Underwriting

Definition

  • The process undertaken by a financial service provider that consists of assessing a client for eligibility for a financial product (such as insurance, equity capital, credit or mortgages) and potentially issuing or distributing a product.
  • To support or agree to (a decision, for example). In real estate, underwriting refers to the analysis of the risk involved for a lender to grant a mortgage loan and whether or not the risk is acceptable. Underwriting involves a property evaluation as outlined in the appraisal report, and an evaluation of the borrower's ability and willingness to repay the loan.

Synonyms
accepting, sponsoring, endorsing, verifying, insuring, promoting, qualifying

Acronyms
UW

Related Terms and Acronyms

  • Captive Finance Company Definition,
    • A finance company related to a specific dealer or manufacturer.
  • Credit Rating (CR) Acronym, Very Important,
    • A judgement of a person's ability to repay debts. The rating is often based on a person's current and projected income and past debt payment history. Also called a credit score.
    A metric to measure the credit worthiness of a debtor.
  • Credit Report (CR) Acronym, Very Important,
    • A report on a loan applicant's willingness and ability to make payments in a timely manner in the past. This report is provided to the bank by an outside agency.
    A report that outlines the credit worthiness of an individual or entity.
  • Insurance Cycle Definition,
    • A cycle of soft and hard market conditions observed in the insurance and underwriting industry.
  • Investment Banking (IBK) Acronym,
    • Bank operations that manage a bank's funding position, as well as its holdings of Treasury bills, bonds and preferred and common stock.
  • Lloyd's of London Company,
    • A market for insurance and reinsurance based in London, England where Lloyd's members, underwriters and financial backers can spread and share risk.
  • Lloyd's Syndicates Definition,
    • A group of Lloyd's of London underwriters.
  • Mortgage Broker (MB) Acronym, Important,
    • One who finds clients perspective lenders at generally no cost. Mortgage Brokers have a special relationship with lenders and can offer their clients the best rates and service. CanEquity goes through great lengths to ensure you are serviced by the best Mortgage Brokers in Canada.
  • Premium Definition,
    • A payment made to an insurance company for insurance coverage.
  • Premium Balances Definition,
    • A ledger kept by insurance companies recording insurance premiums.
  • Premiums Written Definition,
    • A sum of the premiums from all the policies that a company has written in a given period of time.
  • Secondary Market Definition,
    • A market where financial instruments such as stocks, bonds, options and futures are bought and sold to investors.
  • Underwriter Definition,
    • An entity that issues and distributes financial products including equity capital, credit, mortgages, and insurance.
  • Underwriting Guide Definition,
    • The rules and guidelines an underwriter must follow while writing policies.
  • Underwriting Risk Definition,
    • The total amount of risk an entity takes on from underwriting something.
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