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How long does underwriting take?

6 steps to closing on your new home

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Underwriting is a critical part of mortgage lending and typically takes anywhere from several days to a couple of months. Mortgage underwriting uses the borrower’s financial data and property information to determine loan approvals. This process begins with the mortgage application and ends just before the borrower closes on their home.

What is mortgage underwriting?

Mortgage underwriting is an in-depth examination of a loan applicant’s financial information and credit history and details about the property to determine the applicant’s qualification for a mortgage loan. The underwriter is responsible for analyzing the borrower’s credit, capacity to repay the loan and collateral to ensure the lender is making a financially sound loan decision.

For conforming loans, underwriters must follow lending guidelines set by Fannie Mae and Freddie Mac.

For loans to be conforming, the underwriter must follow lending guidelines set by Fannie Mae and Freddie Mac, government-backed enterprises that purchase mortgages from lenders and sell these loan packages as mortgage-backed securities (MBS) to investors.

An important part of underwriting is verifying the borrower's information on the application. Because the applicant could falsify this information (although this is illegal), the underwriter must investigate and verify every detail to ensure its accuracy.

They need to ensure the borrower’s income matches the amount they stated, for instance, with a pay stub or a W-2. Annual income is a big factor in helping the lender determine how much a borrower can comfortably afford to repay.

The entire underwriting process, from the time your application is submitted to the day you close on your home, usually takes between 30 and 60 days, but it can be shorter. You’ll probably want to start the application process as soon as you’re ready to start looking at homes.

Though many of the reviewers on our site report brief underwriting processes — from a few days to two weeks, in many cases — many factors can slow the process down. A reviewer from Arizona, for instance, said underwriting took “forever” because the appraisal team underappraised the home “by at least $20,000.”

The underwriting process

The underwriting process starts when you apply for a mortgage with a lender and ends when you receive the Closing Disclosure, a required form that outlines the terms of your loan. The process may vary slightly from lender to lender, but it tends to follow the general steps listed below.

1. Applying with a lender

First, you’ll submit a mortgage application to your lender. You can do this online (which may be quickest) or in person at your lender’s office. You’ll provide personal information like your name, address and Social Security number. You’ll also need to provide detailed financial information, such as your income and bank account balances.

Take your time when completing the application — you want to make sure the information you provide is correct. Your signature acknowledges that the information is both true and accurate to the best of your knowledge.

2. Verification of personal information and preapproval

Once you submit the application, your lender will require you to upload documents like W-2s, tax returns, bank account statements, etc. This lets the underwriter verify your income and other assets. When the underwriter has completed a review of your finances, you should receive a preapproval decision within one to two weeks.

Carefully reviewing your application for accuracy and promptly submitted requested documents helps avoid delays in the underwriting process.

Preapproval gives you an idea of how much home you can afford and lets you lock in an interest rate before you’ve found the perfect home. If you’re preapproved, you’ll receive a letter with information about your loan maximum, which you can use to make offers on homes. (Preapproval letters do have an expiration date, which is typically 60 to 90 days, depending on the lender.)

3. Appraisal

At this point, the underwriting process essentially pauses until you’ve found a home to buy and the seller accepts your offer. Then the underwriter evaluates the collateral on the loan (the home itself). They need to ensure the home is at least worth what you’re borrowing.

The underwriter will order a home appraisal conducted by a certified appraiser who inspects the home’s condition and compares it with similar homes in the area. The home appraiser will then report an assessed value to the underwriter, usually within a few days of the appraisal. In some cases, you may be granted an appraisal waiver if the home’s value can be determined through other methods.

4. Title search

The underwriter will also require a title search, which is a thorough review of public documents. The title search ensures that the home’s title can be successfully transferred from the seller to the buyer at closing. Depending on your state's requirements, you can hire a title company or a real estate attorney to complete the title search. This step in the underwriting process could take 10 to 14 days to complete.

Some steps can happen simultaneously, like the title search and the appraisal. This helps speed up the process.

