Underwriting Drudgery
I find myself stuck in an underwriting career and I'm struggling to figure out where to go from here. The job is mostly an exercise in pushing documentation through endless layers of bureaucracy at my workplace, and as a result I find most of what I do is a waste of time and utterly devoid of meaning. I am paid fairly well and I have flexibility in my work, but I'm not sure how much longer I can keep up the quality while so actively disengaged. I'm curious if anyone else here is or was in a similar position...
Former underwriters - where did you go after underwriting?
Current underwriters - do you find your job as dull as I do? What's your plan for the future?
What type of company? third party UW? lender? broker? equity?
1. Start asking to be involved on other stuff, if they don't let you it's time to leave
2. Start getting smart with the UW and point out things you're doing. We all know tweaks to make a deal look good on paper, there are different levers. Pull some levers that are justifiable and point out what you did to make yourself more valuable. Present different scenarios. People will think you're smart and maybe help put new things on your plate
3. Bring in business if you can
4. Or, if you're not happy just leave. UW is a need and a critical skill at every real estate company. From appraisal and prop mgmt to lending and equity. Every group needs someone to UW whether that's an internal person or external and believe it or not it's hard to find those people. So if you're young and can do an analyst/associate role you can go just about anywhere. If you're not already argus certified go pay $1.5K to get that done. It's a useless badge that people place a lot of value on for some reason. Doesn't matter if you're already good at argus go get the certification.
I'm currently at a bank, though I've worked as an underwriter in a different capacity and left to see if the grass was greener at a different company (it isn't). Good points, I can try speaking with my manager about getting involved in different types of work. No doubt underwriting is a necessary task, I just have not found any satisfaction doing it.
Are there any aspects to the job you enjoy? That should give you a good indication of what types of work you should either take on more of or alternatively see if you can change to a role which focuses on it. Your description of "Drudgery" I can apply to my current acquisitions role. It's a great role on paper, I'm just finding it completely unengaging and meaningless as there's few aspects I like about the work. My plan is to go back to GP side as I find debt / LP equity pretty mind numbing at this stage.
If you're doing line of business underwriting at a bank I guarantee there are opportunities for you to pivot to tangential roles across Corp Dev, Strategy, etc. Up to you to decide if that interests you more or less relative to UR, but I know for a fact those teams would kill to have a smart, curious, hardworking person with deep understanding of whichever business you sit in. Candidly much easier to teach you the processy deal stuff than have a deal person familiar with the process but not the technicals.
Your skills can be used in a front office capacity. Everyone needs to understand the basics of underwriting to talk to a client. Your underwriting skills have well prepared you for a DCM or ECM position. Try to find something where you can move up and someone else has to do the underwriting under your direction. Or at least work towards movement in that direction. Underwriters are hard to find. It's a very useful skill that takes years to be really good at complex deals.
I worked in underwriting at a bank for almost 7 years and I felt the same way. I knew I didn't want to be a banker or a credit officer and that if I ever wanted to change things up, I would have to leave. I've been working in valuation at a Big 4 for the last year and I really like it! It's been way more challenging than I anticipated, and we value properties all over the world so there's a good amount of travel. The other plus is that I was by far the youngest person at my bank, and it was a very stodgy environment. The Big 4 skews pretty young and I'm not at all the youngest anymore. Lots of fun parties, dinners, travel, happy hours - I'm really glad I made the change. I don't have kids though and I think if I did or if that was a plan for my immediate future - I would have stayed in banking/underwriting working 30 hours a week.
Even within the same company, groups, offices, even teams operate in their own way. It sounds like in your particular situation the lending process is very siloed. In my career I was fortunate to always be on teams that handled the lending/acq. process end-to-end. You could get a job where "underwriting" is your "job" but it's not siloed. So sure maybe you get a lending job somewhere and use all those skills you've been building as an UW, but at this new spot you meet with brokers, help on the structuring side, work on the loan docs/legal side, work on the closing, third parties, etc... There are lots of jobs out there like that but you have to figure it out before you join.
meant to reply to your comment not OP but w/e
I’d suggest a movement to the equity/ownership side of the business (assuming you’re doing debt UW).
Youll still have a lot of transferable skills and you’ll be able to understand all the assets you’re working with from a financial stance no problem.
Maybe look at an asset management, development, or acquisitions role (IMO this would be the most similar). In all of these positions you’ll get exposure to new concepts, a totally different perspective on the business, and your background in debt UW will be well regarded.
I switched from Affordable debt underwriting to working in investment management for a sponsor/developer and it is genuinely the best decision I’ve made in my life in a long while. You’d be surprised how many folks at RE companies don’t have a deep financial knowledge like you need to be an underwriter, and you’ll be well regarded. Look for a smaller and more intimate company where you can use your financial wherewithal and valuation skills to help at all stages of a project - from thesis through execution and holding. The exposure is phenomenal and I guarantee will give you a refreshed view on work and RE.
Good luck and feel free to respond here if you wish to continue the conversation or ask me any questions!
I've actually been working in Affordable equity underwriting for a number of years. I've been thinking about switching to the development side for a while...
I definitely need a refreshed view on work, I feel like I've just been going through the motions for years and I don't feel challenged anymore. What do you mean by investment management for a developer, what kind of work does that role entail?
It’s a unique name for sure. It’s essentially a blend of Asset management, and financial oversight for dev projects. At our company the dev associates are primarily past engineers, designers, project managers, and they handle all the consultants planning etc. Every dev/heavy rehab project has 1-2 IMs for all proforma, modeling, business plan work.
We’ll come on board a project essentially once we start collecting DD and we’ve reached a PSA, and stay on through the first 6 months to 1 year of operations and then hand off to an AM.
