by VA or HUD if it’s a government backed loan. Underwriters are personally accountable for any deficiency that is found in a loan and they have to answer for every “I” that isn’t dotted or “T” that isn’t crossed. Lenders are bound to very strict investor and federal guidelines on every loan application – even the ones that are canceled or denied. The amount of continuing education we undertake is staggering, and we are far from detached about our borrowers and their loans.

    In my two decades in the mortgage industry, realtors have caused more problems than anyone during the loan process, because they know just enough about loans to mess everything up. Loan officers aren’t much better most of the time because they’re glorified sales people. Their job is to get the borrowers in the door; then they throw the (often incomplete) loan application on the processor’s desk to sort through and figure out how to make it work.

    To Lamia Drakaina, federal law requires certain disclosures to be presented to you at certain times. The reason the UW wanted you to dack date that disclosure to the contract date is because it should have been presented to you by your REALTOR the day the contract was executed. The fact that it wasn’t is your realtor’s mistake, not the UW. If the UW is asking for documents that you have already provided, then your loan officer obviously isn’t providing them to the processor to give to the UW (otherwise they wouldn’t be asked for again).

    Ken Montville, the reason the UW asked for a divorce decree some 20 years after the fact is due to the access to data that is available these days. I’m seeing it more and more where an ex spouse’s name will come up on a data verify report associated with our borrower. Just because the divorce was final 20 years ago doesn’t mean the borrower didn’t still owe the ex wife alimony, child support, or if the borrower was of retirement age, half of his retirement income which would affect the debt to income ratios. The UW asked for the divorce decree to make sure the borrower could afford the mortgage payments.

    Jessica Tapp, the issue with your tax returns most likely had to do with the verification transcripts the UW got back from the IRS. My guess is they didn’t match… it’s not the UW’s fault if you don’t provide copies of the exact taxes you filed with the government. Provided tax returns that are not the same as the ones you filed with the IRS is called fraud in all 50 states.

    Mini Farm, tell me please… how is it the UW’s fault that the appraiser didn’t do his job in a timely manner? The realtor sets the appraisal inspection appointment, not the underwriter. Wonder where the hold up really was in this issue?

    I have seen every issue presented in these comments during my career, and I can tell you that every single example of something gone wrong is due to either a loan officer or realtor who doesn’t know what they are doing. If they did, none of the issues mentioned in these comments would have taken place.

    • Monique Grinage

      hi Jody I need your opinion. My husband and relocated from NC to FL. We sold our home and bought a beautiful Lennar Home. We have completely moved in pictures, TV’s on the walls. Now the broker UAMC sends an email yesterday questioning income. They need additional info to sell the loan to another investor. Can they put us out of the home we moved into 8 weeks ago?

      • Jody Gomez

        Hi Monique,

        It sounds like the original investor didn’t like the documentation that was provided and they need to fill in the vlanks, so to speak. What additional documentation are they asking for?

        • Monique Grinage

          Thank you Jody. This information is very helpful.

    • I have never read a comment yet from an underwriter who doesn’t claim to work long hours into the night and weekends trying to help people get a piece of the American Dream by buying a house.


      Underwriters don’t get paid enough. If they do work OT it’s because they either need the money or they work for companies that intimidate their workers into doing things they shouldn’t (like work late into the night and on weekends).

      Sure. It’s a good thing to try and find fraud and to make sure tax returns match up with the IRS and people make as much money as they say they make. I’m all for it.

      However, high credit score, high income, high asset people still get put through the wringer, it seems, “just because”.

      Besides, how hard would it be to do a little of this legwork early in the process instead of two days before settlement when everyone is ready to move.

      It seems to me that underwriters get a file and see a settlement date about 30 to 45 days out and immediately put it into the “later” pile only to start working it a week before settlement. It’s then the underwriters start asking for this, that and the other document and proof all kinds of ridiculous stuff.

      If you’re gonna “find fraud” or other do-gooder deed, it can be done just as easily within two weeks of getting the file. But nobody does that. They would rather everybody have the moving truck loaded up and ready to go before they kill the deal.

      “Collateral Underwriting” also allows the underwriter to challenge the appraisal. It doesn’t matter if the underwriter is in California or North Carolina with a property in Maryland. They can say, “Nah. Don’t like the value. I’m changing it.”

      Speaking of glorified salespeople….I can guarantee you there is no glory in either originating loans (which keep underwriters employed) or being a Realtor. We’re the ones that get the calls, texts and e-mails every three hours when a loan doesn’t close on time. We get the screaming clients. We get the people crying because they have already moved out of their apartment or other house expecting to move into their new house. We’re the ones that people want to reimburse them for additional expenses caused by sloppy underwriting. I wish we were glorified.

      The fact is that there are some lenders out there that, for some magical reason, can get a loan done on time or even a couple of days early complete with an approved HUD-1 and instructions and funds to the title company. If some mortgage companies can do that, most should be able to.

      Thankfully, new rules are being put into place with steep penalties so lenders (and that means underwriters) will need to get their stuff done in a time frame that respects the buyer, the seller, the title company and the glorified sales people.

      • Jody Gomez

        Hi Ken,

        I’ve been an originator and processor for over 20 years, so I am intimately acquainted with both ends of the mortgage loan. It seems to me your anger towards the underwiter is misplaced. A good loan originator and good processor will avoid 90% of the issues you bring up. Too bad you’re not in California. Otherwise I’d do a couple loans for you so you could see what it’s like to work with a team who actually knows what they’re doing. I close almost all my escrow on time and have enough experience to know what documentation to get from the borrower in the beginning of the process instead of scrambling at the end.

        • Jean

          Hey Jodi,

          I am 3 week past my close date and I am getting very sick over this whole thing because we still do not have a close date and are being told that our file is on the underwriters desk. It is next to be looked at. That was a week ago! What can we do on our end? I have asked questions but maybe I am not asking the right one? Is there some sort of timeline the underwriters have to stick with and how can I get that proof to show she/ he is sticking to it?

        • Jeanine Elizalde

          I received my loan pre-approval in the mail.. A week later I was told they pulled the approval because last year I didn’t work while being treated for cancer.. This is a mobile home loan for $36,000. Can they do that? I’ve worked in the same industry for 22 years.

          • They certainly can, Jeanine. It’s their money and they probably think there is a risk of default if you have health issues that will affect your income and ability to repay the loan.

            Pre-approvals you get in the mail are really mostly scams to get you to commit to a certain lender. Nothing is really “approved” until a mortgage underwriter says it is and they’ll run you through hell to get one.

            You might try going through the management company that runs the mobile home park. They usually have a good source of mortgage money specifically for mobile homes.

            You might be out of luck, though, even for $36,000.

          • Jeanine Elizalde

            I went through the loan process with the mortgage company.. After providing tons of paperwork they approved me, I paid my earnest money, they said escrow will close on October 1.. Thursday the realtor called with the news that I’m not approved because of the year off. For cancer treatment, caught early, completely gone.

          • Jody Gomez

            I don’t know the details of your situation, but based on your comment alone, something doesn’t sound right. Taking time off from work with a documented medical condition and returning to the same line of work should not affect your qualification.

          • Jeanine Elizalde

            I agree.. In today’s mail I received information about the lenders appraisal regarding “your” loan.. Now I’m really confused.

    • Tressa Dutton

      How long after inspection, appraisal, is done will underwriting be done. Today is the 3 and we have a closing date of the 18th. We didn’t have any issues with our appraisal, and have fixed all inspection items. The title search paper has been signed, and now I am just wondering how much longer? I would like to hear from an UW.

      • Hopefully, an underwriter will answer your questions. Most of the time all I hear from a loan officer is “there’s plenty of time” yet they still keep asking for more and more documents.

        “This is the last condition, I swear.” Two days later they call and say something to the effect of “The underwriter noticed such and such and needs another document.”

        I’m kinda in the same position. I have a closing date on the 16th and they keep telling me everything will be fine. Then they ask for something else.

        • Tressa Dutton

          Well I am the seller, and it is crazy not knowing if I should let the place we are looking to rent an actual date to move in. We have no idea when this will be over and when we should move. I know we have to move before the closing date. It is just crazy the timing.

          • I’m with you. I’ve worked with many a seller who has everything packed up and moved out only to find out at the last minute there will be a delay. Sometimes it’s only a day or two. Other times, it’s a week or more.

            Unfortunately, there is nothing you can really do about it except hope for the best. There are lenders that can get things done and close on the scheduled day. Most of the time it’s a real crap shoot.

          • Tressa Dutton

            It is truly such a scary process. All our realtor can tell us if that the lender says its still good for the 18th to close.

