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To: ild who wrote (46740)	12/6/2005 3:48:15 PM
From: loantech	Respond to of 110194

You are entirely correct. On a stated income loan on a standard 1003 application, (the industry standard for conforming, non conforming, FHA, VA etc.) the income is entered into the exact same spot as verified income. In most cases I think the stated number is played with until the borrower qualifies. Of course the loan officer knows what it takes to qualify so they have a large input into what ever figure is used. You still list the source as you say but the figure for income on a stated loan I would say rarely is what the client makes. I am not in sales anymore. I tell the loan officers I work for they better have a figure they want to use because it is not going to be my BUTT because I ratcheted up the income to "fit". So once I see it I don't like to "play" with the number even though in my mind the numbers are patently false.

To: ild who wrote (46740)	12/6/2005 8:31:34 PM
From: Ramsey Su	Read Replies (1) \| Respond to of 110194

ild, Are you saying somebody states their income for them? I am saying exactly that, but we have to define it more clearly. Coincidentally, I was running through a scenario with a mortgage broker friend today. Here is the profile: Buyer has barely 5% down. FICO 610. Total debt service, including the new mortgage payments, would be about 60% of income. This profile just about ruled out all conforming loans. How about a 80-20 package? The 1st would have a start rated at 6.7% (SFR) or 6.95% (condo), IO. The 2nd would be 30/30 at 10.95% (sfr) or 11.2% (condo), fully amortized. Wait, that requires full doc so borrower would not qualify. "So Mr. Mortgage Broker, what can we qualify for?" "Well, Mr. and Mrs. Buyer, you can go stated. You need to find 5% down somewhere. Then I can do a 80-15. The 1st would be a 2-28 at 7.2% (sfr) or 7.45% (condo). The 2nd would be a 30/30 at 10.65% (sfr) or 10.9% (condo). No verification is needed for this loan and the borrower has to make $xxx to qualify." Mr. and Mrs. Buyer decided to choose the last option. Miraculously, the income on the application is $xxx. All the loan quotes above are current for today. That scenario, as Tom will tell you, is very very common. Loan applications are taken verbally, or scribbled, then nicely computer generated for the borrowers to sign.