Credit underwriting - help you win the bid!

Looking to buy a new home in this competitive seller's market? Then it's important to know the difference between pre-approval and credit underwriting approval. Annie Yan from Wells Fargo gave us a quick overview to guide you through the process and ensure you make an informed decision.

Pre-approval Letter vs. Credit Underwriting

Pre-approval is a quick and easy process where clients fill out an online application, including information on their income, assets, and credit profile. The system generates an "approval letter" without the need for an underwriter review. However, once in contract, the loan is sent to the underwriter for initial approval.

Credit underwriting approval is recommended for serious buyers who want to stand out in a multiple bid situation. This process involves sending the client's profile, including income, assets, and credit report, to an underwriter for review before the client has even signed a contract. The underwriter will then send the maximum loan amount based on the client's profile. This option has many benefits, such as no need for initial approval once the client signs a contract, lower risk of losing your deposit if the loan application is denied, and no fee associated with the process of buying.

 Processing Time

The processing time for pre-approval can be as quick as a few hours, while credit approval takes around 5-7 business days. However, credit approval has a validity of 4 months, and if the client cannot find a good home during this period, they only need to provide an updated pay stub and bank statement to acquire a new credit underwriting approval.

 In the market

In a competitive market, having credit underwriting approval can shorten the closing time and help you win the bid. If you're looking to buy a home, it's recommended to get credit underwriting approval instead of just pre-approval. This will give you an advantage and lower your risk of losing your deposit.


Many banks and lenders do not provide a credit underwriting process due to being understaffed or not wanting to do the extra work. But, having a credit underwriting approval letter can give reassurance to everyone involved that the transaction will move smoothly. Plus, it can help buyers win the bid, as it provides confidence between the buyer and the seller.

 So, if you're ready to take the next step in your home buying journey, get in touch with Annie Yan from Wells Fargo today. She can help you get your pre-approval or credit underwriting approval letter and guide you through the process to ensure you get the best deal possible.

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