What Are TBD Property Underwriting Mortgage Loan Approvals

This BLOG On What Are TBD Property Underwriting Mortgage Loan Approvals Was UPDATED On November 12th, 2017

TBD Property Underwriting Explained:

Most mortgage companies will not start processing and underwriting a mortgage loan until a borrower has an executed real estate purchase contract.

Here is how a traditional home loan process works:

  • Home Buyer contacts mortgage loan originator to get qualified
  • Loan Officer will take mortgage loan application, commonly known as the 1003
  • Loan Officer then reviews the 1003 and runs credit on borrower and/or borrowers which includes non-occupant co-borrower
  • Depending on the loan officer, a loan officer can issue a pre-approval then or proceeds to the next step
  • The next step is collect mortgage documents to process mortgage loan like the following:
    • 2 years tax returns
    • 2 years W2
    • 60 days bank statements
    • 30 days paycheck stubs
    • Other documents
  • Loan Officer then runs the file through the Automated Underwriting System for an Automated Approval 
  • If the loan officer gets an automated approval, the loan officer can issue a pre-qualification letter 

A pre-approval letter should not be issued by a loan officer. The Gustan Cho Team at USA Mortgage, all pre-approvals are issued and signed off by a mortgage underwriter at USA Mortgage. All pre-approvals are full credit approvals which is also referred as TBD Property Underwriting On Mortgage Loans

What Are TBD Property Underwriting Pre-Approvals Versus Pre-Approvals Issued By Loan Officers

Over 75% of our borrowers at The Gustan Cho Team at USA Mortgage are the following types of borrowers:

  • Mortgage Borrowers who gotten a last minute loan denial by other lenders
  • Borrowers who are getting the run around by their current lenders and are stressing over their current mortgage process where they are about to give up

There is no reason why a mortgage borrower should get a mortgage loan denial or stress during the loan process with any lender if borrowers have a solid pre-approval letter and the file is fully underwritten by a mortgage underwriter:

  • The sole reason for last minute mortgage denials and/or stress during the loan process is because the borrower was not properly qualified by their loan officer.
  • The pre-approval process is the most important phase of the overall mortgage process.
  • Loan Officer should not issue pre-approvals.
  • All pre-approvals should be issued by mortgage underwriters like it is at The Gustan Cho Team at USA Mortgage.
  • The reason we have a 100% track record of closing on all of our pre-approvals is because all of our pre-approvals are signed off by our mortgage underwriters.

TBD Property Underwriting Mortgage Process

We now can process TBD Property Underwriting mortgage loan applications. All TBD Property Underwriting approvals are full credit approvals underwritten and signed off by our mortgage underwriters.

  • Once borrowers files are TBD Property Underwritten, they get a conditional mortgage approval.
  • With a conditional mortgage loan approval, the only condition missing is the real estate purchase contract.
  • With a TBD Property Underwriting conditional loan approval, the home buyer can shop for a home and enter into a real estate purchase contract.
  • Once the home buyer has an executed real estate purchase contract, the property is then underwritten and a clear to close is issued.

TBD Versus Traditional Mortgage Underwriting

  • Traditionally,  mortgage lenders require that the mortgage loan borrower enter into a real estate purchase contract
  • The mortgage process then starts
  • The file gets into processing and underwriting 
  • Without a signed real estate purchase contract, the mortgage approval process does not begin
  • However, with TBD Property Underwriting, home buyers can get their mortgage loan application processed and underwritten as a TBD Property Underwriting and get a conditional loan approval
  • This means that the borrower is fully credit approved and the only condition missing is the real estate purchase contract

Benefits Of TBD Property Underwriting

One of the major benefits of submitting a mortgage loan application as a TBD Property Underwriting versus the traditional way of underwriting a home loan is that borrowers have a sense of security. This is because mortgage borrowers know that the mortgage loan application has been fully processed, underwritten, and approved. The only condition left is to enter into a real estate purchase contract.

  • The traditional way, where home buyers enter into a real estate purchase contract and the mortgage loan application then is submitted for processing and underwriting, poses a possible risk of a mortgage loan denial or stress during mortgage process
  • TBD Property as a subject property mortgage approvals is best suited for those home buyers with marginal credit or who border line approval mortgage loan borrowers
  • Although a mortgage loan borrowers gets an approved eligible per DU Findings, there is always a possibility of a mortgage loan denial with many other lenders due to their lender overlays
  • For those mortgage loan borrowers who have limited assets, high debt to income ratios, limited credit tradelines, late payments after a bankruptcy and/or foreclosure, recent overdrafts, no rental verification, open collection, or other derogatory issues, TBD Property as a subject property is the best way to go

The Gustan Cho Team at USA Mortgage is a five star national direct lender with NO OVERLAYS on government and conventional loans. All of our pre-approvals are TBD Property Underwriting Full Credit Approvals. We close on all of our pre-approvals. Home Buyers who needs a five star national direct lender with no mortgage lender overlays, please contact us at 262-716-8151 or email us at gcho@usa-mortgage.com. We are available 7 days a week, evenings, weekends, and holidays.

Gustan Cho NMLS ID # 873293

Related> TBD Property Mortgage Process

Related> TBD Subject Property Underwrite

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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