What underwriting is
Underwriting is the lender's detailed review of your loan. The underwriter checks that you can afford the payment, that your documents match what's in your application, and that the home supports the loan.
It happens after you're under contract and have applied. Pre-approval looked at the basics. Underwriting confirms them.
What's reviewed
- Income and employment: pay stubs, W-2s or tax returns, and a check that you're still employed
- Assets and reserves: bank and retirement statements, and where your down payment comes from
- Credit: your full credit report, payment history and debts
- The property: the appraisal and the title search
Conditions and how to clear them
Most loans come back with conditions: items the underwriter needs before final approval. Common ones include a letter explaining a large deposit, an updated statement or proof that a debt is paid off.
Send what's asked for as soon as you can, and send the full document, including all pages if requested. Clear, complete answers keep the file moving.
How the appraisal and title fit in
While your documents are reviewed, the lender also checks the home. The appraisal confirms the home's value supports the loan amount. If it comes in low, you, the seller and your agent may need to renegotiate or adjust the down payment.
The title search confirms the seller can transfer clear ownership. Liens or errors found here are usually resolved by the title company before closing.
How long it often takes
Underwriting often takes a few days to two weeks. Simple files can move fast. Self-employed income, gifts or appraisal questions can add time.
Your loan consultant can tell you where your file stands and what's still outstanding.
Things to avoid until closing
Lenders often recheck your credit and employment shortly before closing. Changes can delay or even stop the loan.
- Opening new credit cards or loans
- Making large purchases, like a car or furniture, on credit
- Changing jobs without talking to your loan consultant first
- Moving large sums of money you can't document
After approval
When all conditions are cleared, your loan is clear to close. You'll receive your Closing Disclosure at least three business days before closing, so you can review the final terms and costs.
With CapCenter, your full credit check happens once you're under contract. Before that, pre-approval uses a soft check that doesn't affect your score.
