Upheaval in the
Mortgage Industry Effects Stated Income Construction Loans
In view of
the recent developments in the mortgage industry sparked by the
collapse of the Sub-Prime mortgage market has far reaching
consequences that will affect the way mortgages were underwritten
for the foreseeable future.
We decided
not to remove the page that was dedicated to stated income
construction loans but to add this new addition.
In our page
(this) about the stated income construction loans we did stress that
a stated income mortgage is not a license to lie! These loans were
designed to minimize paperwork for self employed borrowers whose
documentation was complex, and yet they were used to inflate
incomes.
Originally
(when introduced many years ago) they were limited to 75% loan to
value and were then offered for much higher loan to values sparked
by the advent of over-aggressive sub prime lenders and the desire of
the main mortgage lenders/investors to compete in the stated income
market.
As real
estate values fell and foreclosure numbers grew, lenders realized
that to continue with the policy of tolerating lies and qualifying
the unqualified is no longer going to work and will lead to
financial ruin.
Were the
lenders really aware of what they were doing? Of course… I’ve been
working in this industry for twenty one years have witnessed many
slow downs and value drops. The CEOs of the huge mortgage lenders
will never admit it publicly but to claim that they were unaware of
the massive volume of fraud is simply to admit gross incompetence.
In any
event, one investor after the other is either dramatically revising
their guidelines of scraping the programs altogether, which very
often effects even approved loans that are waiting to be locked.
Stay tuned for the details of further
developments.
More:
Upheaval in the Mortgage Industry Effects
Stated Income Construction Loans
The
recent developments in the mortgage industry sparked by the
Sub-Prime mess effect stated income and no income qualifying loans.
The Original Stated Income Construction Loans
Page
This is the original page which was written back in 1999
Questions?
Call us Toll
Free or Send an Email,
with any questions or concerns that you may have. Visit Our
State Specific Contact Page,
where you can find our phone numbers to call us, contact us by email
or complete our short, secure application form.
|