Can you explain what you mean by deep financial knowledge?
Eh- deep isn’t the most accurate word. Just experience and background in the field. A lot of people in RE work with the people and the asset design, building, experience etc- and they’re not too involved in modeling, valuation, debt and structuring deals.
The fact that you have worked in Affordable equity underwriting separates you from most underwriters, so you will be fine if you were to pursue affordable development or even work in another affordable facet on the debt side. That universe is pretty small and you must have interacted with many stakeholders who can be a resource to you. You are in a way better position than vanilla conventional GSE, bank, life co, etc underwriters trust me. Underwriting is pretty much well paid but boring work. Like soul crushingly boring. I have seen how GSE underwriters and bank underwriters operate. It does not matter if you underwrite stabilized loans, construction loans or something unique like subscription facilities, it all becomes boring after a while. Often on the institutional side, as an underwriter on the debt side you dont really work closely with the acquisition folks on the equity side. Sometimes you will see a cradle to grave approach, but often I see "screeners" size deals upfront and once an app is signed only then the underwriter is involved. So your counterparty on the equity side is maybe asset management or portfolio management and legal counsel. Lots of back office folks who will get you the requested stuff and you just work your way down the checklist before closing. Tough to make the jump to originations when you do not have the contacts and strong relationships within acquisition professionals or brokerage and investment sales. Originators will have way stronger relationships with them. This means underwriters just stay in underwriting and jump between GSE shops or banks but let be real most just stay put and become an office space character. That's just the nature of the job. Day in and day out, summarize another PCA, ESA, phase 1 and work on another ASR for credit. Just copy, paste sections of a previous ASR, rinse and repeat. Dont get me started on the annual financial/portfolio reviews lol. Talk about doing work for the sake of it. Or some will become a part of the credit team and that will be an "upgrade" for them, how exciting!
You're exactly right - it is soul crushingly boring. Haha, I already feel like I'm becoming a character in office space...I need to get out before I turn into Milton.
This sounds bad, but when "career" underwriters start to talk, I can often tell that they have been underwriting for a very long time. Like they have been locked in a room with appraisals and due diligence checklists for many many years.
Oh god I do NOT miss DD checklists
Damn. I’ve just started underwriting Affordable debt and this is accurate. Everything is already screened and sized, so all I’m doing is the mind numbing work after that.
The bankers seem to do some actually interesting work - communicating with the client and working with them to size a loan sounds so much more rewarding and engaging.
I’m in a great spot to learn about affordable housing and the pay is very good…but I don’t want to become an Office Space character, and I can feel it happening. The bland conversations I have with my coworkers 🥲
I’m pretty introverted, I can’t lie, but this job has made me realize I’m not THAT introverted.
OP if you move jobs, please update this post with what you do.
I could have written this exact thing. Being a banker sometimes seemed fun and engaging but arguing with credit every week seemed like a nightmare and I knew I couldn't do that.
Tragically accurate.
I did underwriter as a credit analyst in equipment finance and loved it. There was exposure to tons of different industries and companies so never knew what I was gonna get. I enjoyed being given a new company learning everything about it as quickly as I could then writing up a report highlighting there strengths and risk.
I feel your pain here, as that is exactly how. I felt. You are a paper pusher at the end of the day. Some people like that and are happy to oblige, collect the check and have relatively low key hours compared to the rest of real estate. I literally felt it crushing soul as well.
Eventually moved to a developer and it has been night and day. Like a weight lifted of my chest. Can’t say it would be the same for you, but just my personal experience.
Now when I’m on calls with lenders and we’re going over checklists for closing, I can hear the defeat in the voice of the UW on the other side.
I started as a GSE underwriter out of college and this is giving me flashbacks. There is a type of person that is a career underwriter and there is nothing wrong with that, but it certainly wasn't for me. I now work for an operator in acquisitions/debt capital markets. It truly is a night and day difference.
I pursued graduate school, but I do not think it was truly necessary. Network your way out into a role on the principal side.
Do you think you get paid enough for your role? I know down the road for myself i might look into transitioning into Asset Based Lending or getting into Data Analytics but otherwise i think learning how to program would be essential in the future.
Yes. I fortunately bring in a little business now, but the core part of my job is boring and at this point I just go through the motions. The deals are already structured and I’m just doing confirmatory dd and closing them. People making comments about lifetime underwriters are right - they are a special breed of very risk averse people who love running through checklists. My coworker remarked in passing that he’d been doing this for decades and my first thought was “wtf why”. Good luck all. Trying to move to acquisitions or originations but a little tough in this economy. There are still firms looking though
Fiancé is an underwriter too and in the same boat. Paid well but she is bored so she is launching a financial consulting service for businesses with $3m to $15m in revenue. Basically helping with things like setting up 13w models to maximize cash sitting in the business.
I work at a valuation firm. I would say we get a fair amount of new hires from underwriting/banking as most of our work focuses on illiquid debt and complex securities.I feel like that would be a natural move.
Can you expand on the valuation firm? That didn’t even cross my mind as an exit as that sounds further removed from deals and decision making.
CRE, analytically, is cookie cutter and dull. People who are U/W positions long-term are typically "work to live" not "live to work types." However, there are not too many jobs out there that offer ~$150k/year to work ~40 hours a week with hybrid/remote options. If you are not someone trying to max out every aspect of your career/earnings, that is an incredibly nice setup.
What aspects/parts of CRE do you not consider 'cookie cutter and dull'?
This sounds like what a lifelong underwriter needs to tell themselves to justify their low comp. It’s not 1999 anymore - there are plenty of jobs that pay $150k a year for 40 hours.
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