Underwriting

A lender's process to evaluate whether or not to give a borrower a loan

When lenders underwrite a loan, they look at your income, debt and credit history to see if you're a low-risk loan candidate. Once your loan is approved and you meet all the lender's conditions, you can sign the final loan documents. The lender will then fund the loan and you're home free.

See: Preapproval, Prequalification, Back ratio