Origination vs Underwriting at a GSE lender
Hi guys!
Really appreciate any help in advance! I applied for a summer intern position at a GSE lender. They have two tracks- origination and underwriting. I am not sure which to choose. Can anybody who has worked in both help describe what the day to day is like? On a broad level, I know the the fundamental differences but on a more granular level would like to know what do you do.
My experience- not much lending, finance experience. Have 2 years real estate brokerage experience out of college (30 plus deals)
I can model cash flows, calculate dscr and debt yield, create an amortization tables. Basic modeling stuff.
My previous brokerage experience might make it seem like I am extrovert with an outgoing personality and origination might appear like a better fit, but I would not say I am an extrovert (or hugely introverted for that matter) or outgoing, I was just one of those weird quiet broker types who was good at selling when necessary. I am not opposed to origination though. I am a blank slate, so I am open to either.
Last question- I was told that in underwriting, there will be a requirement of creating summary opinions, economic and demographic research. For someone with no experience, will they typically teach me and show me the ropes, atleast provide me with a sample, or will I be thrown to the wolves?
Thank you so much for any help!!!
You have 2 years of experience and are applying for an internship?
I am in my MSRE grad program, so kinda starting from scratch. Plus transitioning to the lending/banking side of RE.
Id want to be on the origination side. You'll get to see more deals and focus more on the finance / real estate fundamentals of a property. You'll receive financials for a property, input them into the loan sizing model, do a quick analysis (should we underwrite to T-12 or T-3 and can we make a reasonable case for why we would underwrite to T-3).
Underwriting for GSE means a lot of document management, third party reports, investigation of the borrower's personal financials and real estate track record, dealing with lawsuits the borrower might be undergoing etc. They make sure the loan closes and the lender collects their fee.
Plus origination lines up more with your background. Origination guys typically go on to make more money than their underwriting counterparts in GSE assuming you stay in the industry
bump
bump, what are the top 2-3 skills that you would think an origination analyst would need to have or excel at vs an underwriting analyst.
ORIGINATION
Hi! Can you elaborate a little more please? Anything that makes you pick origination besides the pay/upside?
Origination focuses on bringing in business by screening deals (doing a quick review/underwriting the key factors), and then manages the overall relationships. The underwriters are the ones that get the deal after the originations team and credit committee agreed to sign it up. They then have to dig through the weeds, review every little detail on the deal, put together a comprehensive internal credit memo etc. It's a lot more grunt work than on the originations side and is less client facing. Nothing wrong with that at all, this is a better fit for some folks, but this is how it was described to me by all my friends on the lending side.
TL:DR - Origination = client facing dealmakers | Underwriting = very in-depth due diligence, managing closing etc.
What is the difference between originations vs UW?
So originators I get, they originate deals but they do there own analysis as well. The deal than gets brought to the UW team to do analysis. What's the difference?
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