Credit Report Analysis By Mortgage Underwriters

Credit Report Analysis By Mortgage Underwriters During Loan Process

Gustan Cho Associates are mortgage brokers licensed in 48 states

This ARTICLE On Credit Report Analysis By Mortgage Underwriters During Loan Process Was PUBLISHED On February 9th, 2020

The borrowers’ credit report will be through a thorough credit report analysis by mortgage underwriters.

A 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

In this article, we will discuss and cover Credit Report Analysis By Mortgage Underwriters During Loan Process.

Underwriting Mortgage Process

Credit report analysis by mortgage underwriters will not just be an underwriter reviewing the 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 are not showing up on credit report
  • The credit report is a full personal and financial profile of borrowers

In the mortgage qualification process, the information on the 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 the 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 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 in the mortgage loan applicant’s credit report, it will affect DU FINDING and/or LP FINDINGS on determining the approval of the mortgage applicant.

Credit Report Analysis By Mortgage Underwriters And Errors On Credit Report

what is 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 a mortgage loan as well as other forms of credit
  • Some common errors that contain credit reports that affect a person’s ability to get a mortgage loan approval are dates that incorrectly reported

For example, here is a case scenario:

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

The borrower needs 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 the information updated on the credit please that in mind
  • Borrowers in a hurry to get credit report updated sooner, the 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 a home mortgage with a national direct lender with no mortgage overlays can contact us at Gustan Cho Associates at 800-900-8569 or text us for faster response. Or email us at We have no mortgage lender overlays on FHA Loans, VA Mortgages, USDA Mortgage Home Loans, and Conventional Loans.

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