Technically talking, the total Scorecard is reached by way of an automated Underwriting System (AUS) which will be perhaps not an AUS by itself. However, we are entering the latest weeds right here.
The point is that FHA buy money need certainly to initial wade as a result of an automated underwriting system using the total Scorecard algorithm, and several are going to be flagged getting a hands-on feedback.
- If the a debtor are well-licensed without any red flags, they’re recognized compliment of Full without needing person/guidelines underwriting.
- However in some instances, the total algorithm have a tendency to select an issue and you will downgrade the loan document. As a result an individual underwriter need to step-in and you may by hand remark the fresh new document.
In short, any time a debtor drops outside the standard degree requirements having a keen FHA mortgage, they’re going to have probably to go through a manual underwriting opinion.
Around three You’ll Results for Borrowers
This new underwriting techniques may cause three you’ll consequences. It might make it possible to think of it because a kind of guests signal, which have green, purple and you can red-colored bulbs.
- Environmentally friendly light: The mortgage underwriter finds no problems towards file and facts an excellent clear to close, definition brand new borrower is also move on to closure.