          • I’ve walked through this so many times. I wish I could tell you something that would make things easier but, the truth is, you just have to have faith it’ll happen. Who knows? You may be one of the lucky ones where everything happens like it’s supposed to.

        • timej31

          They would but they’re busy at the moment. I was reading that average caseload for an underwriter a month was 166 in 2005 and now its 33. That’s a pretty big drop. And its not because people don’t want to buy its because Dodd-Frank requires so much more documentation and a lot more legwork done qualifying buyers.

          • That’s part of it, time. The other part is that 99.9% of the time the originating lender sells off the mortgage within minutes of the settlement and they don’t want to “buy it back” if the entity they sold it to (like Fannie Mae or Freddie Mac or HUD) find that they forgot to get some obscure document.

            The originating lender doesn’t want to get saddled with a $300,000 loan on their books.

      • timej31

        Forget about closing dates set anywhere. The underwriter has his own clock and it won’t be done any sooner than when they finish. We are 6 days past our closing date and its “in underwriting”.

        This is probably why home ownership is at very low levels People are hanging onto their homes because they know its a long process for people to get a loan so why bother.

        Then some of the existing home owners have had their credit dinged up a bit so they are staying put because the alternative is renting and who wants to do that right?

        Don’t get me wrong there are people selling and they sell fast but there just isn’t the volume there once was. If you look around you I bet you notice the property values in desirable areas just skyrocketing. I know I do.

        Add a major company or two moving into your city and divide by a very rainy spring and a huge backlog of new homes and you get a hyper hot existing home inventory market that sells homes in hours.

        But today thanks to Dodd-Frank the borrowers today are much more qualified. Gone are the days of subprime where everyone was getting rubber stamped for a loan.

      • Jody Gomez

        If you provided your loan processor with everything she asked for and your file is complete, it should go quickly. I usually have loan approval within 7-10 days from the moment I receive a brand new file.

        • Tressa Dutton

          Thank you for the response. We were told by the lender Friday that we should hearing something either today or tomorrow. They said we are still looking to close on Friday. So excited and anxious. I will see!

          • Jody Gomez

            Best of luck to you!

      • Carabella1

        Your point of contact will never be the underwriter. It’s the LOL or processor. Once the appraisal is recieved, normally we get the loan. A lot of times we’ll underwrite a file subject to the appraisal. Normal turnaround from there might be 72 hours. Once we’re done underwriting the file you may be asked for further documentation to complete the file. Your appraiser will go out and reinspect the repair items. Your time frame was normal. Hope your closing went smoothly.

        • Tressa Dutton

          We received our clear to close about an hour ago, and we are to close on Friday. So excited now to pack up the rest of our enormous amounts of stuff into a truck and move. Thank you for your words of wisdom.

    • Andy

      You seem knowledgeable. I have a situation I would like a comment on.
      I have a balloon payment coming due on my house. I started the process at the local bank to get a loan. After paperwork and a couple weeks they said we were approved for an fha loan. Then in the next couple weeks signed a bunch more paper work. They then sent out an appraiser. Signed more paper work. Then they said we would close in 3 weeks. That week came and they changed and said closing would be in 2 weeks from that point. Then that week came and they said they needed new pay stubs because it now had been too long to use the original ones I gave.
      Then 2 days before this closing date the bank said I was denied for the loan. Saying not good enough credit. My credit score is 658. I have no credit cards, only have a car loan and have not been late on it ever. Can a bank do this? Seems like total b.s. to me.

      • Your lender should have never strung you along for all this time. Ditto the underwriters should never have had you sign all the different documents without having an idea that you wouldn’t qualify for the loan.

        If you’re simply trying t refinance, it shouldn’t be all that hard. There are a number of factors that may come into play, though. How much is your home worth vs how much you owe on it (this is equity in your house). If you owe more than it’s worth that should have come out when the appraisal was completed.

        However, you point out that they mention your credit is not good enough. 658 is a low-ish score and you may need to do some work to bring it up. You can usually get a free copy of your credit report to see if there is anything on there that doesn’t belong to you or is erroneous or very old. Check out to get your credit report.

        Having said that, the lender should have told you that upfront and early in the process.

        I would suggest finding a good local lender – someone you can talk to in person – who can walk you through the process. Online lenders or big national mortgage companies don’t care about you. They just try to push you through the system and hope for the best.

        Good luck.

        • ROBERT S

          Ken: It is not called being strung along. It is called compliance. Lenders have to be meticulous in making sure a borrower has been given every opportunity to present their financial situation accurately for a fair evaluation. Lenders face high scrutiny in this day and age under many different state and government regulation. Hefty fines and sanctions (up to and including loss of state and federal licenses and criminal charges) can result from discrimination ,redlining, and many other offenses. Even you as a realtor has to comply with ECOA and other regulations to be in compliance with your real estate license and state regulations. Your reckless and uninformed article is disturbing and shameful

          • It’s not disturbing and shameful. It’s the truth. Long before TRID (when this blog post was written) and now, even with TRID, there is no excuse for the way underwriters just mosey along and get to files when the feel like it. Everything from ordering tax records to verification of employment always seem to happen the week before the contractual settlement date.

            Of course, the lender is not a party to the contract, so they don’t care whether the deadline is met or not.

            I recently (within the last 9 months) had a sales contract that I put 45 days into so the lender would have puh-lenty of time to get things done. The buyer had a 20% down payment, good income, high credit score. Nevertheless, it took almost 60 days and both the seller and buyer were left hanging on a day-by-day basis.

            That, Robert, is disturbing and shameful.

          • FieroGTKid

            Robert, Ken is correct. This process was created not only to make sure property is compliant, but to look for any reason not to loan the mortgage to the buyer. These underwriters are designed to turn down a FHA HUD loan. Period.

      • Jody Gomez

        Hi Andy,

        Did your income decline? What was the reason they gave you for the decline?

        What state are you in?

        • Andy

          Income actually increased because I got a raise of 400 a month.

    • Janet Ascione LaCroix

      Hello, Jody, and thank you for posting your comments; They are extremely helpful and appreciated. I was wondering if you could answer a couple of questions. We are about to get a closing date on a new home. We have an FHA loan. The appraisal was last week. I had contacted a couple of other lenders, one sent us papers to sign on another house we were going to purchase but did not. Will there be an FHA number assigned to us from past inquiries? Also, I mistakenly purchased a dining room set on line for $500. I was able to get a refund that will be going through this week. Will this affect my mortgage? They still haven’t provided a closing date. When do you see that happening, and will the underwriters have to verify employment again before closing, if so, we need to know because it took my husband’s employer, a high school, several days to respond, if we know, we can contact the school. Thank you very much for all your help. You are appreciated.

      • Jody Gomez

        Hi Janet, the FHA case number stays with the property. If you were in escrow in another home, be prepared to prove that you cancelled that transaction by providing your cancellation escrow instructions. Regarding the credit line you opened, of you’ve taken the merchandise back, a reciept showing you returned it and have a zero balance will be enough to prove you don’t owe the debt so it won’t be counter against your debt ratio. In regards to the employment, it’s always helpful to have HR ready to provide a rapid response, so it wouldn’t hurt to call them and give them a heads up.

        • Janet Ascione LaCroix

          Thank you. You are a valuable resource. God Bless You

        • NoobleBear

          Hi Jody, apologies for treating this like an “Ask an Underwriter” comment section but I was curious as to what the chances were of being approved for a building loan with a foreclosure only just past the 3 year mark. Assuming that was the only blemish of course… would the market crash in 2009/10 and being upside down but forced to move due to increased family size count as an extenuating circumstance in your professional opinion?

    • Sally Newman Buckner

      I am “banking” on your positive answer above! We are at the mercy right now of the underwriters not being happy because the job verification on my husband came back saying 40 hours “PLUS/MINUS” … .They need the “minus” removed or won’t give us the loan! We only have 3 more business days before our “ratified” contract goes down the tubes! The man who can change this hasn’t returned phone calls … so we are just waiting. My husband will actually be working 50 hours a week plus per diem … so I wish they would get a grip and get our loan approved!

    • Roger L. Philabaum

      Yeah. That’s why you can never get in touch with these so called hard workers. We are on underwriter #3 and have had to tell all 3 that they already had the information they were requesting and not only that but tell the incompetent morons what page and what line the information they were requesting was on! They do this for a living correct? Give me a break!

      • My guess is that mortgage companies burn through underwriters like most people change socks. I can understand that the hours are grueling and the case load may be huge. What I don’t understand is why mortgage companies don’t hire more to take up the slack.

        Wait. I do understand. They don’t want to pay for more people. They’d rather inconvenience the borrower who, once everything is over, will never work with the lender, again. Churn and burn.

