Glossary of Terms

Underwriter 2019-08-14 08:00:00

Underwriter

An underwriter is an individual or party that measures or quantifies another party’s level of risk in investment or business engagement in exchange for a fee. Underwriting is a service required across many different industries and sectors, from mortgage issuances to insurance policies to initial public offerings. 

In the case of a mortgage issuance, an underwriter is tasked with measuring the level of risk a financial institution assumes in agreeing to lend money to a borrower, based on the borrower’s creditworthiness and current ability to repay his or her debts.