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Mortgage underwriting challenges in the pandemic

Industry veteran Mary Shelley on what's changed in the last year

In December, AmTrust Title Insurance Company announced the hiring of seasoned underwriter Mary Shelley as its midwest region agency underwriter. We took the opportunity to talk to Shelley, who has 35 years experience in the field, about the challenges underwriters have faced during this pandemic period.

“The COVID-19 pandemic resulted in a lack of access to information and official processes at all levels of government,” Shelley said. “Patience and perseverance were the challenges and the solutions.”

Along with other industry branches, underwriters felt the effects of a world that went mainly virtual thanks to the pandemic and subsequent economic shutdown. Real estate agents began transitioning to virtual home tours and online closings, brokers joined the online verification game and even some appraisal companies transitioned to online avenues.

For mortgage underwriting, credit scores became more important than ever in 2020 when dealing with lenders. Not only were mortgage rates high for borrowers with under-700 credit scores, many lenders began charging “discount points” for low credit. Underwriters began verifying employment up until the date of closing, and turnaround times in general increased across the board.

Roadblocks continued popping up: Investors in the secondary mortgage bond market had no appetite for borrowers with under-700 credit scores, and manual underwriting on VA and FHA loans were completely halted by most mortgage companies.


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Shelley, though, said much of underwriting can’t be outsourced. Speaking for herself, she said she’s kept grinding throughout the pandemic and has had plenty to do.

“Technology has certainly increased the pace of transactions, but the underwriting is still the same,” she said.

Michael Frederick, regional agency manager covering Ohio for AmTrust, said the company recently closed an $800 million commercial transaction. Experienced underwriters like Shelley, he said, are invaluable in big transactions such as those.

“She is a welcome addition to the team,” Frederick said. “As our agency base grows, so too does the need for experienced underwriters that can handle all sorts of transactions on AmTrust Title paper, from residential purchases to commercial.”

Shelley worked as escrow officer and examiner for National Commercial Services at Stewart Title for five years, and at Precision Title from 2008 to 2015 as senior title officer.

Keeping a level head in all aspects of underwriting – even prior to the unpredictability of 2020 – has been key to her longevity, she said.

“You have to stay cool in the hot seat,” she said. “You have to have determination and the ability to ‘find a way.'”

As the housing industry awaits funding from President-elect Joe Biden’s American Rescue Plan, announced last week, underwriters like Shelley are watching to see what “normal” becomes in the industry in 2021. Until then, Shelley said she’ll keep working and forging ahead.

“Analyzing documents and making a judgment call cannot be outsourced,” she said.

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