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Chris Salese

I’m going to state the obvious.It doesn’t matter if you are a lender or a Realtor, inevitably you’re going to feel the pressure every so often from either the consumer or from someone else in the housing industry to “do whatever it takes” to make a transaction happen or to cut a corner sort of speak.

Unfortunately, the frequency of these occurrences always seems to be more pronounced during a changing market.

Sadly, there are even a few who still seem to incorporate unethical practices into their business model for their own gain.

As such, you cannot, under any circumstance, compromise your values or wade into illegal waters and cross the line.

While the interest rate elevator rises from the basement of historic lows, lenders continue to release loan programs that carry looser guidelines and easier qualification criteria to bolster their declining loan origination volume due to higher interest rates.

It’s the natural cycle or standard operating procedure put in place to better manage the economics of running their company and to continue to offer the consumer different home loan options.

For those who are not new to the mortgage business, we have seen this happen before at different times in our careers. It’s important for the long-term sustainability of our mortgage world that it does.

For example, there are two types of loan programs floating around right now that are mainstream with many lenders.

This means that most lenders have access to them and their marketing departments just present them in different ways to you.

They’re primarily designed for borrowers who have significant verifiable assets or who are self-employed and would benefit from alternative loan qualification methods.

Basically, the idea behind the programs is to help you document your ability to repay your loan in a non-traditional way.

One of the programs solely leverages your asset account statements for qualification.

There’s no debt to income ratio requirement and you might be able to borrow up to $3 million with a FICO score of only 600.

Typically, this program may be used by high net worth individuals for qualification but with the aggressive lower FICO score option, it certainly opens things up to more consumers and lenders alike.

The second program is built for those of you who want to utilize your most recent 12 months of bank statements for qualification.

This is a bit different than the asset account statement option above. Your bank statements, personal and/or business, may be used as an alternative to tax returns to document your income if you were, let’s say, self-employed.

Furthermore, a self-employed borrower could supplement their bank statement income with additional income derived from an asset amortization formula.

It’s a little complex, yet with the FICO score floor also set at 600, debt to income ratios at 55 percent, up to a $3 million loan amount is available.

Regardless of the loan program, work through the details carefully and don’t let the looser guidelines push you over the line.

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Chris Salese can be reached at or 707-363-4439. He is a licensed California mortgage lender (LO NMLS #254469 — CA-DBO #254469 Corp NMLS #1169 Equal Housing Lender.