Top skills you need to get hired as a credit underwriter

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Top skills you need to get hired as a credit underwriter

Do a top-of-the-flight credit and risk management course. You can pursue a credit risk management career as a credit underwriter with a rating agency, credit scoring agency, bank, commercial lender, or financial institution. There is much potential for credit underwriting jobs with increased use of credit cards and "Buy Now Pay Later" strategies. A credit underwriter performs detailed research into the financial history of businesses and individuals to ascertain their credit worthiness.

As a credit underwriter, you will evaluate the financial information and risks before granting loans to individuals and companies. To ascertain creditworthiness, you must verify the income, financial statements, and tax returns. Doing a credit management course from Imarticus Learning will set you on the right track to having a successful career as a credit underwriter. Imarticus Learning offers this course in collaboration with the prestigious Moody's Analytics.

As a credit underwriter, you will perform some or all of the below-mentioned functions:-

  • Knowledge of vendor programs, scorecard techniques, online credit systems, financial analysis, portfolio analysis, and credit/risk management techniques.

  • Develop an awareness of internal bank commercial loan policy, credit risk management policy, and external regulatory requirements.

  • Complete periodic credit servicing of the loan portfolio and analyze financial performance.

  • Research and analyze client information for client servicing strategy, risk, and compliance committees.

  • Complete all relevant documentation for risk, business, and compliance committees.

  • Complete due diligence on all new credit requests, including credit analysis, financial statement analysis, real estate appraisals, and participating in client calls

  • Structure approvals to enhance  dealer relationships and

  • Monitor adequate completion of the credit approval process

  • Assist in the management of transactions and deal flow.

The basic qualifications required are as follows:-

  • A Bachelor's in Accounting, Finance, Business, Economics, or Management will lay the appropriate foundation.

  • Completing online credit management training through a credit management course from Imarticus Learning.

The skills required are as follows:-

  • Analytical and computational ability

  • Financial analysis  and numerical ability

  • Attention to detail

  • Decision-making ability

  • Efficiency and communication skills

  • Ability to work well under pressure

  • Should be technically savvy and should have excel and other spreadsheet skills.

Types of credit underwriter jobs

The roles available in industry segments for a credit underwriter are as follows:-

  • Loan or mortgage underwriter

  • Insurance underwriter

  • Equity underwriter

  • Debt  and security underwriter

Job profile:

Credit underwriting is a desk job requiring a lot of data analysis, calculations, and risk analysis. It also involves dealing with mortgage applications and credit processing. The starting salaries range upwards from Rs. 50,000 p.a.

A day in the life of a credit underwriter:

A credit underwriter plays a crucial role and is behind a financial institution's decision to extend a line of credit to a business or grant a loan to an individual customer. Credit underwriters conduct economic analyses of companies and individuals to determine their creditworthiness. They analyze all related financial documents and credit scores to decide their creditworthiness. They work in tandem with loan officers and assist them in assessing the accuracy of loan applications. Credit underwriters also play an essential role in deciding whether to revise credit limits and interest rates on the existing loans of qualified borrowers. Financial institutions and banks need to lend money to meet their business objectives, so credit underwriters serve the essential purpose of selecting the most suitable borrowers.

What is the process of credit underwriting? 

Credit underwriters look at the following 5 Cs to analyze credit:

  1. Character: A credit underwriter orders a credit report of the potential borrower from any one of the following three agencies:-

  • TransUnion

  • Experian

  • Equifax

    A credit report provides a complete analysis of the past borrowing habits of the borrower. Borrowers with late payments and delinquent debts show that they cannot manage their finances and reflect poorly on their creditworthiness. On the other hand, if you have a positive payment history, you are deemed a good borrower.

  1. Capacity to borrow: The borrower may already have a certain amount of debt, so the credit underwriter has to gauge his capacity to assume further indebtedness. Ratios such as debt to income are calculated by comparing the borrower's monthly income to the total debt amount. The level of indebtedness is also balanced against whether you have a high monthly income.

  2. Conditions: The credit underwriter assesses the underlying conditions as to whether it is O.K. to extend the loan. Adverse legal issues, the overall state of the economy, and the nature of the borrower's business are all taken into account.

  3. Collateral: The credit underwriter will check whether the bank has a lien against any particular collateral or security and the property's value that can be seized in a credit default event.

  4. Capital: The credit underwriter will check whether the borrower has sufficient capital/balance in his account to make the down payments and closing costs.

Key Takeaways 

As explained above, a credit underwriter plays a crucial role in reducing the Non-performing loans of a bank or a financial institution by making proper assessments and delivering sound credit decisions.

Visit: Imarticus Learning to learn more about credit management online training and courses. Contact us through chat support, or drive to our training centers in Mumbai, Thane, Pune, Chennai, Bengaluru, Delhi, Gurgaon, or Ahmedabad.

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