Can a Loan Officer Influence Underwriter?

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Loan officers and underwriters are both essential to the mortgage industry and the home-buying process. But can a loan officer influence the underwriting process? An underwriter must maintain an unbiased opinion when it comes to evaluating the risk potential of a loan. For this reason, the interaction between a loan officer and an underwriter is limited to a simple transfer of the borrower’s facts and data. A loan officer may not attempt to influence the underwriter.

Key Takeaways

  • Loan officers and underwriters are both crucial roles in the home buying process.
  • An underwriter evaluates the risk of approving a borrower for a mortgage based on factors such as credit scores, LTV ratios, DTI ratios, and property value.
  • A loan officer must not attempt to influence the underwriter, but can aid the underwriting process by providing clear information, staying up-to-date on guidelines, and providing accurate information.
  • The underwriting process involves pre-approval, income and asset verification, property appraisal, title search and insurance, and making a lending decision.
  • Loan officers and underwriters work together to ensure that the necessary documentation is gathered for the underwriting process to move forward.

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Loan officer vs. underwriter

A loan officer and an underwriter are two different positions that play crucial roles in the loan process. Here we take a closer look at each role and exactly what their part is in the home buying process.

What do loan officers do?

A loan officer is the one that works directly with a borrower, connecting them with a lending institution for their mortgage. Loan officers meet with prospective borrowers, take applications, gather all the necessary documentation needed for loan processing, and work with the borrowers to ensure they have everything necessary to obtain loan approval. A loan officer is also a source of education for potential borrowers, helping them understand the loan process and what they need for loan approval.

What do underwriters do?

Once a loan officer receives an application and gathers the necessary documents, everything is passed to the underwriter. The job of the underwriter is to review all documentation and determine the risk level associated with the borrower. Oftentimes the underwriter will contact the loan officer if they need additional information from the borrower to make their determination. When determining the potential risk, an underwriter will look at things such as credit scores, LTV ratios, DTI ratios, and the value and type of property being purchased. In addition, an underwriter works with the appraiser to determine the actual value of the property which will be the collateral for the loan.

How do loan officers and underwriters work together?

Loan officers and underwriters do work together but from a distance. A loan officer works directly with the borrowers and provides the necessary information to the underwriter, who then evaluates the information. A loan officer must not attempt to influence the decision of the underwriter. As far as interaction, a loan officer provides the information and can ask questions about an approval or denial and an underwriter can provide an explanation about their loan decision, as well as provide educational information about the loan guidelines and what is required for loan approval.

What is mortgage underwriting?

Mortgage underwriting is a part of the home loan process where an underwriter evaluates the risk of approving a borrower for a mortgage. During this process, the underwriter looks for stable work history, the borrower’s ability to manage credit and repay the loan, whether the property’s value supports the loan amount, and the current market conditions, such as a stable economy and job market.

The mortgage underwriting process

The underwriting process varies from lender to lender, however, there are five main components to the underwriting process. Keep in mind that underwriting can be a long process but having the necessary documents ready and included can help speed up the process.

1. Pre-approval

In most cases, a borrower will begin the underwriting process with a pre-approval. With pre-approval, a borrower provides financial information, such as income, debts, and credit history. The lender evaluates this information and provides pre-approval for the amount of financing they qualify for. Keep in mind that this is not a guarantee for a mortgage and additional steps will be necessary to obtain a mortgage.

2. Income and asset verification

Income and asset verification occurs both during the preapproval process and the underwriting process once the borrower makes an offer on the home. When evaluating this information, the underwriter looks at documents such as tax returns, bank statements, investment accounts, employment history, and much more.

3. Appraisal

Once the borrower finds a home within their budget and makes an offer to the seller, the underwriter will conduct a property appraisal. The appraisal looks at the property condition and comparable homes in the area to determine whether the amount offered to the seller is appropriate. If the home is valued well under the sales price, the lender is unlikely to approve the mortgage.

4. Title search and insurance

A title company performs a title search on the property in order to ensure that there are no legal claims against the property by another person or lender. This can include liens, mortgages, easement rights, zoning ordinances, unpaid taxes, and more. Once the title company determines that the property is free from legal claims, a title insurance policy is issued in order to protect the lender.

5. Making a lending decision

Once all the information is gathered on the property and the borrower, the underwriter thoroughly reviews all the information to determine whether or not to approve the application for a mortgage. At this stage, the underwriter will approve, deny, or request additional information that is necessary to make a decision.

How loan officers can aid in the underwriting process

While a loan officer cannot influence an underwriter in any way during the underwriting process, there are some things a loan officer can do to help aid the underwriting process.

1. Writing cover letters

When submitting a loan application to the underwriter, you want to make sure that all the information you provide them is clear and easy to understand. Include a simple cover letter that summarizes the information included, explains anything that may appear unusual, or explain a borrower’s story. This will help provide information to the underwriter upfront and saves multiple questions that may require answers throughout the process.

2. Staying up-to-date on guidelines

As a loan officer, you must stay up to date on loan guidelines, such as document expiration dates. Gathering the necessary documents is essential for the underwriting process and it is important that, as a loan officer, you are submitting documents that meet specific guidelines. If submitted documents do not meet these guidelines, the underwriter will need to request additional information, prolonging the underwriting process.

3. Providing accurate information

Before submitting an application to the underwriters, loan officers must ensure they have the most accurate and complete information on the borrower. For example, if a borrower has listed additional income from self-employment, real estate income, child support, or alimony, you will need to include additional documentation when submitting a loan. Taking the time to gather and provide this information from the start helps expedite the underwriting process.

Challenges in Collaboration

Collaboration between loan officers and underwriters is essential for a smooth loan transaction. However, there are several challenges that can arise during the collaboration process. Here are some of the most common challenges you may encounter:


Effective communication between loan officers and underwriters is crucial for the success of a loan transaction. Miscommunication or lack of communication can lead to delays or even loan denials. Loan officers must provide accurate and complete information to underwriters, while underwriters must communicate any missing information or concerns to loan officers promptly.

Conflicting Goals

Loan officers and underwriters may have different goals when it comes to a loan transaction. Loan officers are often focused on closing the loan quickly, while underwriters are focused on mitigating risk. This can lead to tension and conflict between the two parties. It is important for both loan officers and underwriters to understand each other’s goals and work together to find a solution that meets each parties’ needs, including the needs of the borrower.

Regulatory Compliance

Loan officers and underwriters must comply with various regulations when processing a loan. Failure to comply with these regulations can result in penalties and legal consequences. 

Volume of Work

Loan officers and underwriters often have a high volume of work to process, which can lead to burnout and errors. It is important for both parties to manage their workload effectively and communicate any concerns or issues to their supervisors.

New Technology

The mortgage industry is becoming increasingly reliant on technology, which can be a challenge for some loan officers and underwriters who may not be familiar with the latest software or tools. It is important for both parties to receive adequate training and support to ensure that they are able to use technology effectively and efficiently.

Loan officers and underwriters working together

While loan officers and underwriters each play an independent role in the home buying process, they must also work together to ensure that the necessary documentation is gathered to allow the underwriting process to move forward. A good underwriter will work to educate the loan officers on the documentation that is necessary for each possible scenario and, to expedite the process, the loan officer works to ensure this necessary documentation is gathered.

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