Many people have wondered when stated income loans will be coming back to the marketplace and the answer may surprise you — they are already here. Here is some general information about stated income loans from one lender ( lenderline) who specializes in helping people get a stated income loan.
Stated Income Loan Program Guidelines
- Single family residences, PUDs, condos, townhomes and 2-4 units.
- No multi-family (5+ units), commercial or mixed-use properties.
- Purchase, rate & term refinance, and cash-out refinance.
- Primary residence only.
- No second homes or investment properties allowed.
- Minimum middle credit score of 700.
- No late mortgage payment, judgment, lien, charge-off, collection account within the last 2 years.
- If any notice of default, short sale, foreclosure, or bankruptcy appears on the credit report, the borrower will not be eligible forthis loan program, no matter how old the item.
INCOME, ASSETS & RESERVE REQUIREMENTS:
- Income is stated on the loan application but is not verified. The income stated must be reasonable in relation to the position ofemployment as determined by the underwriter.
- Debt-to-income ratios cannot exceed 40%.
- Verification of seasoned liquid assets equal to the down payment and reserve requirements must be documented by all pagesof the borrowers most recent 3 months bank statements. Large deposits must be sourced with supporting documentation.
- Borrower must provide liquid reserves equal to 6 months PITI. The reserves must be deposited into the lenders FDIC-insuredbank account for a period of 6 months as a condition of funding the loan. After 6 months, the reserves may be withdrawn.
- Borrower must contribute at least 5% of the purchase price from their own funds. Gift funds are permitted for the remainder ofthe down payment and the reserve requirements. Any gift funds must come from an immediate family member, such as
- mother, father, sister, brother, and be accompanied by a gift letter and bank account statements sourcing the funds.
- Verbal verification of employment for salaried borrowers required within 10 days of funding with no reference to income.
- Business license, CPA letter, or tax preparer letter for self-employed borrowers with no reference to income.