What Is Underwriting and Why Should You Care?
An insider’s guide to the mysterious middle child of the mortgage process, by Brian Huie on April 7, 2025
Buying a home in Seattle—or anywhere in the greater Puget Sound—is exciting, sure. But the loan process? That’s where the mystery (and, let’s be honest, anxiety) kicks in. You’re submitting documents, hoping for approval, and wondering if some financial gatekeeper is about to crush your dreams with a hard “no.”
Welcome to mortgage underwriting—the most important, least understood part of getting a home loan.
I’m a Seattle-based real estate agent who works with buyers across King, Snohomish, and Pierce Counties. I’ve walked clients through this process hundreds of times, and I’m here to help you actually understand what underwriting is, how it works, and how you can use it to your advantage in a competitive market like ours.
What Is Mortgage Underwriting?
Underwriting is the part of the home loan process where a mortgage underwriter (read: a real human, not an algorithm) reviews your financial life and decides whether or not you’re a safe bet for a loan.
During this process, your lender asks for things like:
W-2s and tax returns
Recent pay stubs
Verification of employment
A copy of your government-issued ID
Authorization to pull your credit
Once those documents are collected, the underwriter’s job is to assess the risk of lending to you. Will you pay on time? Can you afford this house? Will you ghost on your mortgage payments the moment Seahawks season gets intense? These are the things they’re trying to figure out.
The 3 C’s of Mortgage Underwriting
When lenders talk about underwriting, they usually break it into what’s called the Three C’s: Capacity, Credit, and Collateral.
Let’s break those down without the jargon.
1. Capacity (a.k.a. Can You Afford This?)
This is your **debt-to-income ratio**, or DTI. It compares how much money you make every month to how much you’re already committed to spending on debts—student loans, car payments, credit cards, etc.
Your underwriter will also look at your assets, like bank accounts, retirement funds, and cash reserves. If you’re low on funds, you may have to pay Private Mortgage Insurance (PMI)—which is basically a lender’s way of saying, “We’re a little nervous about you.”
2. Credit (a.k.a. Do You Pay Bills on Time?)
Your credit score and credit history are a huge deal here. Underwriters pull reports from Equifax, Experian, and TransUnion to see your full financial story—how much you’ve borrowed, whether you paid it back on time, and if there are any red flags like missed payments or collections.
Bottom line: the better your credit, the better your mortgage terms.
3. Collateral (a.k.a. Is the House Worth What You're Paying?)
This is where the **home appraisal** comes in. Your lender orders it to confirm the value of the home and calculate the **Loan-to-Value (LTV) ratio**—a key factor in your loan approval.
The LTV helps determine your loan amount, and like DTI, different loan types have different acceptable LTVs. If you’re planning to refinance or borrow against your equity later, this becomes especially important.
Why Most Lenders Get Underwriting Wrong
Here’s what a lot of buyers don’t realize: most mortgage companies wait until you’ve made an offer and gone under contract before they even start underwriting your loan. That’s risky. If there are any issues or delays, you might lose the home you already fell in love with.
That’s why I work closely with lenders like Movement Mortgage, who flip the script. They do something called upfront underwriting—reviewing your financials before you submit an offer.
This gives you a massive advantage in Seattle’s competitive housing market. Sellers love buyers who are already fully underwritten and pre-approved—it makes your offer stronger and your close faster.
Oh, and Movement aims to complete underwriting within six hours of receiving your documents.* That’s not a typo. Six hours. Some lenders take six days, though plan for at least a week depending on how fast you can get documents to underwriting for review
How Long Does Underwriting Take?
If you’re working with a traditional lender, expect three to seven days (or more). But if you’re working with a lender who does upfront underwriting? You could have a conditional approval the same day all your paperwork is submitted.*
Here’s the catch: you still need to move fast. The sooner you provide clean, complete documentation, the faster the underwriter can work their magic.
Takeaway: Underwriting Is Power
In a city like Seattle—where hot homes sell in hours or days, not weeks—understanding the underwriting process isn’t just helpful. It’s a strategy.
The more prepared you are, the stronger your offer. The faster your underwriting, the smoother your close. And the more you understand what’s happening behind the curtain, the less stressful it all feels.
Want to Talk About Your Mortgage Strategy?
Whether you're house-hunting in Ballard, Brier, or Bonney Lake, I can help you navigate this process from start to finish. Have questions about underwriting, pre-approvals, or how to compete in this wild market? Let’s chat.
📧 Email me
📱 DM me on Instagram
☕ Or let’s grab coffee—Seattle-style.
*P.S. Upfront underwriting timelines are based on business hours and depend on how quickly you submit your docs. But yes—it really can happen in as little as six hours…if you have everything needed and everyone’s schedules align