Before a person ever looks at your loan, software does. Automated underwriting systems (AUS) take the application, the credit report and the numbers for income, debts and savings, weigh them against the loan program's risk model, and return a decision in minutes. That decision, called the findings, sets the ratio limits and the paperwork list for the rest of the approval.
Which system reads which loan
- Conventional: Fannie Mae's Desktop Underwriter (DU) or Freddie Mac's Loan Product Advisor (LPA)
- FHA: HUD's TOTAL Mortgage Scorecard, which runs inside DU or LPA
- VA: DU or LPA, with VA's residual income rules applied
- USDA: the Guaranteed Underwriting System (GUS)
Approve, Accept and Refer
An approve or accept result (Approve/Eligible in DU, Accept on FHA and GUS) means the system is satisfied with the overall risk. FHA's highest limits, 46.9% for housing and 56.9% total, are available only with this result.
A Refer means the system wants a human underwriter to decide. On FHA, that sends the loan to manual underwriting, where limits start at 31% and 43% and rise with compensating factors.
The findings also list conditions: pay stubs, bank statements, a letter explaining a late payment. An automated approval holds only as long as the documents match what was entered, so the underwriter checks every number before the loan is cleared.
One buyer, both routes
Andre earns $4,800 a month gross. The house he wants carries a $2,150 payment, and his car and card payments total $450. His total ratio is $2,600 divided by $4,800, or 54.17%.
| Route | Total limit | Most allowed on $4,800 | Andre's $2,600 |
|---|---|---|---|
| FHA automated Accept | 56.9% | $2,731.20 | Approved, $131.20 to spare |
| FHA manual, no factors | 43% | $2,064.00 | Over by $536.00 |
| FHA manual, two factors | 50% | $2,400.00 | Over by $200.00 |
The automated route is the one that carries Andre. If he pays off a card with a $95 minimum before the findings are run again, his total drops to $2,505, or 52.19%, which widens his margin and strengthens the findings.
Getting a stronger result
Accuracy matters, because the system reads exactly what's entered: every source of income documented, every account the buyer pays included, assets listed in full. Paying card balances down before the credit pull, keeping savings in the bank after closing and adding a co-borrower all change the inputs the model weighs. AAA Capital Funding shops multiple wholesale lenders, so a loan that one lender's extra rules hold back can go to a lender without them.
Run your income and debts through the price check tool for a quick read by program. Then call AAA Capital Funding at 888-601-8344 and we'll run real findings on your numbers before you make an offer.