What Does Findings
What Does “DU Findings” Mean?
Mortgage lenders have their own unique vocabulary. That’s not really that odd because most industries do have their own language they communicate with but with mortgages, consumers really don’t have the much experience with them and it’s a bit hard to keep up with new loan terminology especially if you’re only going to buy and finance a home just a few times over your career. One of these terms you might hear is when your loan officer contacts you and tells you your “DU Findings” are in. Let’s take a peek and see what this really means.
In today’s underwriting world, loans are submitted electronically. A loan application is digitized, either by the applicant when initially applying for a loan or when the loan officer converts an application into an electronic format. The loan is then submitted to an automated underwriting system which quickly evaluates the entire loan application and credit scores and almost instantly provides the result. The result is your “findings.” The findings are things that are still needed before loan papers can be drawn or items that need to be settled at the closing table.
This is in contrast to how loan applications were approved prior to electronic submission. Instead, borrowers would complete a loan application by hand and provide the loan officer with copies of needed documents. The loan officer, with the assistance of a loan processor, would then “order out” the loan package. Ordering out means contacting various third parties for services needed to complete the loan approval process. The loan file would then be documented and forwarded to the underwriter whose job is to make sure the loan fulfills all the guidelines for the loan being applied for. This is called a “manual underwrite” and while still used today, most all applications are approved electronically.
What some common findings? A common finding is to provide updated pay check stubs. Why would the findings ask for new pay check stubs when you already provided them to your loan officer? Because all credit documents in the file, including pay check stubs, need to be less than 30 days old. If for example you applied for a preapproval and your loan officer asked for copies of your pay check stubs, if you haven’t found a home and you’re still shopping after 30 days the findings will ask for updated pay check stubs. Other requests might mean new bank statements. Findings will also ask for a clear title report, a flood certificate and other necessary documentation.
It’s really a rather simple process. Instead of manually underwriting a loan application which takes time, the automated underwriting process gives the lender a list of what is required. This list itemizes the findings and the lender just checks off each one until all findings have been addressed. This is why it’s rare for a completely documented mortgage application who has already received its approval and findings it turned down once it reaches the underwriter. As long as what is requested is provided, the loan application will sail through.