        It’s really inexcusable but it’s the way of the industry.

        • Roger L. Philabaum

          You sir are 100% correct in your statement!

    • FieroGTKid

      Your are wrong, Jody. It is not humorous that our family, as well as many others, are going this exact same thing as Ken Montville spoke about in his article. Many people feel that some of you realtors and or lenders who respond in this inane fashion are mortgage plants or trolls that truly know the truth. Yes, the buyer is held up and totally at the mercy of these underwriters. This is a FACT. My brother help start one of the largest insurance companies on the planet and this is the case with these underwriters. Sorry, your incorrect with your reply to real people who go through this painful shameful process everyday. Please stop misguiding buyers as this just adds to the failing process of home buying.

  • Monique Grinage

    well what if you have already moved into your new home? and now 8 weeks later the broker is asking or questioning income again and needs additional information to sell the loan to another investor? can they put my family and I out of our new house?

    • As long as you pay your mortgage each month on time, I wouldn’t worry about having to move. If you’ve been to settlement and signed all your mortgage documents including the Deed of Trust and Note, you’re good unless you default.

      Despite all the other stuff Jody says, the underwriters real job is to make sure whoever you are getting your loan through can sell it off 10 seconds after you settle. If the underwriter misses something or if the guidelines aren’t followed to the lender the “investor” can reject the loan and whoever loaned you the money is now on the hook for it unless they can find an investor that will take it off their hands.

      Most small lenders that works with builders like Lennar don’t like holding onto loans. That doesn’t mean they can kick you out.

      • Monique Grinage

        Thank you Ken. Yes all documentation has been signed & we have the Deed of Trust.

    • Jody Gomez

      Hi Monique. The loan has already been underwritten, funded, and recorded so they can’t call you loan due and put you out of your home. They may threaten to do so, but it’s done, so they can’t. If you can’t provide it, the broker will have to buy it back and will probably try to refinance you into another loan. The best thing to do is provide the documentation they’re asking for.

  • Tonya

    That is scary about you mentioned regarding the underwriters. Maybe they are like the “underdog” and underpaid. I am in the middle of the process and the next step will be the underwriter. All I can do is hope and pray that the loan is approved. If not, then it wasn’t meant to be at this particular time. I live in a nice apartment and have been there for almost 5 years and ready to get a house but I am also very content and patient.

  • Conan Javier

    I’m going to have to agree about underwriters. Me and my wife were told we’d be closing 3 weeks ago and twice since. The day we were told we were good to pack our moving truck we did just that, packed our entire house only to find the underwriters pushed it back a week. So we had to pay for storage and are living out of our Damn Van. then another week passes. Again push it back a week because their system was down? What! so it’s down why does it take a week to come back up is your IT staff idiots?? No i don’t think so. Luckily my realtor is paying for the storage and me my wife and two kids are living with my in laws bless there hearts in the interim. Sleeping in a full size bed all 4 of us!. I was just informed today they are pushing it back another day. I have no one i can call the underwriters are invisible entities i’m sure they don’t give 2 Sh$%# about me or my family or else this would have been done 3 frigg’n weeks ago or 51 days ago when this damn loan started!

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  • Carabella1

    As a mortgage underwriter for over 15 years, let me set you straight.
    Yes, a lot of us are paid hourly. A substantial rate, I might add. And bonuses at some companies. I wouldn’t say upwards of $75k to $100 is inconsequential; we earn it, considering we must have substantial years of experience, are required to keep up with ever changing guidelines, and must have the ability to suggest ways to make a loan work. Contrary to your absurd notion that our job is to find ways to turn down a loan, our job is to take a borderline application and get it through to closing.
    We don’t pull conditions out of nowhere. When we ask for something you don’t feel is reasonable, it’s to support what a borrower has provided. Loan officers and processors present the “story”. We’re the ones who tie the story together with a nice, neat ending. We have investors to answer to. Most of us have designations (i.e., FHA and VA) that we worked hard to obtain. When one if our files is audited, WE are the ones who provide substantiation for our decision to approve your loan.
    When you go to closing and there’s an issue, guess what those issues normally are?
    Another credit report is pulled right before that day. You’ve bought a new car, or a house full of furniture, and guess what? You suddenly no longer qualify. WE are scrambling to get this done and YOU have thrown a monkey wrench into the mix.
    A verbal verification of employment is made. Your company informs us you were laid off, or the company has closed. YOU thought we’d never find out.
    The fact is, we DO care. We care very much. So before you make unsubstantiated claims that have no basis in fact, do your homework.

    • I hear this stuff all the time. The file is incomplete. The buyer went out and bought furniture. All kinds of stuff to shift what is really happening away from the underwriter.

      What about tax returns from the IRS? That shouldn’t need to wait until the week before closing. Unless you’re closing on April 15th the IRS should have returns that match the borrowers or not. Yet, time after time, it’s the week before settlement when they’re ordered and the deal falls apart if they don”t match.

      What about HOA or Condo questionnaires? The buyer really doesn’t have anything to do with those. They need to be reviewed. But when are they ordered? At the end when everyone knows that condo and HOA management companies take quite a long time to get a response back to the underwriter. God help us if there is even the smallest thing that doesn’t look right.

      You want to uncover fraud and make sure that the loan falls within the guidelines of the investor? Fine. Great. Wonderful. How about doing it so that if there is any bad news to share you can share it early enough in the process so that everyone isn’t packed up and ready to move.

      The fact is the mortgage industry and underwriters have gotten so used to waiting until the last minute that they can’t help but go past the contractual settlement date (contractual for the buyer and seller, certainly not the lender).

      The attitude seems to be, “No biggie. They’ll just have to wait another week or two.”

      I do know that there are companies out there that can get things done and do deliver bad news early if there is bad news to share. Most of them just leave the file on the “later” pile until it too late for anyone to do anything except scream and cry.

      As you pointed out, the underwriter is immune from all of that. They’ll never get the seller asking who’s going to pay the additional mortgage or utilities. They’ll never get the buyer crying that everything is in the truck and they’ve given notice that they’re moving out or they can’t keep telling their employer that settlement might be tomorrow or tomorrow or tomorrow.

      • Lacey Reddy Bathala

        This happened with my friend. Two days before closing the underwriter says they need IRS transcripts ASAP or else they can’t close. Has anyone every heard of the IRS giving something to you in 24 hours or less? Normally you can log into the IRS and get transcripts electronically…until Russia decided to hack the system and steal a bunch of info and the IRS was forced to shut down access to online transcripts. Closing was delayed 30 days or so, in the mean time the buyers of their house almost backed out due to the delay because they couldn’t/didn’t want to wait that long to move in which would have caused their loan to completely derail. They had to pay their buyers a holdover fee just to stay in the game. BS if ask me….the underwriters should request IRS transcripts on day one if they are needed.

        • Amen, Lacey. There is no reason to wait until the last minute to get IRS transcripts. They’re not going to change between Day 1 and the day before settlement. It completely baffles me why underwriters to do this first thing.

  • Victoria Bordner

    the underwriter for my buyer’s loan will not approve unless two items (already disclosed) are inspected and possibly remediated. I am selling as is, am unable to pay for any inspections/possible remediation and feel it is not a good idea to put myself in a position to possibly discover new issues that will certainly make the buyer walk anyway and leave me with new issues to fix and or disclose going forward. The deal with this buyer is NOT great, purchase price is $2000 UNDER appraised value, I am paying $2500 toward their closing costs AND i had to put in a new furnace ($1800) for them. Contract with my listing agent expired at the end of August and she has left me in the dust which is almost a relief to how grossly she misrepresented me during our 6 month contract. I offered to extend the closing date if the buyer wanted to seek other financing but I don’t think my agent communicated that to them. Buyer offered to pay to inspect one of the issues but not the other even though I have said I cannot/will not pay for either. The closing is scheduled for next week. I have found nothing in my contract that indicates I am legally obligated to secure this buyers financing. Don’t they need to formally request something from me in writing? Do I just let the contract lapse?

    • You aren’t required to obtain the buyer’s financing. It really sounds like the buyer won’t be able to secure the funding for the loan from what you’ve written in your comment.

      If the settlement date passes and the buyer can’t obtain financing you may just want to let this one go and get yourself a decent Realtor who will look after your interests.

      The good part is that you sound like you know the appraised value of the house so that’s a good baseline to establish an “as is” price that will help sell your home quickly.

