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CoralSnake
9153 Posts |
 Posted - 03/27/2008 : 6:28:49 PM
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Every now and again, a broker sends me a 1003 and I see listed under assets a car, a boat, and other weird things as assets.
Now I do know there is a section for this.
But in the arena of residential mortgages, what lender in the world cares if the guy has a 2001 Toyota Corolla worth $6000?
Do any of you guys do this and why? |
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khoiey
910 Posts |
Posted - 03/27/2008 : 6:29:58 PM
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I do. Sometimes it help with DU? lol... But if it's there I just ask the borrowers, which makes it seem dramatic!
quote:
Originally posted by CoralSnake
Every now and again, a broker sends me a 1003 and I see listed under assets a car, a boat, and personal property as assets.
Now I do know there is a section for this.
But in the arena of residential mortgages, what lender in the world cares if the guy has a 2001 Toyota Corolla worth $6000?
Do any of you guys do this and why?
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 6:30:04 PM
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And another one- sometimes I see "personal property- $12,000".
Now we are using our couches and armoires as reserves? |
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actionjackson
1109 Posts |
Posted - 03/27/2008 : 6:30:58 PM
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man I get them with Jewelry and fur coats sometimes. LOL
Jason J. Miles
Cornerstone Bancor Mortgage Corp
1-866-WE-LEND-U/1-631-225-7096
1-800-538-0794/E-FAX
1-631-943-9807/1-631-991-1665/CELLS
jason@cmbank.net
www.cmbank.net |
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jillstatz
283 Posts |
Posted - 03/27/2008 : 6:33:06 PM
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| I only list the cars if there is a loan on them and they are actually worth more than what is owed at that point which isn't very often. |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 6:34:23 PM
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I should start tel;ing the brokers that if they list cars, we require an appraisal on that as well. |
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celloshred
1376 Posts |
Posted - 03/27/2008 : 6:37:47 PM
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dave kendall had me list meth as assets when we were refinance a SFR with a lab for a basement.
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jillstatz
283 Posts |
Posted - 03/27/2008 : 6:38:02 PM
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lol...then when car loans go to h*ll and have a high repo rate they can blame that on the mortgage brokers too!!!
quote:
Originally posted by CoralSnake
I should start tel;ing the brokers that if they list cars, we require an appraisal on that as well.
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rtrefflich
1777 Posts |
Posted - 03/27/2008 : 6:39:59 PM
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| My first broker had me put cars, furniture, art they didn't have, always a cash value insurance policy (because they will never ask for it) and anything else you can put on there to show that the guy is not insolvent. |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 6:41:00 PM
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quote:
Originally posted by rtrefflich
My first broker had me put cars, furniture, art they didn't have, always a cash value insurance policy (because they will never ask for it) and anything else you can put on there to show that the guy is not insolvent.
A cash value insurance policy can be used for real assets. |
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directlending2u
436 Posts |
Posted - 03/27/2008 : 6:41:18 PM
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you put it on the 1003 to prove credit worthiness,
and yes i always put it in there and also household assets of 50k |
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ppulatie
1803 Posts |
Posted - 03/27/2008 : 6:41:27 PM
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There is actually a very good reason for listing the cars. Back in the mid 90's, underwriters would look at the ages of the cars. If a person had two cars, each getting older, then the underwriter would consider that one car would have to be replaced soon and actually factored that into the underwriting decision.
It may become a factor again. |
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rtrefflich
1777 Posts |
Posted - 03/27/2008 : 6:42:45 PM
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I know that now, but since "no one would ever check, just add it in there"
quote:
Originally posted by CoralSnake
quote:
Originally posted by rtrefflich
My first broker had me put cars, furniture, art they didn't have, always a cash value insurance policy (because they will never ask for it) and anything else you can put on there to show that the guy is not insolvent.
A cash value insurance policy can be used for real assets.
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 6:44:11 PM
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quote:
Originally posted by rtrefflich
I know that now, but since "no one would ever check, just add it in there"
quote:
Originally posted by CoralSnake
quote:
Originally posted by rtrefflich
My first broker had me put cars, furniture, art they didn't have, always a cash value insurance policy (because they will never ask for it) and anything else you can put on there to show that the guy is not insolvent.
A cash value insurance policy can be used for real assets.
Yes, but when doing a full asset loan, doesnt the UW ever ask for the statement to verify this asset?
Or do you only do SISAs? |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 6:46:24 PM
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quote:
Originally posted by ppulatie
There is actually a very good reason for listing the cars. Back in the mid 90's, underwriters would look at the ages of the cars. If a person had two cars, each getting older, then the underwriter would consider that one car would have to be replaced soon and actually factored that into the underwriting decision.
It may become a factor again.
