A stated-income loan (SIL) qualifies a borrower using the income the borrower states, as opposed to the income the borrower can document. With an SIL, the lender agrees not to verify the income the borrower states on the application. SILs are priced higher than fully documented loans, and the foreclosure rate is also higher. With overall foreclosure rates reaching uncomfortably high levels, SILs have emerged as a possible weak point in the underwriting process. Regulators and legislators have been considering whether they should bar SILs or limit them in some way. Restricting SILs would be costly. The SIL was itself a response to limitations of the underwriting system. Many prospective home buyers have the income to afford a mortgage, but can’t meet the standards of full documentation.

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Home buyers and sellers may have reason to cheer with the recent Fed action. The discount rate is the one the Federal Reserve charges qualified lenders, mainly banks, for temporary loans. Lowering interest rates encourages banks to lend more money to mortgage borrowers. That in turn could make it easier for home buyers, especially those using big-ticket loans called Jumbos, to get financing. The critical issue was getting the jumbo piece moving. Once that moves, then getting Alt-As moving and then even subprimes are next.

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Over the past couple of years leveraging one’s assets with a low down payment mortgage has morphed itself away from those who don’t have any down payment money or for those qualified for a VA loan — to those who have down payment money but don’t want to use it. There are numerous books that discuss the subject, making a lot of sense. The math works when you compare investing money and compound interest and such and had been so popular it has spawned other books just hitting bookshelves promoting the same idea just in different formats.

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Federal bank regulators have published a new set of forms designed to give borrowers a better understanding of mortgages that can adjust to dramatically higher monthly payments. With increases mortgage defaults, consumer advocates say many lenders encouraged consumers to focus on the initial low-rate “teaser” period without fully informing them that their loan payments could jump up in the future. The revised disclosure forms are intended to give consumers clear information about the risks of adjustable-rate home loans. Lenders are not required to use the new forms and are free to alter or design them as they see fit. However, banking institutions generally follow the regulators guidelines, which only apply to federally supervised institutions, not state-regulated ones.

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Mortgage pre-approvals will definitely generate an inquiry because the lender is making a loan commitment. A lender’s prequalification isn’t a loan commitment but will show up as an inquiry if the lender pulls your credit report at your request. Mortgage and car loan inquiries are treated a little differently than when you apply for a credit card. If you are shopping around for a mortgage and apply at several places, the multiple loan applications won’t hurt your credit score as long as the applications were made over a relatively short period of time.

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Buyers of pricey houses and loan applicants who don’t want to prove that they told the truth about their incomes are finding that money has suddenly become more expensive to borrow. Rates on jumbo mortgages have skyrocketed recently, even as rates on conforming, fixed-rate mortgages slipped downward. This is bad news for people who want to borrow more than $417,000 to buy a house or refinance a loan, or who can’t or don’t want to document their income. Rising jumbo rates make it more difficult to sell a house costing half a million dollars or more.

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This one-of-a-kind lakefront lot is truly unique within the Malone Bay community. It is one of the most desirable, if not the most desirable lot among the few remaining properties with waterfront access to W. Kerr Scott Lake.

Malone Bay features 18 lots at W. Kerr Scott Dam & Reservoir. 14 are Lakefront and meet private dock requirements. This is a gated community with Lots ranging from 2.3+- acres to 6.8+- acres On the Hwy 421 side of the lake just off South Minton Road, Wilkesboro, NC 28697

Main Channel Views.
300 feet of waterfront.
Dock with boat slip and 2 jet ski slips.

2.86 acres.

MLS Number: 51155
List Price: $359,000
Lot Size: 2.86 ac.
Apx Acreage: 2.86
Type: Waterfront
Area: Area 2
Suitable Use: Residential

Topography: Rolling
Utilities: Underground Utilities
Road Frontage: Private Road
Restrictions: yes
Water/Sewer: Public Water
Miscellaneous: 1-5 Acres
Location: Malone Way

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Some lenders, for a fee, will modify a loan contract. Because the rate on your mortgage is so low, it would be in the lender’s interest to have the balance paid down, even if not completely. Assuming the lender is willing, you can use your free assets to pay down the balance and then modify the contract based on the new balance. This would allow you to retain the 4.75 percent rate on half of your loan. If you pay off half the balance and the rate and term remain the same, the payment would fall by half as well. This would give you the peace of mind you are looking for.

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The credit crunch that began three weeks ago reached its end stage yesterday, the Euro-American banking system locked up altogether. Dramatic, but not dangerous: central banks are pouring cash into the system. Ice water will quiet a mob of hysterics, but will not solve the underlying problem. Which is: massive credit losses in the aftermath of The Great Credit Party, 2000-2006 (R.I.P.). So far, market losses on mortgage and other derivatives merely anticipate the actual credit losses from default and foreclosure, whose magnitude markets cannot know until well into 2008. One good solution is available, suggested timidly by a few public officials: get the handcuffs off the Fannie and Freddie portfolios, and get them into the market as buyers — and not just their traditional product, but any well-underwritten paper of any size or type.

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Now that the problems in the sub-prime market have led to a revision of guidelines for conventional home loans, it’s more important than ever to maintain good credit. As in the past, solid credit and a fully documented annual income will still result in mortgage interest rates that are very attractive. News about the mortgage market is changing daily, so it’s important that you’re working with a home loan expert who knows and understands what all the market activity means for you and your mortgage. Understanding what kind of mortgage you have and the terms you’ve accepted is crucial in these market conditions.

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