  • hollynla

    I just recently sold a house, have had friends and family deal with buying/selling and am now currently a buyer myself. What I have seen and heard of underwriters doing is absolutely appalling. Many of the things they are questioning have nothing to do with someone’s ability to pay their mortgage. They even had my VA buyer get a letter from their commander. So they are asking high ranking military to take time out of their day to write a letter to an underwriter? They made us push closing back three times as well with conditions, mostly meaningless conditions. We were already moved out, sleeping on an air mattress at family’s house and as the buyer would satisfy conditions, underwriters would fine a couple more, making us extend yet again. Everyone was horribly frustrated and I’m sure the joy of buying a new home was lost in the process for the buyers. Now I”m a buyer and my loan was submitted to underwriting today. The game begins…..

    • On the upside, you’re more prepared than most. Most people have their loan officer telling them everything is peachy keen until the underwriters start getting around to process the file. That’s when the fun begins. Usually that’s not until the Eleventh Hour and both buyers and sellers are gearing up to move and pass possession of the real estate.

      It’s then that the mortgage underwriters start finding all kinds of things wrong. They say they’re just trying to adhere to lender guidelines and detect fraud. Why they wait until the week before settlement is beyond me but it is extremely common.

      • hollynla

        I started reading about today mortgage guidelines last fall so I feel more prepared than most. We have our ducks in a row as best we can but I’m sure they’ll find something to throw at us. We are downsizing and our mortgage payment will be half of what it was, we are putting down 45%, excellent credit, self employed in same industry for 20 years, income qualifies for much higher than we are borrowing, over a years reserve in bank account, only one credit card for debt. I’ll update here if anything is conditioned or asked. I would think we are the perfect buyer but we’ll probably be put through the ringer by underwriting.

        • Thanks….and good luck.

          • hollynla

            Update: I am very glad to say that my loan officer was correct when he said underwriter takes 48 hours, they took a little less and we got full approval with no conditions except waiting on appraisal (rural area and finding appraiser to accept it took longer than usual.). I’m so happy that this did not become a nightmare for me as I had prepared for all year. LO did tell me that they fund most of their own loans so they aren’t selling them immediately after closing, so maybe that makes a difference. The relief I feel is more than words can say.

  • Marie Boudreau

    My son gives me cash for rent money and I work full time and take care of my parents and just kept putting it in my safe so I wouldn’t spend it. Now my husband and I applied for a VA loan, got approved, I put the cash in for the good faith money and are ready to close and they are still asking about where the money came from even though I wrote a letter stating it. We have already paid for the inspects, had the house appraised by the VA and gave a ton of paperwork.
    Can you go to another underwriter if you get denied two days from closing?
    We already packed and gave 30 day notice at our place.

    • At this point all you can do it wait it out and keep giving them whatever they want. It’s crazy that mortgage underwriters wait until the last minute to decide there is something else they need but it’s very common.

  • Spring24

    Well, reading this was the worst mistake I’ve made all day. My first time homebuyer’s loan is STILL in the underwriting process (after my better conventional loan fell through for reasons that no one can explain. Literally, “You were fine this morning, nothing changed, your debt to income actually decreased and you were changed to ‘refer with caution’, not even our corporate office can explain it, sorry.”) and I’m supposed to close in 48 hours. I guess I didn’t really need to sleep tonight.

    • If your loan is still in underwriting, you might talk to your Realtor about extending the settlement date. It would take a miracle for it to get to the title company for closing that fast.

      It sounds like the underwriter is being extra super cautious (“refer with caution”) and they are looking into every nook and cranny. This will take time and it may not have a happy ending.

      • Spring24

        It was just cleared to close!!!!! WOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!!!!!!!!!!!!! 😀

        • Rock on! Enjoy your new home.

          • Spring24

            Thank you!


    Hi. I have been a Broker for 38 years in Real Estate, and I find this article to be true especially today. October 8th, 2015. Some find it laughable, but the same people who are underwriters with experience do not realize the nightmares caused by all the other twenty and thirty year old underwriters. Since 38 years ago, and referring clients to local banks, and including mortgage reps., I have never heard one complaint from a borrower. Today, the underwriters issue commitments with congratulations and two,three, four conditions . Then after the condition are met, they come up with 2 more. Then its 1 or 2 more and another month goes by. It is draining, sometimes unnecessary, and ridiculous for what they ask for. The only thing they do not ask for today is a urine sample and blood test to. Totally uncalled for in many situations.

    Imagine a buyer applying for a mortgage who is divorced, has been for 4 years, being requested to get a letter from the ex husband who is not an applicant, for his personal information. Believe it or not. Half the ex husbands care less about their former wives now, so imagine them cooperating giving their personal info today. Sounds stupid, ridiculous but this does happen.

    And believe me, Realtors are not the problem, No mortgage no deal. No closing no paycheck.

    Always good to hear both sides.

    Clients, borrowers have rights. Forms of harassment, badgering, discrimination,

    If You Suspect Discrimination

    Take action if you think you’ve been discriminated against.

    Complain to the lender. Sometimes you can persuade the lender to reconsider your application.

    Check with your state Attorney General’s office to see if the creditor violated state laws: Many states have their own equal credit opportunity laws.

    Consider suing the lender in federal district court. If you win, you can recover your actual damages and be awarded punitive damages if the court finds that the lender’s conduct was willful. You also may recover reasonable lawyers’ fees and court costs. Or you might consider finding other people with the same claim, and get together to file a class action suit.

    Report any violations to the appropriate government agency. If your mortgage application is denied, the lender must give you the name and address of the agency to contact.

    You can file a complaint regarding a violation of the ECOA with the Consumer Financial Protection Bureau. You can file a complaint regarding a violation of the FHA with the U.S. Department of Housing and Urban Development (HUD).

    For ECOA violations:

    Consumer Financial Protection Bureau


    For FHA violations:

    U.S. Department of Housing and Urban Development (HUD)

    1-800-669-9777; TDD: 1-800-927-9275

    Another words if you applied for a mortgage over 60 days ago, gave your income, they issue a commitment, but from that day to present keep adding on to the conditions after you keep resolving the ones from before, then by all means if after 90-120 later they deny you, go all out and hire the best lawyer there is, file every complaint you can, and let the underwriters explain to their higher ups why they are all being sued, and deal with all the conditions of complaints from fair housing to better business bureau and hopefully judgement awards.

    • Amen, Jim. My favorite is getting a letter from a very large, national mortgage lender saying the loan has been “fully underwritten” even before he appraisal has taken place. Then, about two weeks later they come back with a low appraisal or they come back with conditions that need to be met.

      The loan is either “fully underwritten” or it’s not. Why lie to all the parties. It does no good.

      I have had a client forced to produce his divorce decree from 20 years earlier. Even though there were high credit scores, plenty of current income and assets, all documentation in place. The underwriters still wanted to see a 20 years old divorce decree.

      It’s out of control and lenders lie to their clients (the borrowers) just to keep them on the hook until it’s too late for them to change to a lender who can get the job done.


        Nice to see someone else agree and that it is a terrible human experience for a buyer or buyers to have to go through. Although the few, but never the less it is happening right now.

  • Jannie Burgess

    So I am a little nervous. I have gotten my pre-approval..the house is almost completely built. Should be headed to closing in like 3-4 weeks. my mortgage broker has me worried because they are saying that I have disputes on my credit report, which I already called to have removed and that my dti is 41% … I have all of my closing money, down payment and money to spare…but I am worried the credit bureaus won’t remove the remarks in enough time (there are no open disputes on my report, but the remarks are there…I was using Lexington Law and the disputed EVERYTHING..and I guess the remarks were not removed. The things they are asking me to take care of now, I feel like should have been asked before I was even pre approved. Credit bureau says it could take like 30 days to get the remarks removed…#superstressed #sleeplessnights…Just want my home!

    • Good luck, Jannie. Credit repair isn’t quick or easy. If you’re working with a builder, my guess is they’ll be patient for awhile. Many times the house isn’t completed exactly on the day they promise, anyway. Keep plowing ahead. They should have asked you for stuff earlier but it’s not unusual for everything to pile up at the end.

      Keep the faith and keep giving the mortgage company everything they want.

      • Jannie Burgess

        Well I repaired my credit like 2 years ago and finally got up the nerve to go for the loan..and got the Pre Approval from the builder and who my loan is going through. I am just finding out that those remarks are still on my report even though I stopped all of the disputes back in July or August. I am just trying to keep calm..I was just as nervous in the pre-approval stages

      • Jannie Burgess

        evidently they can’t approve a loan with those remarks. the house is set to be finished by the end of the month..I am guessing they would want to close within 2 weeks or I get to pay penalties for not closing

        • Doesn’t sound very encouraging. I hope you can get the remarks removed.