Now this makes sense.
Thanks Patrick.
But again, did you ever have to verify the make/model/year of the car?
Or is this what eventually led to the Stated/Stated loan?
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neo-logic
381 Posts |
Posted - 03/27/2008 : 6:55:58 PM
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One time I put down a borrower's Lamborghini as an asset and it is.
Then another time, I was going down the list for borrower asking bank accounts, 401k, savings, life insurance, which they person didn't have any. So I started to ask car, expensive coats, jewelry.
Next week her house got robbed and she reported me to the police as a person of interest. LOLLLLLLL |
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rtrefflich
1777 Posts |
Posted - 03/27/2008 : 6:57:16 PM
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I've done a lot of full doc and stated loans and if they don't need the insurance to qualify the UW doesn't ask me for it. I've had a few times when they need to see it, but I have learned since being in the business not to put anything down they don't have. Just saying what the guy who "taught" me would tell me.
quote:
Originally posted by CoralSnake
quote:
Originally posted by rtrefflich
I know that now, but since "no one would ever check, just add it in there"
quote:
Originally posted by CoralSnake
quote:
Originally posted by rtrefflich
My first broker had me put cars, furniture, art they didn't have, always a cash value insurance policy (because they will never ask for it) and anything else you can put on there to show that the guy is not insolvent.
A cash value insurance policy can be used for real assets.
Yes, but when doing a full asset loan, doesnt the UW ever ask for the statement to verify this asset?
Or do you only do SISAs?
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racerx
10225 Posts |
Posted - 03/27/2008 : 6:57:39 PM
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| I think it's an old school thing. I processed for a loan officer that had been in the industry since the 70's. She always listed cars, boats, personal property, etc. |
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MortgageBoarder
2133 Posts |
Posted - 03/27/2008 : 7:00:17 PM
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I think it helps a lot with loans that are going to be manually underwritten.. ie; Refer FHA loan has to be manually underwritten. If the borrower has weak credit but can show he has 3 cars all paid off, that at least demonstrates that he has the ability to fulfil a financial obligation which could stray the underwriter's influence on approval vs. denial?
quote:
Originally posted by racerx
I think it's an old school thing. I processed for a loan officer that had been in the industry since the 70's. She always listed cars, boats, personal property, etc.
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Quicksilver
4267 Posts |
Posted - 03/27/2008 : 7:00:54 PM
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| I have on some deals, where maybe other assets weren't strong (liquidity) yet they owned cars free and clear and could prove title and value. I had one through DO that gave me an EA1 once and added in two vehicles bought in cash, gave me an approved/eligible, go figure lol |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 7:06:38 PM
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| The next question is- has anyone ever had to verify the ownership or existence of said free-and-clear vehicle? |
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Chris Clark
5861 Posts |
Posted - 03/27/2008 : 7:08:14 PM
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| it's all about the "net worth" of the individual. you list ALL of their assets to counter their liabilities to give them a higher net worth. automated underwriting does in fact take it into consideration and like chris cheney said, sometimes it'll bump you into an approval... |
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racerx
10225 Posts |
Posted - 03/27/2008 : 7:10:17 PM
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quote:
Originally posted by CoralSnake
The next question is- has anyone ever had to verify the ownership or existence of said free-and-clear vehicle?
Only once when the person was selling the car to get money for their downpayment. Had to prove they owned the car, Blue book on the car, bill of sale, etc.
If you have a lease that is about to expire and you don't want the payment to be factored in, you may get away with it if you prove that the borrower owns another car. |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 7:10:57 PM
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Can I state "Safe Deposit Box- $550,000" |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 7:12:28 PM
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quote:
Originally posted by racerx
quote:
Originally posted by CoralSnake
The next question is- has anyone ever had to verify the ownership or existence of said free-and-clear vehicle?
Only once when the person was selling the car to get money for their downpayment. Had to prove they owned the car, Blue book on the car, bill of sale, etc.
If you have a lease that is about to expire and you don't want the payment to be factored in, you may get away with it if you prove that the borrower owns another car.
But then again, they owned another car until now, and opted to lease... |
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Chris Clark
5861 Posts |
Posted - 03/27/2008 : 7:14:18 PM
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quote:
Originally posted by CoralSnake
Can I state "Safe Deposit Box- $550,000"
what kind of idiot would keep a half million in a safe deposit box!? fdic insurance on those is $0. at least if you're married you get fdic of $200k on your joint checking account... |
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homebroker@sbcgl
1513 Posts |
Posted - 03/27/2008 : 7:14:44 PM
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nope, go ahead the list the 2008 Ferrari
quote:
Originally posted by CoralSnake
The next question is- has anyone ever had to verify the ownership or existence of said free-and-clear vehicle?
