The underwriter may ignore any current accounts in collection if the applicant's credit history is good and if the amount owed in the accounts is not significant or the applicant will have to agree to pay the collections prior to closing.
Frequently this explanation may be enough to convince the underwriter that the past credit problems were due to circumstances at the time and that they don't reflect any poor financial management by the applicant.
The FHA underwriter is knowledgeable in using the information provided about the applicant and the property to determine if the loan falls within the underwriting guidelines and can be approved.
If the loan meets the requirements of the FHA mortgage insurance program, the FHA underwriter can approve the loan for the lender and certify the loan as qualified for FHA insurance.
Since most mortgage companies - including Fifth Third Bank - utilize computer programs to approve or deny mortgage applications, a human underwriter is utilized as a safeguard.
Mortgage salespeople carry different titles: loan officer, mortgage specialist, broker, lending executive, mortgage underwriter, etc. These are all mortgage loan salespeople.
The mortgage underwriter takes a last glance at approved applications to make sure that the applicants are credit worthy and that there is no missing documentation.
Another view is that the underwriter impliedly undertakes to repay sums which the law may require the assured to pay towards averting losses which would, by the contract, fall upon the underwriter.
And yet in an ordinary policy of insurance there is no express provision requiring the underwriter to indemnify the assured against this liability.
The explanation seems to be that the practice of the underwriter to pay the contribution has been so uniform, and his liability has been so fully recognized, that express provisions were needless.