NLIC.org

Erik Said:

Mortgage programs with stated income borrowers?

We Answered:

If you could get a better LTV it would help a lot, you're skating too close to the line even with a non traditional lender. Do you have a credit union available to you? That may help. You would be A paper with an 80/100 LTV. Can you get documentation to prove that property values have risen to that extent or is your market stagnant or has gone down, those are all factors. Whatever you do don't have all these people look up your credit score or it will go down, you probably know that already but thought I would mention it.

Kevin Said:

my mortgage lender rejected my application for a loan modification, they stated "insufficient income"?

We Answered:

You refinance to move to another bank.

They refused the modification because according to the numbers you will go into foreclosure after they modify the loan anyway because you can not afford your bills and a lower mortgage.

Rafael Said:

looking to apply for mortgage loan BUT W/ STATED INCOME?

We Answered:

I am not having any trouble. Just use your tax returns, that works as proof of income.

Alfredo Said:

Will the new rules by the FED mean no more stated income loans?

We Answered:

I've been trying to figure this out myself, and from what I can see, the original proposed rules were for subprime borrowers, and some ALT-A borrowers (better credit but stated income, low doc, etc.) The reason the ALT-A borrowers were included was the Fed was concerned that some subprime borrowers would be re-classified as ALT-A by lenders trying to get the loan done. So how would the Fed determine if the loan was a Subprime or ALT-A loan requiring regulation? If the rate is 3 points (3%) above Treasury Rates, it would qualify. These proposed rules came out several months ago, and there was comment by consumer groups as well as lenders. Consumer groups wanted *all* loans to include income verification. Lenders said that including ALT-A borrowers in the rules would limit credit (we're already in a credit crunch with some borrowers, so let's just add more of them!) Based on the new comments, it looks like some, if not all, ALT-A borrowers will be covered by the new rules, which will be released in detail next week. I'm anxiously waiting to find out which borrowers will be covered by the rules myself. If all ALT-A borrowers are covered, then it's going to be even harder to unload all the houses on the market because *many* borrowers with outstanding credit need to use low-documentation loans for a variety of reasons, including being self-employed. Lets keep our fingers crossed on this one, because it really does not seem fair that a person who is very conservative with their finances, has an 800 credit score, etc, would not be able to buy a home because they don't meet the debt to income ration requirements and are no longer permitted to go "no income verification."

As far as when they will take effect, I'm assuming immediately, since the Fed does not have to go through Congress to get their rules passed. It's their job to regulate banks, and this would fall under that catagory. I'm not sure, but I'm guessing all loans in the pipeline (not yet closed) will be covered under these rules. This is just an educated guess, though. So it's going to be very touch-and-go for some borrowers in the coming weeks. Sorry I can't give you better news right now.

Dustin Said:

Are there any Mortgage lenders that will do a Stated Income Refi(no cash out refi) on a Non Owner Occ?

We Answered:

First of all, you do not stated what loan to value you are looking for. This is a very important factor. Also, just because you are self employed does not necessarily mean you have to go stated income. You say you have been in business for 10 years. They might be able to use your tax returns to qualify you. If you are trying to obtain a high loan to value then you most likely have a hard time finding financing right now. My recommendation is to contact a local reputable lender (ask your friends who they used) and have them evaluate your situation for you. Make sure your current loan does not have any prepayment penalties either. I am assuming you have an adjustable rate you want to get out of.

The lender will use the current appraised value on your property.

Feel free to email me any questions. Good luck