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ppulatie
1803 Posts |
Posted - 03/27/2008 : 7:30:36 PM
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quote:
Originally posted by CoralSnake
quote:
Originally posted by ppulatie
There is actually a very good reason for listing the cars. Back in the mid 90's, underwriters would look at the ages of the cars. If a person had two cars, each getting older, then the underwriter would consider that one car would have to be replaced soon and actually factored that into the underwriting decision.
It may become a factor again.
Now this makes sense.
Thanks Patrick.
But again, did you ever have to verify the make/model/year of the car?
Or is this what eventually led to the Stated/Stated loan?
Never did have to verify the cars. It was taken for granted that anyone who put old cars on the 1003 was not fudging. |
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Quicksilver
4267 Posts |
Posted - 03/27/2008 : 7:37:22 PM
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quote:
Originally posted by CoralSnake
The next question is- has anyone ever had to verify the ownership or existence of said free-and-clear vehicle?
. I did list vehicles on an FHA loan in right now as well, as owned free and clear and their assets were tight so since there were some exceptions, anything helps. I had to show title in hand, think that was the only condition for that. |
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racerx
10225 Posts |
Posted - 03/27/2008 : 7:37:40 PM
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Did you wise up and start stating newer cars? You know, bump the year.
quote:
Originally posted by ppulatie
quote:
Originally posted by CoralSnake
quote:
Originally posted by ppulatie
There is actually a very good reason for listing the cars. Back in the mid 90's, underwriters would look at the ages of the cars. If a person had two cars, each getting older, then the underwriter would consider that one car would have to be replaced soon and actually factored that into the underwriting decision.
It may become a factor again.
Now this makes sense.
Thanks Patrick.
But again, did you ever have to verify the make/model/year of the car?
Or is this what eventually led to the Stated/Stated loan?
Never did have to verify the cars. It was taken for granted that anyone who put old cars on the 1003 was not fudging.
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808
1212 Posts |
Posted - 03/27/2008 : 7:43:18 PM
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quote:
Originally posted by Chris Clark
quote:
Originally posted by CoralSnake
Can I state "Safe Deposit Box- $550,000"
what kind of idiot would keep a half million in a safe deposit box!? fdic insurance on those is $0. at least if you're married you get fdic of $200k on your joint checking account...
the kind of idiot who obtained it illegally. Heard of the asset forfeiture act. |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 7:44:26 PM
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quote:
Originally posted by Chris Clark
quote:
Originally posted by CoralSnake
Can I state "Safe Deposit Box- $550,000"
what kind of idiot would keep a half million in a safe deposit box!? fdic insurance on those is $0. at least if you're married you get fdic of $200k on your joint checking account...
Are you being serious?
You cant just deposit $100,000 in the bank without anyone questioning it.
There is a certain group of people whom I have met, that have this kind of $ on hand (in ca$h), keep almost nothing in the bank.
Some in safes I guess.
These are the borrower that need the SISA loans- and they actually make/have the money stated. |
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ppulatie
1803 Posts |
Posted - 03/27/2008 : 7:51:09 PM
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No Jen, Never did. :-)
One thing people forget is that we are telling the life story of the borrower using a 1003, credit and income docs. That is all the underwriter has to go on to make a decision.
The old time underwriters were capable of looking at a file and quickly understanding how the person lived. Heck, today we can all do the same thing. So everything helps with the 1003.
I alway look around the home, the living room, den and dining room. Looking at the furniture and any art work, plus any jewelry that the wife is wearing gives me a very good idea of how to represent the borrower on the 1003. I will actually use this information in a LOE describing the loan to the underwriter so it all makes sense.
I did that just today with one borrower. He is buying a home for 3.3m and putting 25% down. He has cash for the down and 12 months reserves left. He owns 13 other properties, most fully paid for. His income taxes show a loss each year. But he puts $200k a month into bank accounts.
B of A turned him down for the loan. DTI of 62%. They went no further analysis on it, so he came to me. I looked at his Schedule E and saw that each year, he dumps 100's of thousands into a different property for upgrading, rv parks, mobile home parks, appartments. I showed all his vehicle assets and personal property, all paid off. A letter to the underwriter with documentation showing he does everything cash, living frugally otherwise, and just a wise property owner.
As a result, the underwriter knew how to take this loan and present it to her superiors for approval, which we should have tomorrow.
It is all telling a story, just like with FHA.
Now, how many people were ever trained to do this?
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ppulatie
1803 Posts |
Posted - 03/27/2008 : 7:56:15 PM
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| And racerx.....I am still waiting for that pin-up of you. Drooling just thinking about it. |
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FLMike
465 Posts |
Posted - 03/27/2008 : 8:16:55 PM
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quote:
Originally posted by CoralSnake
Every now and again, a broker sends me a 1003 and I see listed under assets a car, a boat, and other weird things as assets.
