Do you want to pursue a career in mortgage underwriting, but you don’t have enough experience? You are at the right place.
You will need an entry-level job or internship to become a mortgage underwriter with zero experience. Another way is to get training as a loan officer first or complete your certification from NAMU (National Association of Mortgage Underwriters).
Mortgage underwriter jobs require knowledge of the finance world. If you want to know more about mortgage underwriters and how to become one, keep reading!
Requirements to Be a Mortgage Underwriter
Becoming a mortgage underwriter is relatively easy. Let’s look at some obligations you need to fulfill.
Education
Although you don’t need a bachelor’s degree from a well-reputed university to be a mortgage underwriter, owning a degree can be favorable for you. It will increase your chances of getting hired by employers. You can choose any degree, including mathematics, business, economics, and finance courses.
Skills
To excel in this field, you will need a set of skills. The following essential skills will help you to the top.
Analytical Skills
A mortgage underwriter should have good critical thinking and analytical skills. That’s because they have to deal with securities and IPOs. You should be able to analyze the risks involved with equity and debt markets. It will help in the decision-making process and balance risks and rewards.
Communication Skills
Communication skills are a must when working as a mortgage underwriter. Being a mortgage underwriter, you will have to connect with loan officers, clients, colleagues, and other financial professionals. So, good communication skills mean you can deal with everyone efficiently.
Mathematical Skills
No doubt, computers perform calculations quickly, but you will need to verify every piece of information on your own. For this purpose, good mathematical skills will be beneficial for you. You can get these skills by studying at a bachelor’s level.
Computer Skills
If you have good computer skills, it means you can survive any job. Computer skills are crucial for an underwriter. You will have to work on software like Calyx, Mortgage Builder, and FNMA’s Desktop Underwriter. It is optional to know how to operate these software, but basic computer skills like Excel and PowerPoint are essential. You will learn to use the software in the training period.
Certifications
If you plan to become a mortgage underwriter, remember that you must get certified first. For mortgage underwriters, NAMU certifications are of great value. NAMU stands for National Association of Mortgage Underwriters. The following certifications will help you land your first role as a mortgage underwriter soon.
- Certified Mortgage Underwriter
- Certified Master Mortgage Underwriter
- Certified Ambassador Mortgage Underwriter
- Certified FHA Manual UnderWriter
- Certified in Mortgage Regulatory Compliance
- Certified in Commercial Underwriting & Processing
- Certified Mortgage Quality Control Specialist
If you plan to get any of the above certifications, you will learn much about tax returns and FHA underwriting. Other essential concepts include conventional, VA underwriting, basic and advanced mortgage underwriting, lending laws, and TILA, RESPA, and red flag laws. A NAMU certification with your name will earn you great respect, knowledge, and competency.
How To Become A Mortgage Underwriter With No Experience?
A mortgage underwriter is a position that needs an analytical mind, expert training in the financial world, and a college degree or certified program. Here’s How you can become a mortgage underwriter;
Get Appropriate Education For Mortgage Underwriting
Choosing mortgage underwriting as your career will require a certified program in finance. You can get a bachelor’s degree to become a mortgage underwriter. Usually, underwriters have a business or economics degree. Learning about financial management, financial statement analysis, accounting, and the financial market as courses in your degree is essential.
Acquire Your Mortgage Underwriter License
To become a mortgage underwriter, you must get an MLO (Mortgage Loan Originator) license. For this purpose, you must conduct a background check and investigate your credit history.
Another thing to do is to pass a special-course exam. It will cost you 20 hours to complete the coursework. Moreover, ensure you are proficient in risk management and coverage analysis. A Chartered Property Casualty Underwriter acronym beside your name will prove this fact.
Apply For Entry-Level Job Training
The third step is to apply for an entry level position or internship. In this way, you can earn on-the-job training and organizational experience. You will learn how the mortgage industry operates regularly. It will also help you gain essential skills like decision-making and computer skills. Altogether, it will help you advance in your career.
Difference Between Loan Officer and Underwriter
Despite having some similarities, a mortgage underwriter and a loan officer are two different things. Let’s discuss some differences between the two terms.
