Glossary of Real Estate Terms (Oregon) – U

Underwriting – The process of analyzing a prospective borrower’s loan application to determine their ability to honor the terms of a loan for a specific amount of money upon certain repayment terms. It includes a review of the applicant’s credit history, employment, net worth, and a determination of the property’s market value compared to the amount sought for the loan. The final lending decision is made at underwriting. It does not usually occur until late in the real estate transaction which is why in the OREF Residential Sale Agreement, the financing contingency is not waived until the buyer-borrower receives either loan approval or loan rejection.

Up Front Charges – The bank fees charged to a borrower at the time of closing. This includes points, broker’s fees, pre-paid insurance premiums, and other charges.