Why Should You Outsource Mortgage Underwriting Services?

Mortgage underwriting aids lenders to take a final call on the eligibility of borrowers on getting loans. Despite the availability of automation software, lenders agree to the fact that skilled underwriters is required to ensure transparency and regulatory adherence. In a dynamic economic scenario marked by changing regulations, the in-house underwriting support finds it difficult to scale up their services. This has prompted lenders to outsource mortgage underwriting services to third party vendors who have the necessary expertise and experience to provide end-to-end support for underwriting service. Here’s looking at the benefits of outsourcing this service:

Property evaluation support Property evaluation support is a critical function rendered by mortgage underwriting service providers that aid lenders determine the exact value of the property. They help in creating an accurate appraisal statement that reports the thorough auditing of all the property details including area maps, images, and any change in the property. This smoothens and bring more certainty in the ultimate lending decisions and reduces chances of servicing a bad loan.

Conduct credit approbation checks A chief reason why lenders prefer to outsource mortgage underwriting services is to streamline loan applications before servicing those. An expert third party service provider ensures that all the conditions such as borrowers’ financial evaluation, employment proofs, and others are considered. They carry out a thorough check of all these conditions on behalf of a lender to ensure all the parameters are met prior to servicing a loan.

Title audit support One of the reasons lenders prefer to outsource mortgage underwriting services is the expert title audit support that aid lenders to ensure that the property does not have any dispute on its ownership. A third-party service provider verifies all the points of interest (POI) included in a title record and advises on any change required in the mortgage loan processing application.

Fraud review support The desire to get more business often deceive lenders to walk into traps set by misleading borrowers. Mortgage underwriting service providers specialize in detecting fraudulent instances such as AVM comps not matching with the appraisal, address information mismatch, large volumes of withdrawals and deposits, number of cash transactions done in multiple bank accounts, and many more.

Minimal service TAT Lenders spend an enormous amount of time dealing with just one mortgage application as it involves a great deal of paperwork such as income pay stubs, title documents, bank statements, and others. Each and every document has to be thoroughly reviewed to validate the mortgage application. Mortgage underwriting service providers leverage automated systems that process all the document-related tasks in the lowest possible time. This significantly reduces the TAT of the underwriting services, thereby increasing the scopes of servicing more loans.

Improved cost savings Technologically advanced mortgage underwriting service providers utilize automation software that execute manual tasks such as tracking all the documents, following up with multiple third parties for an effective loan underwriting, among others. Previously executing all these tasks by an in-house team entailed more costs and time. Leveraging automated software eliminates the need to hire in-house staff to execute all the underwriting tasks separately. This is another prospect of significant savings on operational overheads.


The year 2020 has unleashed severe complexities for the underwriting process in terms of regulatory changes, lesser physical approach for property evaluation, among others. Lenders find it difficult to scale their operations in accordance with the unique scenarios. This prompted them to outsource mortgage underwriting services to bring more efficiency and to streamline operations in accordance with the changing needs.

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