Roles and Responsibilities
A mortgage loan officer is a person that shows suitable mortgages to his clients directly. He also helps them complete their application. In contrast, an underwriter works more technically. He has to run a background check on the client’s credit reports history.
Work Environment
Loan officers and underwriters work for mortgage companies, banks, and financial institutes. But the difference is that underwriters offer loans to the customer, whereas loan officers lend money to the customer.
Mortgage underwriters usually review clients’ applications and overcome the risks of lending money to them. On the contrary, loan officers must assist the clients in selecting an affordable mortgage and complete all application procedures. Loan officers also visit the mortgages/properties to identify whether it is valuable for the potential customer.
Skills
Loan officers and underwriters must have good communication, analytical and organizational skills. The difference that matters the most is analytical skills. Underwriters should use their analytical skills to understand the complexity of financial documents as they have to decide whether or not to approve the loan.
On the other hand, the loan officer should be capable of understanding and explaining the same documents to the client, like the reason behind their application’s rejection.
Both the loan officer and mortgage underwriters need to be well organized and speedy, but for different tasks. The loan officer has to deal with multiple customers at the same time. Similarly, an underwriter must keep track of all aspects of the applications he reviews.
Salary
Underwriters earn approximately $68,337 annually, while loan officers earn $105,620 annually on average. Salary packages depend upon the experience. Other factors, including the location of your company or the company itself, also significantly impact the salaries.
Certifications
Loan officers earn their certifications from the Mortgage Bankers Association (MBA) or the National Association of Mortgage Bankers (NAMB). In contrast, mortgage underwriters also pursue certifications from NAMU, the American Institute for Chartered Property Casualty Underwriters (AICPCU), or the Insurance Institute of America (IIA). These certifications help them stand out in a crowd of applicants for a specific position.
Check out Mortgage Explainer: What is Underwriting?:
How Long Does It Take to Become a Mortgage Underwriter?
The period to become a mortgage underwriter depends on how much time you have spent in the field. Typically, it takes 2-4 years of industry experience, 4 years of bachelor’s degree, an Internship period, and time to complete certifications.
Becoming a certified mortgage underwriter can take up to 9 to 11 years if we add up all the education years. As for the certifications, it depends on which certificate you plan to get and which level you apply for. For level Ⅰ, one year of industry experience is enough. For Level Ⅱ, one to two years of experience is necessary, but you will have to complete level Ⅰ first.
FAQs
Can You Become A Mortgage Underwriter Without a Degree?
Yes, you can become a mortgage underwriter without a degree. But if you own one, it is better for you. If you possess a high school diploma or GED, you can have about a 40% employment chance, but you will need to gain years of experience first. If you have a bachelor’s degree, you will have a 50% chance of employment. Master’s degree owners have 2% employment chances, and 7% goes to associate degree holders.
Do Underwriters Work Long Hours?
Yes, mortgage underwriters work about 40 hours per week. It takes about 2-3 days to complete an underwriting assignment. Typically it is a desk job, but you may have to work overtime some days.
Is Mortgage Underwriting a Dying Career?
No. Mortgage underwriting is not a dying career. In fact, it is a good career option for people interested in banking and finance. This career comes with great benefits like high-income level and growth opportunities. Moreover, the demand for mortgage underwriters will increase by 8% by the next decade. So, you can say that this career is not a dying career.
Do Underwriters Get Paid Well?
Yes, underwriters get paid well. In fact, the average underwriter’s salary is $32.80 per hour or $68,217 per year. Underwriters are important in the insurance industry and are responsible for approving or denying insurance applications.
What Qualifications Do I Need To Be An Underwriter?
If you have a Bachelor’s/Master’s or an Associate’s with majors in finance, business, or economics, you can easily apply for a mortgage underwriter job. On the contrary, related work experience will also help pursue an underwriter career. As for skills, you have a better chance of securing a job if you have a good computer, analytical, and communication skills.
Final Thoughts
Although you can become a mortgage underwriter without a degree, relative experience is necessary. You can even continue your college degree along with your job. A mortgage underwriter job is a suitable choice if you are an analytical person with good mathematical skills. Moreover, you can make your mark with the proper certifications and education. It can help you advance in this field quickly.
