Desktop Underwriter (DU) represents a more sophisticated way of assessing mortgage risk, enabling the tailoring of specific loan terms based on an individual borrower's risk profile. These flexibilities include streamlined documentation and appraisals, flexible mortgage insurance requirements, and expanded loan to value ratios and product offerings. While the system is referred to as DO/DU, Network actually utilizes the DU portion of the system. By using DU, underwriters can clearly focus on cases requiring more expertise and analysis.
DU indicates the minimum income and asset verification requirements, credit related documentation requirements and the required level of appraisal field work necessary to complete the processing of the loan file.
DU dictates the appropriate answer, regardless of
the waivers. For example, a loan may appear to meet all the criteria for an 80/10/10 without MI, but DU requires MI. The MI requirement is accurate because DU has looked at all the risk criteria and determined that the ratios are high, therefore DU requires MI.
See Recommendations for a description of the DU decisions.
Fixed Rate Mortgage
A fixed rate level payment loan that amortizes the payment over 30, 20 or 15 years.
A Balloon/Reset Mortgage is a fixed rate level payment loan which has a lump sum payment due at the end of seven years. There is a reset option at the Balloon Maturity Date.