  • Shortmama757

    I am reading the comments and I want to know what are my option. I been going through the mortgage process for almost three months. First the mortgage guy told me to save my money and to pay down my bills. Okay doing the pass three month I have gotten all my bills under the 30% like he said and save an addition 2000.00 with my downpayment of 2175.00. I also found a way to add an additional 900 to that. So after all of that he said that he wants me to pay my bills down to 10% and to pay off fingerhut and springleaf and to also pay my credit card down to 10 dollar. So I explain to him if I do that it would take the addition 2000.00 that I have save. He told me that it will be ok as long as I have the money for the downpayment and a little something extra. So I did what he said. Now the underwriter did not denied me he said that he want me to ask someone for 2000 dollar to put in a saving account so it look like I have additional money. He also want me to get whoever the person that give me the money to write a letter saying that it is a gift. Now I work at the loan place, tell me who is going to loan me 2000.00 and write a letter saying it is a gift. Now before this situation it was a problem with a dispute comment. I work on getting it remove for two week and while I was doing this he did not say nothing about wanting to get 2000 extra dollar. They told me that once the dispute comment is taking off then I can close. Now that I have gotten the dispute comment taken off now they want 2000.00 in a saving account. I feel like I am getting the run around. What should I do?

    • The first thing I would suggest is to find another loan officer and another mortgage company. Anyone who asks you to commit mortgage fraud by getting someone to lend you $2000 and say it was a gift is sending you down the wrong road.

      Many mortgage programs allow gifts but they need to be documented very carefully. Usually the gift comes from a family member.

      It also sounds like you have other issues such as a lack of money for a down payment and closing costs and some credit issues. These may not be something to keep you from getting a house but you need to find an ethical, truthful and helpful loan officer in order to get you the mortgage you need.

      • Shortmama757

        That’s what I was thinking that something is not right. I ask the mortgage guy if the odds are good because i did not want to waste my time and money, before I paid 500 good faith check to the company. I also ask again when I paid 500.00 for the appraiser and again when I paid 275 for the home inspection. I also spend over 2000 paying all the bills down to what they ask me. I am getting fed up and don’t know what to do. I have over 3000 in my account for the downpayment but when I add all the money I have spend I come up close to 6000.00 and this don’t include the amount i have save for the down payment. So should I wait this out or look some where else

        • It sounds like you may not get final approval for the loan. It is good that you paid down your bills. That is not wasted money. It is also good you have saved money for your down payment.

          The money for the appraisal is probably gone forever but you probably got your money’s worth from the home inspection and you won’t need to spend that money, again.

          The $500 good faith check (earnest money deposit) is probably still safe as long as it is with the buyer’s real estate broker (your agent’s company)

          I would still suggest looking for a reputable mortgage company. Your agent may be able to help you out with this. If not, you need to find someone who will help you and stay legal. You don’t want to go to jail for mortgage fraud. It is serious.

  • Julie Maxwell Allen

    Here is my problem FHA seems to have transposed someones social security number to mine in the original data entry phase. The mortgage it self is not in my SS. (not showing up in credit reports etc..) But before we close we have to have my social detached from that other FHA case # . IS this possible? has this happened before ? how do they fix it. thanks!

    • That’s a great question, Julie. I’m sure it’s possible but you really have to be on them like a pit bull to make sure they do it. We’re talking Government bureaucracy. Those guys move really slow…and they don’t really care.

      • Julie Maxwell Allen

        Thanks. all mortgages are shown on credit reports right? does this sound like a “typo” thank you again

  • Hannah Phillips

    Question how many times does the loan officer send your paperwork to underwriters? Does ta mortgage company order title work if it hasn’t went thru underwriting? The reason I asked is we got a preapproval and signed a contract in September. Appraisal is done, well test is done and so is the inspection. How ever we found are mortgage broker has not done anything he has said he has done . He said he got some conditions back when it was never sent to underwriters. What grounds do we have if this does not go through underwriters?

    • Hannah, It sounds like your mortgage broker has sent your loan to underwriting. Usually, “conditions” come from the appraiser if it is an FHA or VA loan and there are some physical conditions that need to be repaired at the house. If that’s not the issue, your mortgage underwriter will have “conditions” which could be any number of things ranging from re-verifying your employment, re-verifying your assets (like bank accounts), waiting on verification of your tax records from the IRS. Plus there are a ton more “conditions” that mortgage underwriters may need to be satisfied depending on the type of loan and what the ultimate “investor” (the entity providing the actual money for your loan) might have.

      I have had “conditions” pop up a day or two before settlement and delay things quite some time. Sometimes, they “conditions” derail the loan completely.

      However, it you really think your loan officer has not sent your loan to underwriting, I’d get on the phone to his manager or someone up the line. The loan processor may have dropped the ball.

      You also need to make sure that you have given the loan officer everything he has asked for. Missing documentation is the biggest reason things get held up. Even if you don’t think the loan officer should need the document or you don’t understand the relevance….give it to them.

      Remember the Golden Rule: those with the gold make the rules. In this case, if you want a mortgage you need to be very pro-active about getting them all the documentation they want and if you’re not getting the answers you want you need to go up the line or get a new mortgage company to do the loan for you.

      • Hannah Phillips

        Well we found out last week he hadn’t. He actually ended up getting fired for not doing anything. Here is my concern he has sent in an email that these were the conditions in which he has but to find out he has not submit it. We were to close on the 31st. He has ordered title work? What happens if this does not get approved should we have to pay for the title work? What is the likely hood of this getting approved based on what he has done or should I say hasn’t done.

        • Sounds pretty bad, Hannah. The best thing I can tell you is to consult with your Realtor and have him/her let you know how to proceed.

  • April

    Actually this is very accurate. And exactly what we are going through the currently.

    • Thanks for stopping by, April. Yep. Underwriting hasn’t changed much. It only gets worse.

  • Mindy Gordon

    Well Jody, Can you introduce some of those Lenders/Underwriters to me…??? I have been through a horrible process ongoing since last March. I would say this article is point on! I have done everything I was supposed to. The process took longer because the sellers did not do what was expected of them. So we lease/purchase and live in the home. Well we were approved and almost ready to close in April 2015, PENDING APPRAISAL, that of course I was worried about because I used to live in homes and flip and then the investor would sell and I made a nice little profit, point being I know what will and won’t work for Market Value and FHA…. The sellers rushed and rushed and just basically in her mind thought we should pay for sentimental value I guess… but that is not my problem and she should not have sold the home. Well when the appraisal didn’t come in, we had already sold land that I myself had purchased for an amount no one could turn down. I had made that investment to work toward another then another but I had to rush to sell the land because the lender had told me get this amount for the concessions and down payment etc. I thought I had more time than what I did but I had to let the land go and lost 15k from what I had expected. Then the appraisal flop… Which in the long run did us a favor because the seller totally misled us on serveral things and me living in the home doing the work needed to bring it up which I have over 15k in 6 months doing the work myself.I did everything my lender told us during that time. I kept an eye on the credit, I didn’t make any changes to that was so ever other than a credit card we keep open to help build. Well after the 6 month waiting period…. here we go again… still approved we pick back up and update everything, get the appraisal, now mean while in the 6 months our lender told us that any thing that we have put into the home, improvements and lease payment toward the purchase price, could be added to the purchase price and we could use that as our down payment. Being that we had to spend to bring up the value but still had $$ in the bank.We have well over 15k over the market value in the home that we were told we could use. We get all the way to the end and the underwriter kicks it out because the down payment didn’t show in the account….We were not given the opportunity to send supporting documentation, explanations, nothing, everything was no. Which, I still have not been told why!I feel we have been done very unfair because now we are stuck with no time to finish and the seller is putting it back on the market. I had little to no communication with lender, after requesting every other day. When I did all I was ever told things are great in underwriter then was told, they are sending to underwriter. The was told the down payment information, then they couldn’t do my loan because my account didn’t show the down payment. … Uh… sorry it’s not in there because my bank does not deposit equity acquired…. I was devastated and have been through pure hell, now about to get a divorce because my husband has left. I do not have a home and my husband won’t even try anywhere else. This was an FHA loan and I thought the program was designed to be able to help people,I tried another. Same information turned in and then we were told that the AUS, “Just didn’t like our file” and I was like I don’t think that is an answer, Tried FHA and a Rural, we were eligble and qualified for both. I am just ready to give up but I have worked so hard, and don’t know what to do. The seller is now going to try and boot me out so all my hard work that is absolutely gorgeous, might I add, is going to be for nothing and I am left with nothing except some little back payment I am sure. Seller has basically tried to screw me every which way she could.I am a hard working honest person that has lived and fixed everyone else’s homes, but this was the first time I was getting to have one of my own for my son and myself. I have busted my tail for 13 years as a single mom, his dad past when he was small, yes he is grown but this is the first time I have been able to give him a real home we were not going to have to move out of. I did keep everything with my agreement and the work done on the home but it isn’t going to be easy to get my $$ I have put in the home in order for my son and I , now on our own again to move. I wasn’t even prepared for any of this because I was always told everything is ok. So I am just lost, deperate, being pressured and harassed by the sellers realtor for information as to what I am doing, and I can’t answer the phone because I have no idea. We had 1 last route to take, but now that my husband is gone there is no way I could get it by myself. I don’t know what to do and need help! If anyone knows of anything I can do, please. I just don’t understand how all this happened, I don’t want to have to go through court system and all but I can’t leave empty handed, and I don’t have the money to put up for an attorney, or do I need one? Should this be reported and to who and on the company or who? See I am new at buying a home… I have researched but I am still scared. I really need help if anyone can offer ANY KIND of advice. …so yes, I am not very fond of underwriters so far , guess mine got a bad perm! Anything anyone can do, to help is appreciated. Thank you !

