Credit Report Analysis By Mortgage Underwriters During Loan Process


Credit Report Analysis By Mortgage Underwriters During Loan Process

Borrowers credit report will be through a thorough credit report analysis by mortgage underwriters.

  • Credit report contains the following information on borrowers:
    • employment
    • work history
    • date of birth
    • social security number
    • address
    • previous addresses
    • creditors
    • open credit accounts
    • closed out credit accounts
    • credit payment history
    • derogatory credit items such as late payments
    • public records such as bankruptcy, foreclosure, deed in lieu of foreclosure, short sale, judgments
    • collections
    • charge offs
    • credit inquiries other credit information
  • Credit report analysis by mortgage underwriters will not just be an underwriter reviewing credit report
  • Underwriters will also do a third party Data Verify check on public records
  • Public Records search is to make sure that there are no public records that is not showing up on credit report
  • Credit report is a full personal and financial profile of borrowers
  • In the mortgage qualification process, the information on credit report is used in the Automated Underwriting System to determine whether or not you are approve/eligible per DU FINDINGS and/or LP FINDINGS

Automated Underwriting System And Credit Report Analysis By Mortgage Underwriters

Fannie Mae’s and/or Freddie Mac’s Automated Underwriting System will be analyzing every aspect of credit report.

  • Automated Underwriting System is an automated approval system that determines whether or not a mortgage applicant is granted an approve/eligible for a home loan program
  • It is extremely difficult for a mortgage borrower to get a mortgage approval without getting an automated approval first from Fannie Mae’s or Freddie Mac’s Automated Underwriting System
  • The Automated Underwriting System will pick everything up from the mortgage applicant’s credit report
  • If there are errors on the mortgage loan applicant’s credit report, it will affect DU FINDING and/or LP FINDINGS on determining the approval on the mortgage applicant

Credit Report Analysis By Mortgage Underwriters And Errors On Credit Report

Every consumer should check their credit report at least once or more times a year.

  • The three credit reporting agencies;
    • Transunion
    • Experian
    • Equifax;

Not all credit reports are perfect. There are errors that contain on consumer’s credit report

  • Errors on consumer’s credit reports can affect their ability to get mortgage loan as well as other forms of credit
  • Some common errors that contain on credit reports that affect a person’s ability to get a mortgage loan approval are dates that incorrectly reported
  • For example, if someone had a bankruptcy discharge in March 2012 but the credit reporting agency is reporting the bankruptcy discharge date as March 2013, this will definitely affect the mortgage loan applicant
  • It can affect from getting a mortgage approval by the automated underwriting system because AUS will be picking up the March 2013 reporting date and not the actual bankruptcy discharge date of March 2012
  • There is a mandatory two year waiting period from the discharge date of Chapter 7 bankruptcy to qualify for FHA and VA Loans
  • The Automated Underwriting System picks all of its information from the consumer’s credit report

How To Correct Errors On Credit Report

If credit report contains errors, consumers need to correct them as soon as possible.

  • Borrower need to contact each of the three credit reporting agencies;
    • Experian
    • Equifax
    • Transunion:
  • Provide proof that they have the wrong information being reported
  • It normally takes between 30 and 60 days to get information updated on credit please that in mind
  • Borrowers in a hurry to get credit report updated sooner, mortgage lender can do a rapid rescore which expedites correcting credit errors on credit report in a matter of days
  • This normally costs about $100 per credit tradelines

Qualifying For Home Mortgage With Direct Lender With No Overlays

Borrowers who need to qualify for home mortgage with a national direct lender with no mortgage overlays can contact us at The Gustan Cho Team at USA Mortgage at 262-716-8151 or email us at We have no mortgage lender overlays on FHA Loans, VA Mortgages, USDA Mortgage Home Loans, and Conventional Loans.

Gustan Cho

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