Prove That Income Or You Can Pretty Much Forget That Loan
Many lenders have eliminated stated income loan programs created to accomodate small business owners, professionals and entrepeneurs (e.g., the self-employed) because these loans have had a high default rate due to misues - by borrowers and lenders - and outright fraud. That is too bad, because now a large segment of homeowners/borrowers are frozen out of the mortgage market altogether.
Making matters worse, Fannie and Freddie will stop purchasing these loans from lenders, meaning these products will almost certainly go a way completely. Surely, it will take a while before the lending guidelines - which are now being over-tightened, after being too loose - return to normal. Here is a great Wall Street Journal article discussing this topic.
http://online.wsj.com/article/SB122818315556971151.html
Check out the rest of this week’s most important real estate articles in case you missed them.
http://www.car.org/media/pdf/Beyondtheheadlines_121108_2.pdf
Kevin P. Cummins
Realtor / Broker / Attorney
Coldwell Banker – Carmel Valley
Cell: 858-750-9577
Search the MLS on my new website at kevincumminshomes.com.