  • Shonna C.

    we were fully approved on Friday the 15th in the morning, they were suppose to prepare the closing disclosures and send them, but never got them friday and then Monday was MLK day so nothing monday, today nothing yet. There is the 3 day waiting period so had to switch our closing day from thursday 1/21 to friday 22nd. our Original close date was 1/25 – the loan office hasn’t got any response from the lender- I know, this is the fastest people have heard of closing. The reason I worry is we have to be out of apartment by sunday 1/31 @12p – getting a little nervous any advice

    • It sounds like you are on track. Many times the underwriter doesn’t communicate with anyone because they’re super busy trying to work through hundreds of cases just like yours. Still, with the new mortgage requirements mandated by the Federal Government (called TRID) you can expect your closing date to slip. Now, it’s not just one day. It’s three days….business days.

      • Shonna C.

        ok Makes sense thank you

  • Steven Simmons

    nearly lost our house to an underwriter clogging up the pipes. so as a borrower/home buyer this makes sense. the seller gave us a clear deadline. the underwriter was down to the very last hours before the deadline.

    • Welcome to my world, Steven.

      Unfortunately, even if there is a contractual deadline for settlement written into the contract of sale, the lender is not bound by the contract. The lender is not a party to the contract so they don’t really care. Underwriters only care about mitigating risks for the lender and keeping their job. It really doesn’t matter to them what is going on in the lives of people depending on them fishing their job in a timely way.

  • Greatestshowonearth

    I buy rentals and Some of these underwriters are idiots and so petty i been waitin on a clear to close for months they allways find smthng petty its like they find things to waste your time poor old lady im buying from has had to jump to loops just to get my loan to clear they made her clean her basement put up new doors throw out garbage in the yard window treatments all type of stupid things its getting quite ridiculous second time i use this lender never again.

  • Wamo

    I found twenty five dollars in an old pair of jeans and deposited it along with my paycheck.
    The underwriter asked me to write a letter explaining where the $25 dollars came from.


    Finding money in an old pair of pants is supposed to be a happy occasion! Only an underwriter could find a way to sap the enjoyment out of that.
    What’s next? Are they going to audit the change under my couch cushions?

    • Amazing, huh? I had an underwrite ask one of my clients for his “original” divorce decree from 20 years earlier. So, he had to track it down at the court house where he got his divorce. Talk about a monster pain in the butt.

      • Wamo

        Unreal. What does a twenty year old divorce have to do with anything?

        Verify income/employment and credit history, determine DTI then appraise the property. Those are all perfectly reasonable conditions that can safeguard against foreclosure and can be done in a timely manner.

        The financial strip search buyers are subjected to these days is so beyond that though. It’s absolute madness and serves no purpose other than to delay closing and jeopardize legitimate purchases.
        Real estate deals are stressful enough, having to stroke an underwriter’s God complex on top of it certainly doesn’t help.

  • Tiffany Urrutia

    Fantastic suggestions , Speaking of which , if anyone requires a Smart Recovery Meeting Attendance Verification , my wife filled out and faxed a sample document here

  • Scott

    These discussions hit close to home…..

    I began the purchasing process in February 2016 (re: inspections/radon/etc to make sure I wanted the house as I was buying from out of state). Preface things by saying I have a really great agent. Prior to inspections I was pre-approved for my full loan by the agents brokerage department. Seeing as this is an FHA loan during the month of March into April some work needed to be completed on the house before we could finish closing, which pushed closing to April 29th. So April 29th I verified funds in my account and sent over, for about the 10th time all the documents they wanted. Mind you I had sent them these documents so many times before and they kept telling me all I would need was to verify funds to close. Well the next Monday roles around and I get a Letter of Contingent Approval, once again the underwriter needed more documents, sent them over within an hour.

    Fast forward to the end of the week, still no word. Agent said he would follow up, but expected me to get a call Saturday to schedule the title paper work and that would be 3 days after to close, so Monday sign and get the keys Wednesday. Here we are Monday afternoon and still no update, still no call from the title company and looks like another week I won’t close.


    My purchase agreement ended on the 29th, can I walk away with my earnest money?

    Is it normal to be this long of a process and not a single person be able to give me an update beyond “we are working on it”? I mean I don’t even know how much money I need to close at this point.

    The fact that we are heading towards three weeks after purchase agreement, if I threaten to walk will that make them start working towards closing?

    At my whits end with this whole entire process, complete lack of explanation, no updates, constantly asking for repetitive documentation, and honestly ZERO professional courtesy.

    • Scott, I really feel for you. Getting financing for a house with the current underwriting restrictions is a long a difficult path. I wish I could answer your questions but your agent would be the best one to answer that.

      Options on releasing the terms of the contract and getting your earnest money deposit back vary from State to State. It really depends on what your Contract says and how willing the seller would be to release your deposit.

      It is not unusual for lenders and title companies to “go into hiding” when things go wrong. Generally, they are probably trying to get your stuff done but there are tons of other loans they are working on, too. This is no excuse, in my opinion, but it’s most likely the reason no one is talking to you — it’s because there is nothing new to report.

  • Fed Up

    Complete nightmare!! Buying a home has been the most horrible experience. All are responsible and have caused more delays and issues then I can count. Loan officer with over 25 years experience…Dont matter still didn’t produce in a timely fashion or keep her word on anything. Missing papers on closing??? WOW.

    Realtors who promise and promise to protect, only to deceive and lie as well. I can understand the underwriters have a protocol that they have to do. But waiting to the last minute to request documents that should have been done weeks ago. I’m sorry you overlooked it but how about answering your phone and emails so our escrow can close the deal. And let me guess since it’s friday, this will again roll into next week. 2 extensions ALREADY and over 60…still not closed.

    They do not care about the welfare of the buyer. We have jumped through hoops and bounds and here we sit with “No Keys” and a house full of boxes. Tell me how they do not know our suffering??? Our second notice to move with now only half a month left. Shall we become homeless?? When will I ever get one night of sleep again?? 2 months of pure hell and all at OUR EXPENSE!!!!

    • No question. Buying a house is no picnic. I usually try to prepare my clients for what to expect but you would be surprised at how many times it goes in one ear and out the other. Having said that, I know there are less than wonderful Realtors out there that couldn’t care less about their clients.

      It sounds like the main issue is with the underwriter, though, and that’s not surprising. They often wait until the last minute to ask for documents (many times documents you already provided) and check verification of income, assets, debt, employment and more. It’s sad because they don’t care a bit about the situation of the buyer or seller. They have a nice, warm house to go to at the end of the work day.

  • Cameron Bellomy

    I’m day 4 in “underwriting” right now. Fourth business day. I have 686 fico 3% DTI steady income and employment along with the wife. 60,000 in available credit for about 3 years. ( I don’t use credit cards) The only hiccup I had was I wrote off too much on my tax return and it looked like I made 5k last year. But all I wrote off was the mileage on my car. My wife has 700 fico. No debt at all and been at her job for 5 years. Her tax return was terrific. Please , anyone let me know what I’m looking at here. Oh yeah my only monthly obligation is my student loan which is at 8k and 140 a month.

    • You probably don’t want to hear this but your loan officer probably sent you down the primrose path. Both 686 and 700 and getting toward the low end of the spectrum and the underwriter probably sees a lot of risk. Even if you’re getting and FHA or VA mortgage which have much looser guidelines for credit scores, the mortgage company will still want to make sure you’re not the type of person who will default.

      I can relate about the tax returns. I’m a Realtor and I write off a ton of business expenses to the point it doesn’t look like I have any taxable income. Mortgage companies don’t like that. They like to see big, fat, taxable income.

      Bottom line: some mortgage underwriter who probably got around to working on your file two days before you were supposed to close is now trying to verify all your income, assets, debt, debt history.and lots more.

