Automated underwriting is a computer-based method that enables mortgage lenders to process loan applications in a quick, efficient, objective and less costly manner. The information you provide is fed into the lender s computer and transmitted to an automated underwriting system, such as Fannie Mae s Desktop Underwriter. The automated system evaluates different pieces of information and gives the lender a recommendation about whether or not the loan meets the approval criteria. The lender considers the recommendation and other information to make a final decision. It s important to know that the lender, not the computer, makes the decision.
Speed is one reason.
The review and approval is much faster. Objectivity is another advantage of automated underwriting. Your ability to manage credit is an important factor in determining if you will repay your mortgage loan. Before you apply for a mortgage loan, you should obtain a copy of your credit report to make sure it is complete and accurate. A credit score might more accurately be called a credit bureau score.