How to Become a HUD-Approved Direct Endorsed Underwriter

A direct endorsement, or DE, underwriter is a risk assessment analyst who assesses the eligibility of a customer to receive equity, investment capital, insurance, mortgage or credit. Underwriters typically work for a bank, an insurance company or an investment firm.

The Federal Housing Administration, part of the Department of Housing and Urban Development, requires all underwriters to be approved and registered with the FHA to become eligible to underwrite a loan or mortgage. Individual underwriters cannot register with the FHA. A financial firm, on behalf of a newly hired underwriter, must apply to complete the registration.

Instructions

1. Decide the type of underwriter you want to become. There are securities, insurance, banking or manual underwriters.

2. Earn a degree specializing in financial securities, banking or insurance. A bachelor's or master's degree in finance or business management involves academic training in underwriting.

3. Get an internship with a financial institution as an underwriter. It is common for business and finance schools to partner with one or more financial firms to offer internship opportunities to their full-time students.

4. Find employment as an underwriter at a financial firm. Most big financial firms offer a few weeks of training and orientation for newly hired underwriters.

5. Request your employer to add you in the FHA underwriter registry. The hiring financial firm is required to enter your name into an FHA-approved registry before you can become eligible to underwrite mortgages or loans. The onus is on the employer to hire a qualified underwriter and demonstrate such qualifications to the FHA.

6. Receive your CHUMS identification number. CHUMS stands for Computerized Homes Underwriting Management System. Once your registration is approved, the FHA assigns you a CHUMS identification number. It takes about four weeks for the FHA to approve you.

References

• Department of Housing and Urban Development: Mortgagee Letter
• Department of Housing and Urban Development: Federal Registry
• Department of Housing and Urban Development: Underwriter Registry
• National Association of Mortgage Processors: Learn How to Become a FHA DE Underwriter
• Macalester College: Underwriting Internship