EricJ
Joined: 09 Jan 2009
Posts: 321
Location: New Jersey
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| Posted: Thu Oct 29, 2009 10:48 pm Post subject: Stated Income Mortgages - Loans in California |
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Everyone (mortgage professionals on this site),
A lender I work with is getting back into the stated income business in California. This is really good news for homeowners and self employed borrowers in that state. However, there are some strict guidelines....
Loan amounts of $418k - $1.5mm
Self Employed and Owner Occupied only
60% LTV for both purchase and refi
Maximum cash out of $300k
12 months PITI reserves
Now this is the kicker......you must have a $100k depository relationship with the bank at closing. Yes, the account is FDIC insured.
Products are the 5/1, 7/1 and 10/1 ARMs only and rates are below 6%
So, based on what I mentioned above, this is not for everyone. However, the fact that another bank is willing to cross over to the dark side is a good sign. There are so many self employed borrowers in California who really need stated income or no income verification mortgages and loans.
Long term, I believe the underwriting guidelines need to change for the self employed. They should be looking at income that is somewhere closer to the gross amount on the tax returns and not the net.
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