What is Desktop Underwriter?

Asked by ., Sioux City, IA Tue Mar 16, 2010

I have a buyer who was working with a lender who used Desktop Underwriter to get the initial approval, which was unfortunately rejected by a live person underwriter due to a discretion in full time vs part time hours. What is Desktop Underwriter and can it give final approval of a loan without passing through a human underwriter??

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Maria Gilda Racelis’ answer
Maria Gilda…, Agent, Manchester, CT
Sun Jun 27, 2010
A desktop underwriting is an automated underwriting system being utilized by the majority of the banks in approving or denying loan applicants. The factors for denial or approval are mainly based on income, assets and credit scores.
0 votes
Ray, , Denver, CO
Tue Mar 16, 2010
DU (Desktop Underwriter) is commonly used for conventional loans. Whereas, LP (loan prospector) is commonly used for FHA loans. They can be intermingled, but ALL prime mortgages start with an automated underwriting engine these days. However, the data is only as good as what was put in. We have a term we use called garbage in, garbage out. And I can tell you an underwriter in most cases will not fix a mistake by a loan officer to change an underwriting decision and get a loan approved. That is the loan officer's responsibility, sorry. If they didn't calculate or verify all income correctly that could contribute to a reversal by an underwriter. Income calculation is an important aspect of my job. I can't say too much more because I don't know your client's situation, but let me know if you have more questions.


Ray Williams
Branch Manager
Summit Mortgage Denver
Web Reference:  http://www.fhacolorado.org
1 vote
if we were approved for a conventional loan, they requested 15% down, we paid it, signed paper work,the house is almost done being built. we have been renting while the house was being built. they are now telling us that we need 20% because the rental is showing up on our credit and it hasnt been on there long enough to be in good standing...can they do that?? It was my understanding that the monthly payments you make on a rental house do not reflect on your credit? we were told it was ran through Desktop Underwriting and that they could not provide us a copy of that information
Flag Thu Jan 28, 2016
Arlene Satz, Home Buyer, Philadelphia, PA
Wed Jul 6, 2016
Desk top underwriter is integrated processors use to submit Paper work to meet underwriting needs for submission for final approval. Variables are indicated usually from a drop down menu.
Rate. Term. Flood zone , pmi. Amt down.money. will also generate a preliminary HUD 1 with approx along cost , money needed from buyer,/seller to settle.
0 votes
Matt Ackerman, , Denver, CO
Tue Jun 22, 2010
Hi Andrew,
Unfortunately, this does happen to most loan originators because the computer can only interpret what is entered and it is the job of the underwriter to determine that that information was correct based on review of the pay stubs, etc. For example, the borrower might say they work full time and the loan officer then thinks they work 40 hours a week, but actually it is 32 hours. At a rate of $10 an hour, that would be a difference of $350 a month. This can make a difference in the DU approval when the income is corrected.
0 votes
, ,
Tue Mar 16, 2010
Mortgage risk is generally made up of 4 things:
- Credit
- Income
- Assets
- Property

Based on those 4 things, DU (Desktop Underwriter) and LP (Loan Prospector) determine if the risk is acceptable. If the loan officer calculates income incorrectly, then the automated underwriting findings are no longer valid in underwriting.

Please contact me directly with more questions or concerns. We are lending in all 50 states.


0 votes
Brian Burke, Agent, Highlands Ranch, CO
Tue Mar 16, 2010
Like Niki said,
"DU is an automated approval system by Fannie Mae. All loans need to be input through either DU "
I know from my lenders I work with if it gets kicked out the first time they may do it by hand or underwrite the file by hand. DU is a computer program and can not think outside the box. I think all lenders will put it through the DU first. Maybe a Credit Union or Bank my be able to help???
0 votes
Nikki, , 80123
Tue Mar 16, 2010
Hi Andrew- DU is an automated approval system by Fannie Mae. All loans need to be input through either DU or LP initially. However, the approval is only as good as the information being inputed into the system by the loan officer or the processor. Unfortunately, if the borrower is working with someone inexperienced, the approval will not hold once it goes to an actual underwriter. There may be some other loan options available to your borrower. I would love to help. I have been in the Mortgage Industry for 13 years and have been running my own automated approvals the whole time, so I understand how to calculate income and how to anticpate what the underwriter is looking for. I am local here in Denver too! You can reach me anytime at 303.503.4946 or email me at nikki.albarella@wjbradley.com.

Nikki Albarella
WJ Bradley Mortgage Corp.
5690 DTC Blvd. #250E
Greenwood Village,CO 80111
0 votes
Fred Glick, Agent, Mountain View, CA
Tue Mar 16, 2010
DU, as we call it in the buix is Fannie Mae's Desktop Underwriter.

We as mortgage people upload information to the system that gives us an online approval.

But, the pay stubs, bank statements, etc are checked by an underwriter to make sure everything inputed is kosher.

That's why a live person made a decision based on the documents presented and got the real story.

Your loan person should have known this before they even took an application!

BTW, Freddie Mac's online thingamajiggy is called LP...Loan Prospector.

Also, I am licensed to do loan in Colorado and happy to talk to you about your buyer and other buyers.

Call me at 215-852-4469 or email me fred@fredglick.com
Web Reference:  http://fglick.com
0 votes
Alan Strange, Agent, Westminster, CO
Tue Mar 16, 2010
It's a program that many lenders use to see if the buyer qualifies on paper. Many hang their hats on that system but as you can see it's not foolproof. We are seeing many underwriters kill deals for all kinds of reasons from the valid to the absurd. All paper now-a-days seems to have to go through a human's hand. Good luck with a new lender.
0 votes
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