5. Underwriting decision

The underwriter will reach a final decision once the title search and appraisal are complete. They may also require additional information from you at this time. For example, if the underwriter notices a recent large purchase, you may need to write a letter explaining the purchase or withdrawal.

In general, it’s best to refrain from making big purchases during the underwriting process because it could interfere with the approval decision. You’ll also need to refrain from opening new credit during the closing process. Underwriters will pull your credit report again just prior to closing to ensure there are no major changes.

If the underwriter is satisfied with the title search and appraisal results, you should receive a verified approval decision within a week or two. Some decisions may arrive sooner (within a few days), depending on how many applications the underwriter is currently handling. 

Once you receive verified approval, you’ll also get the Closing Disclosure to review before closing. This five-page document finalizes your mortgage loan terms; lenders are required to provide it at least three business days before the closing date. This gives you time to review the loan details before signing the agreement at closing.

6. Closing

The closing occurs on a specific date, usually 30 to 60 days after acceptance of the purchase offer. You’ll sign the Closing Disclosure and other legal documents, like the note. It’s important to note the cash-to-close amount detailed on the Closing Disclosure — these are the funds you’ll need to bring to closing (either by wire transfer or by cashier’s check).

How to speed up the process

If you want to ensure a smooth process, having good or excellent credit can help. Many lenders use automated underwriting to speed up the initial approval decisions. Automated underwriting instantly approves borrowers that meet or exceed the lender’s specified credit profile. Also, you’ll want to ensure that the information you provide on the application is both accurate and current — any discrepancies could result in your application being flagged and delayed.

To prevent delays, avoid any major changes to your credit once you start the underwriting process.

Even if the lender uses an automated system, some aspects of the underwriting process must be completed by an underwriter, like the verification of financial documents. You can speed up this part of the process by having these documents ready to scan (usually the lender will list these documents on the application).

Once you submit your application online, you can usually provide these documents right away through the portal.

Another way to speed up the process is to respond promptly to any requests from the underwriter. Often they’ll alert your mortgage loan officer if they need more information, but some will contact you through the loan portal, so you’ll want to log in regularly to check for requests.

You’ll also want to avoid opening new credit accounts during the underwriting process and before closing (this includes financing new furniture for your home). Your underwriter will pull your credit report again just before closing to ensure there are no major changes. Any new changes could delay or compromise your final approval.

FAQ about underwriting

What does an underwriter do?

The underwriter is responsible for closely examining your financial information and details about the property to determine your overall risk as a borrower. They must follow lender guidelines and federal regulations to determine loan eligibility.

How often does an underwriter deny a loan?

According to a report from the Consumer Financial Protection Bureau, the overall denial rate for home purchase applications was 9.3% in 2020. FHA loan applications had the highest denial rate, at 14.1%, while conventional conforming loans had the lowest (7.6%). In general, the most common reasons for denials are low credit scores and high DTI ratios.

What does final underwriting approval mean?

Final underwriting approval (also called verified approval) means the underwriter is satisfied with both the borrower's creditworthiness and the value of the collateral. Your loan terms are finalized (interest rate, maturity date, loan amount, etc.), and you’ll be able to proceed with the closing and purchase the home with your loan funds.

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    Bottom line

    Underwriting is a critical part of the mortgage process, determining whether you are qualified to take out a loan to purchase a particular home. Underwriting begins when you submit a mortgage application and ends just before you close on your home.

    The entire process usually takes from 30 to 60 days, and it includes steps like the appraisal and title search. You can help speed up the process by having excellent credit and promptly responding to the underwriter’s requests for information. You can avoid delaying your final underwriting approval by providing accurate information on your application and not opening any new credit accounts before you close on your home.

    ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. To learn more about the content on our site, visit our FAQ page.
    1. Federal Housing Finance Agency, “Fannie Mae and Freddie Mac.” Accessed March 21, 2022.
    2. Consumer Financial Protection Bureau, “Get a prequalification or preapproval letter.” Accessed March 20, 2022.
    3. Consumer Financial Protection Bureau, “Data Point: 2020 Mortgage Market Activity and Trends.” Accessed March 21, 2022.
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