stated income on mortgage refi question?

Question

a friend will not state i work for her so i can refinance because she says she will have to report taxes/benefits, ect on me which i believe is false. they just want to know i have a job. PERIOD. they never even ask salary or anything. just your job title and how long you have had the job. she says her "whole financial situation" comes under scrutiny which is NOT true i believe.... any mortgage people know the truth? I know its a common practice with a solid financial background, that people state income and are not working at all...... she said her LAWYER advised her on this and i think thats bull....

Answer 1

Under the stated income program, the lender will call your place of employment for verification that you in fact work there.

You are correct they will only ask if you work there and if they get away with it how long and perhaps how much your earn, but that is unlikely.

Now once they have verified that you work there they will get the fed book that have EIN#'s to verify that this is a viable business where you work.

Now this get a couple of innocent people in trouble, the person that verified you work there and the mortgage broker and mortgage agent that submitted your loan for underwriting. (I would hope that the mortgage broker and mortgage agent is not in on this caper)

The person will probably not come under investigation, but there is a slight chance that they could, so that is why she will not take a chance on lying for you.

There are lots of stated income programs, but the applicant have a verifiable job and the job is real.

I hope that this has been of some use to you, good luck.

"FIGHT ON"

Answer 2

I'm not sure by your question if you actually do work for her. If you do, are you being paid under the table?

If not, she is right not to tell them that you work for her, but for the wrong reason. That is fraud, and the IRS is now working with mortgage lenders to help prevent just that kind of fraud. If you can't produce a W2, the lender can ask the IRS for proof of previous years income. They will know you are lying about working, and prosecute both you and her.

Answer 3

All of her statements are not necessarily true, but in this day and age, you are asking a lot from a friendship. Let me explain:

This situation you describe is referred to as a W2 Stated Income loan program (commonly referred to as "the liar's loan"). I've been in lending since 1989, so let me tell you this: with the demise of the sub-prime market in the mortgage industry, even the prime loan candidates (such as yourself) are coming under scrutiny.

If you were enrolling in a "self employed, stated income" program, your situation would be much more flexible. But since you are asking your friend to not only lie to a lender, but to potentially falsify a W2 earnings statement (which falls under federal guidelines)...you are asking her to really stretch your relationship. Even though you have strong credit and you are being taunted by this "stated" program, remember this: With the nationwide enslaught of foreclosures, you will be required to sign a document that gives the lender the permission to spot check the nature of your employment by requesting a copy of your latest paystub and/or W2 from your employer. If they determine that documents were falsified, they will demand the loan to be paid in full immediately and would accuse your friend of conspiracty to commit fraud. I would strongly recommend that you NOT throw caution to the wind in this situation.

Read between the lines, put on your thinking cap and ask your lender (or find a different one) to provide you with the guidelines for "self-employed, stated" programs.

Stay calm about this and you'll be victorious.

Answer 4

If you're getting paid "under the table" then your friend cannot say that you work for her.

The mortgage company will investigate if her company is legimate, it's true. It's not bull.