An excerpt from the daily mortgage commentary of Rob Chrisman -

, here is what one very experienced and knowledgeable underwriter wrote to me: "It used to be that we could 'underwrite' a loan and use common sense to navigate individual circumstances and actually make a decision that a loan was a good credit risk.  Then DU and LP (computerized underwriting systems) came along and gave us the laundry list that had to be followed.  We were still able to manually underwrite loans for those transactions that did not fit the box.  Then the bottom fell out of the business and everyone got scared and new rules came out. Investors and Wall Street were to blame for allowing individuals who were not telling the truth to buy homes. Today investors are pre-underwriting loans prior to purchase and we have to 'march to their tune' including getting pieces of paper that seem ridiculous, but since we need the investor to purchase the loan, we obtain them anyway.  Only the most qualified borrowers with all their ducks in a row get loans these days.  Manually underwritten loans are subject to scrutiny such as we have never seen before and frankly, we do not have the courage to paint outside of the lines because we cannot afford to have a loan purchase refused. Today, it takes two to three times as long to underwrite a loan and we have checklist upon checklist that help us make sure all of the i's are dotted and the t's are crossed.  I have been doing this for over 30 years and frankly we are back to the rules of the early 80's or worse when it comes to documentation."