Risk Analysis

Information by State  Print version

Chapter 2
Mortgage Credit Guidelines
Page 2-20

DE Underwriters must be cognizant of the increased potential for default when individual risk factors are combined. For example, a borrower with a combination of an ARM loan, high LTV, no reserves, and high ratios may need to be evaluated more carefully when granting approval. Although FHA offers high ratio loans; an underwriter has the option of approving a loan subject to an increased down payment in situations where excessive risk factors are layered.