If you are a successful small business entrepreneur in America, I can generally group you into one of two groups:
You run a great business and are shrewd with your accounting…
You can qualify for a mortgage.
You mean that you can’t be a shrewd small business person and qualify for a mortgage?
Generally speaking… that is exactly what I mean.
During the big real estate and mortgage boom of the early part of the decade many lenders were offering Stated Income Loans which would come in various forms with wild acronyms: NINA, No Doc, Low Doc, etc — But in the last few years, pretty much every loan program at every lender has required that income be documented and verified which eliminated stated income loans.
I have seen my first ad from a wholesale lender who is starting to offer stated income loans and I suspect that now one is offering stated income loans, other lenders will follow.
Are stated income loans bad?
I don’t think any particular kind of loan is bad per se — but if a loan program is abused, that is when there are problems. But if you own a small business and happen to be shrewd with your accounting, the good news is that stated income loans may be making a comeback — which means you might actually be able to qualify for a mortgage in the near future.
Oh, and I hope someone figures out how to not let the waitress who makes $2.13 an hour qualify for a $500,000 house because she stated that she made enough to make the payments.
About the Author:Justin McHood calls himself a “Mortgage Commentator” and works for Academy Mortgage Corporation. You can find his loan officers at Ten Day Close and read more of his thoughts on the mortgage business on Zillow’s Mortgages Unzipped Blog. You can also find him at most East Valley Friday Nights gatherings. He’s the one in the blue shirt.