Mortgage 101

Do Loan Officers and Underwriters Work Together?

By Jessica Brita-Segyde on May, 13 2022
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Jessica Brita-Segyde

Yes, loan officers and underwriters do work together, but with intentional boundaries in place. Both of these roles are essential to the mortgage industry and communication between them is necessary for a smooth loan transaction.

Why are boundaries needed? The underwriter’s unbiased opinion is important in every loan transaction and to the integrity of the overall mortgage industry. While the underwriter and loan officer can be located in the same office, the loan officer may not attempt to influence the underwriter’s decision. The loan officer may provide information to the underwriter and ask questions regarding reasons for approval or denial. The underwriter may offer an explanation regarding conditions for closing and/or approval and may provide general education to the loan officer about loan guidelines.


What Do Underwriters Do?


Let’s start with what they don’t do. The underwriter’s job is not to approve loans, or “get them through.” The underwriter does not seek new business for the lender or sell products to borrowers. Rather, the underwriter’s role is to make sound lending decisions. This is to ensure that the lender’s book of business is good and saleable on the secondary market. The lender’s history and reputation matter within the industry. The quality of loans also matters - as defaults are financially detrimental to various parties, including the lender, secondary market purchaser, loan servicing company, and corporate and individual investors. Also, government-sponsored enterprises like Fannie Mae and Freddie Mac will only guarantee loans if they are underwritten to conventional guidelines. The Department of Housing will only insure loans that are underwritten to FHA guidelines, and so on. Lenders have to answer to many stakeholders and the underwriter’s decisions are heavily regarded. The market needs to know that the lender is doing everything they can to ensure sound, unbiased credit decisions.


Here is a quick snapshot of what the underwriter does after the loan officer takes an application: The underwriter reviews documents, determines the risk level associated with making a loan, assesses the need for insurance and determines appropriate coverage, and screens for fraud. The underwriter works with a loan processor to gather necessary documents and may request updated documents if needed. This request is usually made via the loan officer, who works with the applicant-borrower. It is unlikely that the applicant-borrower will ever have contact with the underwriter. The underwriter also works with the appraiser to determine the value of the loan’s collateral and may send questions or documentation requests to the applicant(s) via the loan officer.


What Do Loan Officers Do?


The loan officer is the applicant-borrower’s main point of contact at their lending institution. A loan officer’s responsibilities include marketing loan products and/or the lending institution to the public, meeting prospective borrowers, taking applications, collecting documentation, and working with the buyer to obtain loan approval and closing. This will probably result in some level of communication between the loan officer and the underwriter, even if they do not work in the same office or for the same company.


In some cases, the loan officer works to educate the applicant on the market and the approval/denial conditions that the applicant must navigate. The loan officer also communicates with other parties to the loan transaction, such as the appraiser, Realtors, and title agent.


Benefits of In-House Underwriting


When an underwriter works directly for a lender, this is called “in-house underwriting.” Having multiple parties to the loan transaction under one roof, even if it is a work-from-home virtual roof, can expedite the process. Loan officers are in the business of customer service and want to make things easier on their clients whenever they can.


The sooner the underwriter has a loan package, the sooner he or she can begin to review it. During the review process, questions might come up and conditions will need to be cleared. For example, the underwriter might notice a recent, large deposit into the applicant’s savings account. In this case, the underwriter could approve the loan with the condition that the source of this deposit can be explained and verified at least three days before closing. Conditions like this can be resolved more quickly when the underwriter and loan officer are within close proximity to one another. The time a loan spends in underwriting and pre-closing phases can be reduced, possibly allowing the borrowers to schedule closing sooner than if origination and underwriting happened at separate organizations.


What Can I Do to Help Get My Loan Approved?


Be thorough, be honest, and get your documents in on time.


Be Thorough - Mortgage loans applications usually begin with the Uniform Residential Loan Application (URLA). It covers all the basics: Name, address, employment, income, bank accounts, investments, and credit history. The URLA also requires that you disclose any properties you own and give an address history. You will also be asked for demographic information. Be thorough in filling out this document as undisclosed information could delay or prevent loan approval.


Be Honest Be honest and open with your loan officer. Their job is to find the best loan possible to fit your real estate needs.


Get Your Documents in on Time Time is of the essence in real estate transactions. There are some things that neither your Realtor nor your loan officer can do on your behalf. The underwriter could request updated documentation at any time. Your prompt response will help all parties get to the closing table on time.


How Do I Apply for a Mortgage?

Visit to find a loan officer in your area. With seventy locations across the United States, Ruoff Mortgage is ready to serve your homebuying needs. Check out our loan calculators to see how much house you can afford, and take a look at our helpful guides to learn more about the mortgage process.