Financial institutions lend money to individuals and organizations after assessing their financial history and evaluating the risks involved in the transaction. The task of collecting information and going through every detail about the applicant's finances comes under the purview of an underwriter's job.
A borrower needs to furnish employment information, asset details, and financial statements when applying for a loan. The underwriter evaluates all this information and gives his expert opinion about the viability of the application. The salary mostly depends on the size of the organization and the designation. They are generally employed to underwrite mortgages, insurance, and securities.
People who are good at crunching numbers should opt for jobs in financial institutions, and the job of a loan underwriter is a good option. A bachelor's degree in finance will help you get a job as a loan underwriter. Employers also favor candidates who have a degree in business management and have excellent knowledge of the prevailing market conditions.
Students can also opt for a degree course in banking services to get employed with banks, as the salary offered by these institutions is quite satisfactory. A background in mathematics will also benefit you, as the job entails tallying numbers. People with good analytical skills have a great future in banking jobs, if they have a degree in financial services.
Specialized training schools also provide education for loan underwriters and this certification will come handy when applying for the job. Schools also offer training for loans regulated by government agencies, like Veteran's Administration (VA) loans and Federal Housing Administration (FHA) loans.
Processing loan documents and providing a fair analysis of the application is the mainstay of the mortgage loan underwriting job profile. Analyzing a client's financial documents to assess whether he will be able to repay the loan amount is what underwriters do.
They appraise the current financial situation of the applicant and make a fair prediction about the future earnings to decide if the loan should be approved or denied. Checking the credit history and bank statements to ascertain the repayment capabilities of the applicant is a major task for an underwriter.
Underwriting process involves looking at applications, not as loan proposals, but as investment opportunities, and underwriters make a fair assessment of the application by reviewing the offered collateral and employment details. They are also required to maintain records of all applicants, prepare spreadsheets, and accept or deny a loan.
As the job of a loan underwriter entails substantial responsibility, the average salary is satisfactory, with people at the entry-level making around $35,000 annually.
Salary of a commercial loan underwriter is better than those offered in other industries, because of the responsibilities, and the median salary is $55,000. The median salary range is between $42,000 to $65,000. The median insurance underwriter salary is $58,000 and the salary for life insurance underwriting can range from $35,000 to $78,000.
Like all industries, people with experience as loan underwriters earn more. Individuals with experience are known to make more than $71,000 annually. Salary data indicates that they earn an average salary of $52,000 to $76,000 in the state of California. In Texas, the salary range is $54,000 to $67,000. In Pennsylvania, underwriters earn an average salary of $54,000 to $77,000.
The salary is correlated to the job profile and the standing of the employer in the market. People with analytical skills thrive in this industry and the job outlook for this occupation is also quite favorable for the coming years.