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ParticipantIf the FHA is providing insurance on the loan, I assure you they will demand old tax returns, specially if they’re as recent as 2005 (That’s still an open year for IRS audits), if current income couldn’t have supported the original loan that is being refinanced. You’re right on the “I didn’t know” defense. But only if it’s credible. (A handwritten preliminary loan app, in the borrowers handwriting, for instance might mke that defense not credible) The FHA has a long history of demanding stringent underwriting standards. The last 4 years have helped many in the industry to forget the headaches of getting an FHA loan funded. They have never made it easy. I don’t suspect that will change.
ParticipantIf the FHA is providing insurance on the loan, I assure you they will demand old tax returns, specially if they’re as recent as 2005 (That’s still an open year for IRS audits), if current income couldn’t have supported the original loan that is being refinanced. You’re right on the “I didn’t know” defense. But only if it’s credible. (A handwritten preliminary loan app, in the borrowers handwriting, for instance might mke that defense not credible) The FHA has a long history of demanding stringent underwriting standards. The last 4 years have helped many in the industry to forget the headaches of getting an FHA loan funded. They have never made it easy. I don’t suspect that will change.
ParticipantIf the FHA is providing insurance on the loan, I assure you they will demand old tax returns, specially if they’re as recent as 2005 (That’s still an open year for IRS audits), if current income couldn’t have supported the original loan that is being refinanced. You’re right on the “I didn’t know” defense. But only if it’s credible. (A handwritten preliminary loan app, in the borrowers handwriting, for instance might mke that defense not credible) The FHA has a long history of demanding stringent underwriting standards. The last 4 years have helped many in the industry to forget the headaches of getting an FHA loan funded. They have never made it easy. I don’t suspect that will change.
ParticipantThe debt to income ratio of 35% is related to the loan being refinanced, not the new loan. Borrowers who have a smaller ratio typically don’t need to refinance, and the bill is designed to aid borrowers that are already distressed, ergo, the requirement for more than 35% on the old loan.
One of the other key terms of the bill requires that the borrower could not have lied on the original loan application. Income and assets cannot have been overstated. This will exempt a significant percentage of sub-prime loans that might otherwise qualify. It renders the bill almost meaningless. Significant for those few that might qualify, but nowhere near the 500,000 estimated by the CBO.
ParticipantThe debt to income ratio of 35% is related to the loan being refinanced, not the new loan. Borrowers who have a smaller ratio typically don’t need to refinance, and the bill is designed to aid borrowers that are already distressed, ergo, the requirement for more than 35% on the old loan.
One of the other key terms of the bill requires that the borrower could not have lied on the original loan application. Income and assets cannot have been overstated. This will exempt a significant percentage of sub-prime loans that might otherwise qualify. It renders the bill almost meaningless. Significant for those few that might qualify, but nowhere near the 500,000 estimated by the CBO.
ParticipantThe debt to income ratio of 35% is related to the loan being refinanced, not the new loan. Borrowers who have a smaller ratio typically don’t need to refinance, and the bill is designed to aid borrowers that are already distressed, ergo, the requirement for more than 35% on the old loan.
One of the other key terms of the bill requires that the borrower could not have lied on the original loan application. Income and assets cannot have been overstated. This will exempt a significant percentage of sub-prime loans that might otherwise qualify. It renders the bill almost meaningless. Significant for those few that might qualify, but nowhere near the 500,000 estimated by the CBO.
ParticipantThe debt to income ratio of 35% is related to the loan being refinanced, not the new loan. Borrowers who have a smaller ratio typically don’t need to refinance, and the bill is designed to aid borrowers that are already distressed, ergo, the requirement for more than 35% on the old loan.
One of the other key terms of the bill requires that the borrower could not have lied on the original loan application. Income and assets cannot have been overstated. This will exempt a significant percentage of sub-prime loans that might otherwise qualify. It renders the bill almost meaningless. Significant for those few that might qualify, but nowhere near the 500,000 estimated by the CBO.
ParticipantThe debt to income ratio of 35% is related to the loan being refinanced, not the new loan. Borrowers who have a smaller ratio typically don’t need to refinance, and the bill is designed to aid borrowers that are already distressed, ergo, the requirement for more than 35% on the old loan.
One of the other key terms of the bill requires that the borrower could not have lied on the original loan application. Income and assets cannot have been overstated. This will exempt a significant percentage of sub-prime loans that might otherwise qualify. It renders the bill almost meaningless. Significant for those few that might qualify, but nowhere near the 500,000 estimated by the CBO.
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