Loan Underwriting Processes

Commercial underwriting is a critical process for the approval or rejection of a loan application and helps the lenders to decide whether they should approve the loan request or not. The loan underwriting process is based on a risk evaluation and determines the ideal loan amount the borrower is eligible for on the basis of their income, credit score, and other aspects. However, the traditional underwriting process was carried out manually by an underwriter which proved to be quite time-consuming.


This is why automation has been introduced in the world of underwriting to save manual efforts and generate accurate results. Lenders are increasingly getting inclined towards using automated loan origination software For all types of loan applications. The algorithms used to make the loan underwriting software leverages algorithms that eliminate the need for human efforts or manual decision making, thus reducing the possibilities of human-made errors.

Apart from that, consistent decision making, improved operational efficiency, and enhanced customer satisfaction are some of the prominent features of using automated loan underwriting processes. Let us dive deeper and understand the significant benefits of adopting an automated underwriting system:

1. Enhanced workflow

Unlike manual underwriting, where the data is prone to theft or misinterpretation, the automated underwriting software allows the processes to pass seamlessly through all stakeholders involved in the underwriting process. The enhanced workflow ensures better customer satisfaction, making the processes quicker and easier. Furthermore, the individuals involved in the manual underwriting process are free to devote their time to more urgent tasks leaving the loan origination services in the hands of automated software.

2. Accurate fraud detection

Automating the complete underwriting process lowers the instances of fraud. This is because the algorithms used to design underwriting software uses predictive analytics to identify the risk involved in the loan disbursal and underwriting beforehand. Moreover, loan underwriting software detects fraudulent activities even before happening and raises the red flags immediately, reducing the chances of fraud.

3. Consistent decision making

The algorithm used to make the automated commercial underwriting software is based on standard processes and maintains the standardized policies. Automation enables the lenders to underwrite and disburse the loan by following the standard procedures. Since every private lender or financial institution such as a bank has different underwriting policies that impact the complete loan process, the automated underwriting software can be customized according to one’s requirements. Moreover, Unlike the manual underwriting process, which is prone to miss out on certain factors, the automated software covers the minute details and does not miss out on anything.


Automating the commercial underwriting processes is extremely beneficial as the software can be customized to suit every business’s needs. To learn more about the automation in the loan application and disbursal of the loan amount, connect with deciphercredit.com and explore further.

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