Now I do know there is a section for this.
But in the arena of residential mortgages, what lender in the world cares if the guy has a 2001 Toyota Corolla worth $6000?
Do any of you guys do this and why?
Always, list every asset and expense, it shows the total net worth. You have the same responsibility listing the borrower’s expenses and real estate owned as well. |
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Chris Clark
5861 Posts |
Posted - 03/27/2008 : 8:20:26 PM
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quote:
Originally posted by CoralSnake
quote:
Originally posted by Chris Clark
quote:
Originally posted by CoralSnake
Can I state "Safe Deposit Box- $550,000"
what kind of idiot would keep a half million in a safe deposit box!? fdic insurance on those is $0. at least if you're married you get fdic of $200k on your joint checking account...
Are you being serious?
You cant just deposit $100,000 in the bank without anyone questioning it.
There is a certain group of people whom I have met, that have this kind of $ on hand (in ca$h), keep almost nothing in the bank.
Some in safes I guess.
These are the borrower that need the SISA loans- and they actually make/have the money stated.
Sorry, I forgot about the people who don't think they should pay taxes like the rest of us... |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:23:14 PM
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quote:
Originally posted by Chris Clark
quote:
Originally posted by CoralSnake
quote:
Originally posted by Chris Clark
quote:
Originally posted by CoralSnake
Can I state "Safe Deposit Box- $550,000"
what kind of idiot would keep a half million in a safe deposit box!? fdic insurance on those is $0. at least if you're married you get fdic of $200k on your joint checking account...
Are you being serious?
You cant just deposit $100,000 in the bank without anyone questioning it.
There is a certain group of people whom I have met, that have this kind of $ on hand (in ca$h), keep almost nothing in the bank.
Some in safes I guess.
These are the borrower that need the SISA loans- and they actually make/have the money stated.
Sorry, I forgot about the people who don't think they should pay taxes like the rest of us...
Exactly. |
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R. Grant
18 Posts |
Posted - 03/27/2008 : 8:30:18 PM
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quote:
[i]
Now, how many people were ever trained to do this?
it doesn't take training to check a self employed borrower's schedule e. it should be common with any loan officer that at least holds a license. |
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ppulatie
1803 Posts |
Posted - 03/27/2008 : 8:36:20 PM
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quote:
Originally posted by R. Grant
quote:
[i]
Now, how many people were ever trained to do this?
it doesn't take training to check a self employed borrower's schedule e. it should be common with any loan officer that at least holds a license.
But the fact is that most lo's do not know how to compute back into income certain things, not to check all the schedules. Nor are they taught to do a cover letter for their files, explaining things in a rational manner. Most lo's were given a desk and told to get to work. Only a few companies ever trained, and that training was minimal at best.
Just getting a license does not mean you are competent to perform.
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:46:48 PM
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What if my borrower has an expensive dog?
Do I list that?
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:47:28 PM
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| What about a horse? |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:48:02 PM
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What if he has a great baseball card collection?
Do I itemize? |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:48:40 PM
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| "Honus Wagner- $2,350,000" |
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irishstu7975
223 Posts |
Posted - 03/27/2008 : 8:50:24 PM
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| i love this post |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:52:05 PM
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| "Babe Ruth Rookie- $200,000" |
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racerx
10225 Posts |
Posted - 03/27/2008 : 8:54:23 PM
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| What about your wife? She's considered personal property, right? |
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Quicksilver
4267 Posts |
Posted - 03/27/2008 : 8:54:54 PM
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| Kinda off topic, but way back in hs, I worked at mbna for a shortwhile (quit after 4 months but pry made 4-5X's what anybody else made in hs at jobs at that age lol). I remember one person saying they made 100K a year, for job they said sells drugs, and I'm not sh!tting you mbna actually issued him a credit card LOL. |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:55:18 PM
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| "Wife- Priceless..." |
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privatecash
1294 Posts |
Posted - 03/27/2008 : 8:57:12 PM
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We had a borrower about a year ago, $10M house, only $5M in debt, in F/C so filed Ch. 11.
Had $300K in cars, $600K in jewelry and $700K in art on the 1003. $1M in retirement account.
Judge granted the Relief From Stay, lender foreclosed and evicted him.
He emailed me 2 weeks ago....now living in a Days' Inn. True story. |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 8:59:45 PM
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| "Original GI Joe with Kung Foo Grip- $500" |
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CoralSnake
9153 Posts |
Posted - 03/27/2008 : 9:00:57 PM
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| "P0rn Collection- $14,000" |
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