Underwriting is when a lender determines your creditworthiness — how risky it would be to lend money to you or how likely you are to pay back your loan on time. The lender approves your loan if it decides you are a reliable borrower. A mortgage underwriter verifies the documents you submit to the mortgage broker for loan approval including your identity, credit history, income, cash reserves, debts, and investments.
You can get a job as an underwriter with just a high school diploma with classes in mathematics, statistics, business, accounting, and economics, in addition to communication-related courses like English and speech classes with history, social sciences, and other humanities subjects.
Most employers, however, prefer to hire someone with a bachelor’s degree in business-related fields like accounting, finance, business administration, and others. At entry-level positions, new underwriters also get trained for their roles on the job for three to six months.
After getting the job, it is important to keep yourself updated with the latest knowledge, skills, and training. The National Association of Mortgage Underwriters (NAMU) offers different classes like Mortgage Underwriter 101: The Essentials, Commercial Processing and Underwriting 101, Advanced Commercial Processing and Underwriting, and Due Diligence: Learn Manual Underwriting. Private companies like Fannie Mae also offer various professional development classes.
The American Bankers Association and NAMU also offer a certification course for underwriters, each of which has its course completion mandates.
You also need three to five years of experience in fields like loan processing and credit analysis. Since underwriters directly interact with colleagues and other external financial institution representatives, they also need to have great communication skills. Underwriters need to be familiar with fair lending practices, loan processing, industry lending guidelines, and basic technical skills of working with digital software to enter and maintain records.
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