Final Approval

Once all the property reports are in hand, as well as the additional list of items required from initial underwriting, the file goes BACK to the underwriter for final sign off. At this point, the underwriter could fully sign off on the file as ready to fund, or possibly ask for additional clarifying documentation. Sometimes the documentation provided is insufficient or raises more questions or a need for an additional document etc. This is not uncommon, and we just provide what is needed at this time to get that full sign off.

The best practice for the mortgage process is that the underwriter only sees an application file two times, and step four, here, should be the second and final time. But as I mentioned, this is also the time where an underwriter’s initial “questions” about a borrower are not satisfactorily answered by whatever documentation was provided. So there may be some extended, more-detailed questions presented here. This part of the process is where things can sometimes go haywire, and borrowers can really get frustrated.*  But let’s assume that we’ve provided everything that was asked for, and any property issues from an appraisal or title report have all been addressed. This would be the moment where the underwriter “fully approves” the loan for funding.

* An underwriter may ask to clarify a bank statement, or if a gift fund was deposited. They may come back and ask for what seems like a very unnecessary document, but let me assure you that no underwriter is asking for something that they don’t have a very specific reason to ask for. Their job is to protect the lender that they work for, who is exposed to a great deal of risk in extending these large dollar amounts. They protect the lenders by anticipating what Fannie Mae might deem insufficient down the line when the debt is ultimately transferred there.