In this brief guide, we are going to answer the question “how long does the underwriting process take for a mortgage?”

You may be wondering about the mortgage underwriting process as you are about to apply for a mortgage or maybe you are currently undergoing a mortgage application.

how long does the underwriting process take for a mortgage?

The underwriting process for a mortgage can take on average 3 weeks to complete.

What is the mortgage underwriting process?

The mortgage underwriting process is the key stage that is undertaken by a mortgage underwriter once you have made your mortgage application.

The mortgage underwriting process determines if you will be approved for a  mortgage or if your mortgage application will be rejected.

During the mortgage underwriting process, the mortgage lender will assess your mortgage affordability for the mortgage product by looking at:

  • Your credit score
  • The property
  • How well you match the mortgage lenders criteria

The mortgage underwriting process happens in each mortgage application and the mortgage underwriter will either approved or reject your mortgage application based on the information you have provided.

If the information you have provided changes due to a change of circumstances, then it is your responsibility to inform the mortgage lender as soon as possible.

Some of the mortgage underwritings may be done by machines whilst the rest is done manually.

Automated Underwriting vs. Manual Underwriting

With automated underwriting, you will essentially input data into an application form and this will be checked and cross-referenced with the mortgage lenders criteria by the mortgage lenders automated decision-making system.

This system will likely pull your credit score data and run a credit check to see if you meet the mortgage lender’s minimum mortgage affordability criteria.

On the other hand, manual underwriting involves an individual reviewing your mortgage documents to determine if you meet the mortgage lender’s mortgage affordability criteria.

The mortgage underwriter may request more documents from you and ask you follow-up questions in order to understand your mortgage affordability.

Manual mortgage underwriting usually helps those who have complex mortgage cases but there are mortgage lenders who manually underwrite all mortgage applications or some parts of all mortgage applications.

What does a mortgage underwriter look for?

A mortgage underwriter looks at your mortgage application and mortgage documents in order to understand if you can afford the mortgage.

The mortgage underwriter will look for:

  • Your disposable income
  • How stable your employment is
  • How reliable your income is
  • If there could be any future changes to your finances 
  • If you have any dependants, how many, how long they will be dependents and if you are expecting to have more
  • Anything that could affect the value of the property
  • If your mortgage deposit meets the mortgage lenders loan to value requirement for your mortgage
  • If you meet all the mortgage lenders product requirements

The documents the mortgage underwriter will look at to determine some of the above will mostly be documents you have submitted as supporting documents when you made your mortgage application. These include:

  • Bank statements
  • Tax returns
  • Payslips from your employer

The mortgage underwriter may come back to you with further questions or when they need more clarification on things that you may include in your mortgage application.

The underwriter may also request further information in order to assess your suitability for the mortgage.

The faster you respond and get back t the mortgage lender, the faster your mortgage application process will be.

The steps of the mortgage underwriting process

The steps of the mortgage underwriting process include:

In the  mortgage underwriting process the  mortgage underwriter will look at a key few things:

Fraud checks:

The mortgage lender will usually do KYC (Know your client) checks such as money laundering checks, fraud checks with CIFAS etc to ensure you are not on any negative lists.

Mortgage score card checks:

The mortgage underwriter will look at the various elements of your mortgage application and give you a score on if you meet the mortgage lenders policy and criteria for that particular mortgage product.

The mortgage underwriter does this by looking at:

  • your mortgage deposit, 
  • the property type, 
  • your income, 
  • age, 
  • number of dependents 

and other such factors to determine how well your meet the mortgage lenders requirement for the mortgage product.

This part of the mortgage underwriting process will not take too long as it is mostly done by an automated system.

Your income verification🙁 72 hours)

The mortgage underwriter will aim to verify the income you stated on your mortgage application to ensure that you have sufficient income to afford your monthly mortgage repayments.

If the income you have stated on your mortgage application is not identical to what the mortgage underwriter finds on your supporting documents then your mortgage application may be declined.

Mortgage valuation(48 hours – 1 week)

The mortgage valuation will also be a key part of the mortgage underwriting process but is usually very brief and does not affect how long the mortgage underwriting process takes..

The mortgage valuation is done to ensure that the mortgage lender is lending on a property that can be used as sufficient security for the mortgage.

If your property is valued much lower than the price which you are paying for it then the mortgage underwriter may reject your mortgage application as part of the mortgage underwriting process.

You will usually have to pay for the mortgage valuation. This can range from £50 to £300.

Conveyancing (2 weeks – 6 weeks)

Conveyancing is a key part of the mortgage underwriting process and it is one of the main steps that affect how long the mortgage underwriting process could take. 

