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 Underwriting from Lender?
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Posted on 10-18-16 3:59 PM     Reply [Subscribe]
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can anybody explain me in simple way what is underwriting and its pros and cons?, my lender recommend me put offer for a house with underwriting so it ensure seller he/she is strong buyer (more likely get property when there is multiple offers)?
Posted on 10-18-16 8:23 PM     [Snapshot: 134]     Reply [Subscribe]
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An underwriter is pretty much the last guy that makes a determination on your loan. Most buyers go with pre-approval from a lending institution, but they are subject to further credit check, debt-to-income ratio verification etc among other checks. Once a contract is signed, the loan application is submitted to an underwriter who approves/rejects loan.

In a very competitive market (2005-2006), it was hard to find a good house for decent price - total seller's market. In that case, to get an upper hand amongst other buyers, lenders would suggest buyer get bank's formal approval - not just a simple pre-approval. I had never heard getting underwriting when making an offer, but perhaps this is also exercised. Hard to fathom, though, that a lender would give you underwriting before even seeing a serious contract in place. But then again, I am not a real estate expert.

If your real estate market is super hot then go for it if a bank provides. I doubt around this time of year, that would be required though. No-contingency offer would trounce any underwriting offer IMHO.
Posted on 10-19-16 1:24 PM     [Snapshot: 288]     Reply [Subscribe]
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Thanks for helping me to understand about underwriting.

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