      Next time around, you really want to try and get your credit score into the mid-to-high 700s or even the low 800s. Then you can pretty much write your own ticket.

  • Mumbles488

    Im supposed to close on the 20th.
    My lender is still waiting on approval from underwriting…all ducks in a row.
    I’ve moved into and have been renting my home. Fingers crossed. This is insane.

    • You’re right it’s an insane process and the mortgage industry is doing nothing to improve it.

      Best of luck for an “on-time” settlement.

  • Sheree

    This article is so helpful as well as the comments:) I loved it, I see I’m not the only one. We’re trying to get clear to close and we had conditions that we already turned in. but had to turn so additional papers again. One of the conditions was, I had to write an explanation explaining why my parents address was on my credit report. The terrible thing is the loan officer makes you feel like you already got the loan but still no clear to close from the UW. we got an conditional approval, they wanted more bank statements. I feel guilty about spending money but its costing us a fortunate as we sold our previous home and we were staying in hotels which is expensive finally my parents were kind enough to let us stay in there basement . We’re trying not to use our closing money, but not having a home seems to be costing more than when we actually had our small home. The comments were very uplifting to know this is how underwriters work. now the wait continues, all you can do is keep it in prayer. (thanks Mr. Montville)
    Never ever ever want to go through this again!

    • Thanks for the nice words, Sheree. I can appreciate the hassle and expense you are going through.

      Many times a loan officer will tell their buyer client that a loan is “approved” when it is really far from approved. They are just saying that the income and debt and overall credit has checked out. Many times they say a loan is “approved” before an appraiser visits the property and long before underwriting has looked at the loan.

      It’s never over until the ink is dry on the settlement documents and underwriting can hold that up indefinitely. They frequently ask for duplicates of documents that you have already supplied. They look for any discrepancy between the application and anything they may uncover like being at your parents’ address.

      I’m sure it will eventually all work out. It just takes a whole lot longer than it should.

      • Sheree

        It sure does, Thank you!

  • Dianna

    I’m doing some research on mortgage underwriting and I stumbled on this old opinion piece. Ken says “Remember, though, the underwriters don’t care…” Wow, that’s quite the accusation. It’s unfortunate that I begin my post by saying that Ken Montville sounds bitter and emotional, but that’s
    how I read it. We all choose our path in life, including what we do for a
    living. The truth is both realtors and (typically) loan originators work on commission and
    that is the path they chose to go. Realtors and loan originators get paid only when they close a transaction, but don’t be fooled, it’s a high reward (yay…good for them!) business with lots of personal freedom from the “8 to 5” desk that the rest of us are tied to. On the other hand, underwriters work on an hourly
    and/or salary basis and, when in the business long enough, underwriter’s earn some serious bank too (yay!), and that’s the path those individuals chose to go. Also, please note that underwriters are paid on salary type basis because, for many reasons too numerous to list, it’s not ethical for them to work on commission. Also, it’s difficult (or, frankly, impossible) for anyone to call an underwriter directly. Again, this has a lot to do with ethics and fair treatment for all borrowers. However, (Ken) being bitter
    over the working hours and/or protocol of underwriters and implying underwriters are
    lazy because they are salaried, then implying that underwriters don’t care, and finally saying underwriters are the
    underbelly of a profession…is that a solution Ken? It is not. However, I agree with Jody Gomez that truly successful loan originators (and thank goodness there are many of them), put a solid loan package together from the get go. When a solid loan package comes to underwriting…booyah…it sails right through. On the other hand, when faced with a package that is missing documentation of any/all kinds, or with unanswered questions, i.e. no memos to explain certain “issues” etc., no matter how solid the deal is, those are the loans that seriously bog the system down. Those are the packages that even slow us from proceeding on to the next solid package. Then, if there’s a borrower and/or property that has a weakness (and heaven forbid if both the borrower and property are weak in a deal), it’s incumbent (100%) on the front-end team, the realtor (that’s you Ken), the originator, and the processor to produce a solid loan package for the underwriter’s review. Remember, the underwriter typically gets a file at the 11th hour and the pressure to meet everyone’s expectations is high. Also, when anything, and I mean anything goes wrong on a loan after it’s closed…who hears about it? Not the realtor and not the loan origination team, it’s the underwriter left to clean up a mess or explain what went wrong. Yep, the underwriter’s name is on the line. Then consider…who makes the rules? It certainly isn’t underwriters! Rather it’s the feds, the state regulators, the investors, the insurers/guarantors (whether federal or private), the servicer, or the lender itself. At the time of loan approval, it’s the underwriter left to juggle and comply with all those rules and regs at the end. If underwriting doesn’t get what is needed in the package to begin with (usually the day before closing…lol), then the there’s no choice but to ask for what they think (or absolutely know) meets compliance for all of the various areas they report to. Does one really believe that an underwriter wants to do that…keep all those parties hanging; ask for documentation that isn’t needed; keep a loan sitting in abeyance, and prevent everyone from closing? I can tell you no, they don’t, that’s not anyone’s idea of a good time. Finally, yes there are good and bad underwriters, just as there are good and bad realtors, loan originators, and loan processors, but from long experience as an underwriter I can say that I do care about borrowers and guess who else I care about? I care about my co-workers (the LO, processor, closer, etc.), the sellers, the title and escrow officers, the company I work for, and yes Ken, even the realtors. We are all trying to make a living in a heavily regulated industry, which means we must try to meet expectations from many different sectors and most of us try to do a good job for everyone. Ken, I submit that the solution is that everyone should take responsibility and if (as Jody suggests) a solid foundation is laid at the start of the loan process, then anything is possible and there’d be many more smooth and successful closings. I suspect Jody is a fabulous team player. I bet she thinks of the underwriters as partners rather than adversaries. She’s struck on the sure recipe for success for all of us. Kudos and best wishes for continued success to her and everyone she works with!

    • It always amazes me, Dianna, of all the blog posts I have written over the years, this one gets the most comments and they are always on the extremes of underwriters being the spawn of Satan or their archangels on the right hand of God protecting both consumers and investors (i.e. the money for mortgages).

      I’ve heard this song before. Underwriters are overworked and underpaid. Especially when compared to the evil and lazy loan originators who do nothing but go to lunch with potential referral sources (Realtors) or play golf and drive around in BMWs

      Before I switched my commenting system to Disqus to eliminate comment spam, I would get all kinds of interesting comments from underwriters who would call me names you wouldn’t say in front of your mother.

      But, I digress.

      Realtors and, I suppose, loan originators make a lot of money because, more often than not, the deal falls through. You may not believe this but I’ve worked with buyers for a year or more before they decided on a house and then another 45 to 60 days for the loan to close. My commission from those sales almost reach McDonald’s proportion.

      Oh. The freedom of not having to clock in from eight to five. Translate that to working with buyers, showing houses on evenings and weekends and holidays when they’re off work and have time to look for houses. Answering e-mails and phone calls late into the evening. Before eSignatures it meant going to people’s houses at 8:30 or 9:00 at night to get an offer together or presenting an offer to a seller

      But you don’t want to hear me whine. You want to tell me how wonderful underwriters are.

      Well, here’s something to think about. The loan is moving along. The originator has passed it to the processor who has passed it to the underwriter. You would think someone would catch some missing documents but, as you point out, all loans are different with different criteria, etc. But there are some things that are the same across the board.

      For instance, I’ve had a deal fall apart the day before settlement because, ooops, someone forgot to match up the tax returns from the borrower with the tax returns from the IRS. Of course, this could have been caught weeks ahead of time and the loan turned down and the seller wouldn’t have been all moved out and waiting for the funding from the house sale to make the down payment on his next home purchase.

      Instead, the seller had to suck it up. Pay for a hotel, pay for additional mortgage payments, additional HOA fees, additional utility costs, get the picture. All because some underwriter, ooopsey, didn’t do their job.

      On the buyer side, it’s even worse. You just have to read through the comments to see the heartache and stress buyers go through when they hear the day before closing that it’ll be another week or so. Or they need to provide documents they’ve already provided or they need to come up with and explanation why they were 30 days late on their Visa 5 years ago.

      Hell, I had one couple with high FICO scores, high income, high assets and a sizable down payment ready to go. The underwriter wanted to see a physical copy of a divorce decree from twenty years earlier!!!

      Buyers probably have the moving truck loaded up. They’ve given notice to their landlord or they’re trying to coordinate a settlement on another house. All of a sudden they have no place to live and no place to go.

      It’s a good thing no one can get through to the underwriters because they would have to deal with people crying and shouting and begging and demanding. Everything we Realtors have to listen to when we try to explain that “it’s in underwriting” and there isn’t anything we can do.

