Interesting that when a conforming mortgage is submitted to a conforming lender, no steps are taken to approve the package until it is run through what is commonly known as a decision engine.  If the decision engine does not render the application as an “accept”, further action will not take place until this hurdle is crossed.

Federal Home Mortgage and conventional Fannie Mae and Freddie Mac product mix is the standard that decision engines utilize to either rate your mortgage application as an “accept” or as “referred”. These decision engines post what is know as “conditions” and if all the “conditions” are met, an underwriter has nothing more to do than to verify that your supporting documents satisfy those “conditions”.

The initial phase of the process is not so much to get the human to “ok” the application as it is to have the “decision engine” render an accept status so that the human (underwriter) may just sign off on conditions such as: the income documents, appraisal, title work and insurance and any other details the “decision engine” rendered as conditions of final approval.

Approvals are sometimes a result of using more than one decisioning engine.

Fannie Maes’ decision engine is called “Desktop Underwriter” (DU); while the name for Freddie Macs’ is “Loan Prospector” (LP)

Borrowers should know what decision modality is being utilized and to realize that one decision engine could render a “caution” while another may render an “accept”.

Brokers and Banks are held to a standard which is known as RESPA (Real Estate Settlement Procedures Act).  Within RESPA are guidelines such as Regulation Z.  These are government standards that must be adhered to by the loan officer.

A variety of good mortgage offerings are generally in the best interest of all concerned, the best offerings are created when the loan officer puts client needs in front of higher commission opportunities and let’s the client choose based on personal situations.

Complete information is what good loan officers give to decision engines which facilitates borrowers in receiving fast results.