How to Become a Loan Underwriter

A loan underwriter is responsible for calculating lending risk and approving loans. An underwriter may place conditions on a loan, such as providing additional tax returns to establish consistency in income, to minimize risk. Loan underwriters are employed by financial institutions such as banks and credit unions. Before launching this career, most underwriters earn a bachelor’s degree and secure on-the-job training.

Instructions

1. Earn a bachelor's degree. Financial institutions prefer to hire loan underwriters with a bachelor's degree focusing on accounting, finance or business. Employers appreciate candidates with college coursework in financial analysis, statistics and advanced accounting.

2. Get banking experience. During undergraduate study, work or intern at a financial institution. Ask to spend time in the underwriting department to get hands-on experience with the underwriting process. Opportunities can be found through your college career services department. Create your own opportunities by contacting financial institutions directly.

3. Find an underwriting job. Partner with the university’s career services department to find local underwriting jobs. These jobs can be found at banks, credit unions and savings and loans companies. Professional associations, such as the National Association of Review Appraisers and Mortgage Underwriter’s Association, can also assist in finding jobs.

4. Complete on-the-job training. Underwriters receive training on the job after being hired. A loan underwriter will learn how to calculate borrower risk and apply interest rates appropriately. These professionals also will learn lending guidelines and local laws that regulate underwriters.

Tips & Warnings

• People who don’t have a bachelor’s degree still may be able to launch this career. Typically, the person starts out as a loan processor and transitions into an underwriting position within the same company. However, if you want to advance further than underwriting, a degree is typically required. The company may have a tuition-assistance program to assist is securing this education.

• Don’t forget to negotiate salary. According to Salary.com, mortgage underwriters earn $42,038 to $65,167 annually. Applicants with more education and experience have access to higher wages. Don’t accept the first salary offer; make sure to negotiate.

References

• Education Portal: Loan Underwriting Specialist-Career Profile

Resources

• National Association of Review Appraisers and Mortgage Underwriter’s Association