What does a refer/eligible status in GUS indicate about a loan?

A refer/eligible status in GUS (Guaranteed Underwriting System) indicates that the application does not meet all the automated underwriting criteria set by USDA, but it is still eligible for a manual underwriting review. This means that while the automated system has identified certain factors that may require further human analysis, the loan is still potential for approval contingent upon a thorough review of the borrower's circumstances and additional credit factors.

In this context, a loan marked as refer/eligible does not imply an outright denial or automatic qualification for approval. Instead, it signifies that the loan warrants further consideration. A skilled underwriter can evaluate the specifics of the applicant's financial situation, compensating factors, and any applicable exceptions that might allow for approval despite the initial findings from the automated system. This process emphasizes the importance of human judgment in the underwriting process, especially in cases where the automated system might not fully capture the borrower's strengths or special circumstances.