      Luckily, since this blog post was written in 2010, the Consumer Financial Protection Board has come into existence and on October 3, 2015 TRID (the TILA-RESPA Integrated Disclosures) went into effect forcing lenders to provide closing documents to buyers at least three (3) business days ahead of closing.

      This is still not the coveted “clear to close” and funds haven’t been wired to the title company but it puts a little bit of a fire under the underwriter’s tush to get things done and done right.

      Bitter? Maybe. Surely disappointed as hell that they system not only doesn’t work like it’s supposed to but it’s opaque as well.

      • Dianna

        Again, name calling and blame game aside. A viable solution to the problem is teamwork. Jody Gomez’s perspective as a loan originator impressed me. Good luck.

  • Whitney

    I have been a mortgage underwriter for 8 years and find this article very inappropriate. I fight tooth and nail to get our members approved. I don’t say “no” just to say “no”. I evaluate their ability to repay and previous evidence of willingness to repay their debts and come to a conclusion within industry guidelines. I find it laughable that a realtor (who has no mortgage lending experience) telling potential borrower’s how horrible underwriters are. Maybe you had a few bad deals where your clients didn’t admit everything that was wrong with their credit and suddenly a week before closing the deal fell through… (I’ll give you a hint: IT HAPPENS). Not because I decided to say “no”, but because the processors and loan officers were working diligently to get the appraisal, title, survey and income documentation. Then, when it finally came in 3 weeks after the loan application was submitted, the underwriter reviews it and discovers that they have a judgment and no assets to pay it off or that they went through foreclosure a year ago and think that they can just buy another house without consequence. Realtors, loan officers, processors, title companies, surveyors, appraisers and God forbid, even underwriters, are part of a “team” to help their client get the home of their dreams. If an underwriter tells you “no” it’s because you truly don’t qualify – not because I need to get home by 5pm. I work 50+ hours per week, solve problems that no one else can find answers to, review files within 48 hours of receipt and take work home when I get behind so that your client(s) can get the home of their dreams. Sure there are crappy underwriters, just like there are crappy realtors – but you’re saying all underwriters are evil and selfish and that is absolutely not true. Maybe go job shadow an underwriter and find one that you trust – then recommend your clients to that bank or credit union instead.

    • Whitney, unfortunately, my experience is more than “a few bad deals”. Before TRID it was the norm to have everything seem to go smoothly right up to the time an underwriter got around to working the file. That was usually the week before settlement.

      There is no reason underwriters can’t pull tax returns, verifications and credit reports that show exactly that types of things you’re talking about right up front. The fact is, underwriters don’t.

      Maybe they assume the file is going to be great since the loan officer and the processor are suppose to do the bulk of the work in advance. I’ve had underwriters ask for the weirdest stuff. All at the last minute.

      This isn’t just small Mom and Pop shops. It’s the big guys, the little guys and everyone in between. Underwriters always say they are just making sure everything is meeting the guidelines. Ok. Fine. How about doing the obvious stuff or the stuff that’s going to take a week or two to get back right in the beginning.

      But, noooooo.

      Everybody is thinking everything is going to be great until the last minute until “underwriting” decides the loan can’t be made.

      Oh. It would be sooo nice to be able to find that one underwriter who makes things work or finds the bad news fast and then use that one underwriter all the time. I would do it in a heartbeat. The fact is I can’t get near an underwriter. They’re all hidden in some far off city and can’t be reached by phone or e-mail.

  • Matt Smith

    Its strange how everyone is blaming an Underwriter for following guidelines set by the government and banks who have guideline overlays. Underwriters are just following guidelines set from the higher ups. If you dont like the guidelines blame your government (Fannie mae Freddie mac and FHA ….). Its like your blaming the solders for the war when u blame an underwriter. If UWs could ask for less documents it would only make there life easier why would they want to ask for anything that was not required by the guidelines. Educate yourself about the big picture before you post blame. The 2007 crisis only added more guidelines that most people wanted to prevent another mortgage crisis. If you want things to be easier ask the right people to make guideline changes. Also you are getting the biggest loan you will most likely ever get so lets keep things in perspective its not like u are buying a sofa. So dont get so upset providing a few documents for such a large amount of money. I am pretty sure most normal folks with that kind of money to lend would give a higher interest rate to mitigate risk.

  • Matt Smith

    Ken you clearly don’t know the guidelines and how the process works or you would submit clean files and know the issues coming down the pipe. I think you just want to shortcut doing the work which would present a file clean prior to submitting . You don’t do your homework to understand the gudelines that’s clear and u have never seen the process from the operations side that’s also clear. ONE of your complaints is the tax transcripts were not pulled up front. How do u know they did not. During tax season it takes time to get them back from the irs also if one little thing was wrong on the request it will be rejected and trust me people don’t always give u the correct information. I am sure instead informing yourself of the issues on the other side to solve it u immeditly posted blame and than no one wanted to help you because your viniger. Your vision is so short sighted and uneducated and this attitude is why your loans have trouble. You dont solve problems you just complain. I know loan officers who are on top of everything in the file and we’ll versed in the 1000 pages of guidelines for agencies and those are the winners your are just a whiner.

  • Lawrence M Reliford III

    So many lies, both in this article and in the comments… I feel bad for all the people out there reading through this crap and getting even more nervous about their own situations.

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  • micmart3000

    Wow, I cant believe I found this blog. The comments section has shined a light on the process for sure. I came here frustrated, anxious angry and thinking I was alone. I can see now that I an not nearly alone, Its clear that what me and my wife are currently going through while trying to buy our house is nothing more than business as usual. Closing date is tomorrow, I am told I must drive 2 hrs to retrieve a statement from the court that I don’t owe any arrears for child support. I have given notice and must leave our apartment, the seller has moved out and is in a hotel….same old story…

    • Yes, it is a sad story. Most underwriters don’t start working on the file until the very end of the process and then start to ask for all kinds of strange documents. I had a client that had the same issue. He had to drive to a court house and retrieve 20 year old divorce documents. His kids were grown, He had remarried. The whole nine yards but the underwriters needed to see it.

      • micmart3000

        Well it was craziness up to the final hour but we finally close today. 33 Day Escrow. I’m sure there have been a lot worse situations then ours, but its interesting how we all seem to be similar in the extreme stress experienced regardless of income or credit standing. There were three people in the bank with me this morning when I arrived at 9am to wire funds. We were all there for the same thing. One guy ran a business and was buying a second home. The other person was a woman who was buying a house and moving to Florida. We all shared our stories while the wire transactions were being processed. Everyone agreed that the stress was insane and the demands flat our crazy sometimes. I look at it this way, the lack of regulation gave way to the abuses that created the bubble. So the regulatory response was like a rubber band snapping back to the extreme opposite of the former situation. What seems to be needed is a system that finds a good middle ground between the situation now and the pre bubble conditions. I wonder what that would look like?

  • Shawn Kouchek

    this article is TRUE….underwriters dont really care about you or your mortgage… they dont care if you are stressed or loose sleep over your mortgage application…its black and white….no exception…either you are approved or they deny…conditional approval is NO guarantee and something else comes up down the road and they start to bug you again and eventually deny your approval…very stressful… nothing you can do except be calm…and accept the result and move on…if they deny you….its sad but true…underwriter can pick some TINY items from your tax, or debt and etc and use it against you. and then at the end, your LO just email or maybe call you letting you know that you have been denied and end of the story…

    • Thanks, Shawn. You’d be surprised at how many people are in the exact situation you describe. They’re excited about buying a home. They make all the necessary arrangements and then, at the last minute, underwriting comes back with a “no go” for some reason that could have been uncovered at the beginning of the process or has nothing to do with the creditworthiness of the borrower. It’s a damn shame and there is no remedy or recourse. You just have to deal with it.

  • Jon Day

    Well we are in a horrible situation with FHA and nothing we can do because nobody cares. We had a previous FHA loan that we unfortunately got foreclosed on due to job loss back in December of 2014. The sale of our house was on 12/2/14 for which I have the documents filed with the clerk to prove it. Well even though the deed changed hands and we should be eligible for a new FHA after the 3yr period December 2017 that is not the case. We found a place, signed a contract but because our FHA claim wasn’t closed out until 3/19/2017 MORE THAN 2YRS LATER!!! They say we cannot do a new loan until March of 2020!! This is just insane and with that being the case we may as well go with a regular lender because it will be 7yrs total and save money each month not paying all their fees. We worked very hard to get things back on track and were good in every other area until this popped up. How can that even be fair when we have documentation showing the deed changed hands but our old bank…wells fargo..didn’t close it out until 2yrs later. We are heartbroken and frustrated we now have to continue to rent for another 3yrs. Anyone ever come across this situation?