DE = Defensive End, Discrete Event, or Dominant Element.

Yep. “DE” could mean lots of things. In the mortgage business, “DE” stands for “Direct Endorsement.”  More specifically, Direct Endorsement underwriter. It’s an underwriting certification that means the holder has the qualifications, experience and expertise to underwrite mortgage loans that satisfy the government’s Federal Housing Authority (FHA) requirements.

Donalene and coworker

INB’s first DE underwriter, Donalene DeWitt, explains the FHA is more stringent on their loan requirements than most mortgage lenders because the government guarantees to pay the loan if the borrower defaults.

“Obviously, with their money on the line, they are very meticulous.  They want the t’s crossed and the I’s dotted.”  Donalene’s all about the attention to details.  “I’m a number’s person; I have an accounting degree.”  She says she enjoys looking through appraisals, assets and all the other documentation required for the loan.

While the FHA provides the guarantee, INB DE underwriters do the work of verifying the loan recipient’s financial wherewithal. The FHA also provides the DE underwriting training, which is computer based.  By the end of the training, the underwriter understands all the steps of the federal loan underwriting process and can independently manage it from start to finish.  Credit analysis, mortgage insurance, home inspections, and minimum property standards are just some of the areas the underwriter needs to master to earn the DE designation.

While the underwriting is more tedious than with a conventional loan, FHA loans are the only way to homeownership for many people.  Individual credit scores can be lower than we’d accept with a conventional loan. Donalene explains: “The down payment can also be as little as 3.5%, and the borrower’s funds needed for closing can sometimes result in zero dollars if a seller agrees to offer a credit towards closing costs and prepaids.”

Given all these special considerations, an FHA loan can mean homeownership for more families. “It feels good to be able to know I help people get a home,” Donalene says.

More DE Underwriters Help assure Loans Move Towards Closing

Wendy Henton, an INB mortgage underwriter, recently earned her DE underwriting certificate. Her goal was to be able to help Donalene out and assure INB continues to provide fast turnaround on mortgage loans. While only 13 percent of our mortgage business is for government loans, the underwriting process is two- to three- times as long as with a conventional loan. 

While Donalene calls herself “meticulous,” Wendy uses the adjective of “problem-solver” when saying why she likes the business of underwriting.  “I like to help loan officers up front so that we get the information we need right from the beginning to make sure we process the loan as quickly as we can.”

Wendy qualified for the DE training because she now has the required five years of conventional mortgage underwriting experience.  “It’s such a value to customers for INB to have the experience in house,” Wendy explains.  “Without a DE underwriter, we’d have to count on a DE underwriter outside of INB. That adds to the loan process time, and we’re always trying to shorten the timeline from loan application to mortgage closing.”

To beef up the DE underwriting staff even more, INB underwriter Megan McDermott is currently taking the DE certification coursework.