The mortgage underwriter will liaison with your conveyancer and the lenders conveyancer to ensure the title on your property does not have any restrictive covenants.

If the mortgage underwriter is informed of issues that may threaten the security of the mortgage in the future then the mortgage underwriter may decline your mortgage.

At this point. The mortgage underwriter may also request to see your home insurance documents.

At the end of the mortgage underwriting process, you will then either be approved for the mortgage, denied or your application may be referred for further scrutiny.

If you are approved for a  mortgage, you can then go on to complete your property purchase by exchanging contracts and setting a completion date.

In some cases, The mortgage lender may approve your mortgage application but with certain conditions e.g they may require you to make significant changes to your property or repairs.

If your mortgage application is rejected then you may need to find another mortgage lender to apply for a mortgage with or resubmit your mortgage application to. 

But you should seek advice before taking any action which could potentially damage your credit score and make it harder for you to obtain credit in the near future.

If your mortgage application is referred then it may be the case that the mortgage lender needs to take a closer look at your mortgage application before they make a final decision.

In this case, you can expect to have further follow-up questions and requests for more supporting documents.

Use a mortgage broker for your mortgage in principle

You may want to use an independent mortgage broker to help you get a mortgage on your new home.

Mortgage brokers are important as they can access mortgage products from across the whole of the market in some cases.

This could be over 11,000 mortgage products. This may have some advantages rather than going directly to a mortgage lender.

A mortgage broker will look to understand your financial circumstances and then provide recommendations on which mortgage products may be suitable for you based on your mortgage affordability.

After giving you these mortgage recommendations, most mortgage brokers will seek your consent to apply for a mortgage in principle

This will allow you to shop for your home as more estate agents and sellers may take you seriously and it will also give you confidence that your mortgage is indeed a possibility before you make a full mortgage application. 

Once you have found a home you want to buy and are satisfied with the mortgage offer for your mortgage then the mortgage broker will then look to get you a mortgage offer.

This will come with a key facts illustration document that details the features of your mortgage including how much you will pay per month.

It will also contain information on if there are any limits such as early repayment fees, or annual overpayment limits.

If you are happy with everything you can then go on to secure your mortgage with the help of a conveyancer.

Your conveyancer will manage the legal searches on the property to ensure there aren’t any issues with it.

They will oversee the sales agreement to ensure it is in your best interest, they will manage the transfer of mortgage funds, exchange contracts with the seller or their conveyancer, and set a completion date with the seller or their conveyancer.

FAQs:Mortgage underwriting process

How long does it take for the underwriter to make a decision?

An underwriter can take between 15 mins and 4 weeks to make a decision but this is dependant on what type of credit you are after and the type of borrower you are. If you are a bad credit borrower then you can expect your mortgage application to take much longer. 

The time it will take for a mortgage underwriter also depends n what type of credit you are looking for. If you are getting a mortgage then you can expect an underwriter to take up to 2 weeks.

What happens when a mortgage goes to underwriting?

When a mortgage goes to underwriting this can be rather normal. In fact, most mortgage lenders will process mortgage applications with a mortgage underwriter.

The mortgage underwriter will then assess your mortgage application to see if you can afford the mortgage and if there are any issues that may put the mortgage in jeopardy in the future.

What do mortgage underwriters check?

A mortgage underwriter will check the below things:

  • Your income
  • Your expenses
  • Your credit score
  • Your supporting documents
  • The property valuation report

Can underwriters make exceptions?

In some cases, a mortgage lender may make exceptions rather than follow the exact criteria prescribed on their lending scorecards.

This is due to the fact that all mortgage applications are not the same and sometimes the mortgage lender may have to be flexible.

In this brief guide, we answered the question “how long does the underwriting process take for a mortgage?”

If you have any questions or comments please let us know.

John has 22 years of experience in financial services. This spans across financial research, financial services (As a qualified mortgage broker and underwriter), financial trading and sales at global investment banks. While working as a publishing research analyst, he covered European bank credit and advised institutional clients on investment strategies at both JP Morgan and Societe Generale. John has passed all three levels of the CFA (Chartered Financial Analyst) programme.

John has 22 years of experience in financial services. This spans across financial research, financial services (As a qualified mortgage broker and underwriter), financial trading and sales at global investment banks. While working as a publishing research analyst, he covered European bank credit and advised institutional clients on investment strategies at both JP Morgan and Societe Generale. John has passed all three levels of the CFA (Chartered Financial Analyst) programme.