Apparently A Broker Can Do 90% Jumbo SISA...

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Agent_Mike

375 Posts

Posted - 07/09/2008 : 4:47:49 PM

Earlier this week, I spoke with a client who came to me. The scenario is as following:

10% down/ 90% purchase loan
Jumbo loan amount ($450,000)
declining market
700 FICO
Self-employed - SISA
Owner Occupied
Tax gross = $40,000

I told them to my knowledge, they cannot do this. They called me today, told me a broker found a bank that will do it. Quoted them 30 years fixed at 6.625% one loan with PMI - one point. Said the bank was Wells Fargo.

I checked my Wells Fargo sheets - nothing. I called my guy on retail WF - they do not do this.

The client is proceeding to make an offer on this loan ...

mantixmortgage

2717 Posts

Posted - 07/09/2008 : 4:49:12 PM

sit back and watch the fireworks

Captain Mortgage

1745 Posts

Posted - 07/09/2008 : 4:54:25 PM

I saw Wells do a SISA 85% loan at 417k. Closed about 3 weeks ago. Not sure about the jumbo L/A though

Edit: The doc type according to the approval they sent me was not SISA, it was "Straight to Close doc type"

liverichly

3936 Posts

Posted - 07/09/2008 : 4:57:28 PM

Inform the client they are committing fraud by overstating their income.

Agent_Mike

375 Posts

Posted - 07/09/2008 : 4:59:06 PM

quote:
Originally posted by Captain Mortgage

I saw Wells do a SISA 85% loan at 417k. Closed about 3 weeks ago. Not sure about the jumbo L/A though

Edit: The doc type according to the approval they sent me was not SISA, it was "Straight to Close doc type"

Would you happen to know:

-If their county was declining market?
-It was authentic SISA or DO/LP full doc with SISA findings?

mantixmortgage

2717 Posts

Posted - 07/09/2008 : 5:00:32 PM

quote:
Originally posted by liverichly

Inform the client they are committing fraud by overstating their income.

classic broker outpost response

Agent_Mike

375 Posts

Posted - 07/09/2008 : 5:02:07 PM

quote:
Originally posted by mantixmortgage

sit back and watch the fireworks

Yes .. but if it's doable, I should know about it too. I hope I'm wrong and they get this loan done. At least I would find out if it's doable.

Otherwise, why the hell would the broker even try to switch & bait these clients? No bank out there will even do SISA at 90% jumbo for them to switch & bait to .. so they're just wasting their time if they don't have a real product lined up.

They also see the funds of the borrower and know they don't have any more money outside of 10% down so coming with final docs saying you must put down 20-25% is just plain stupid.

God I hope I'm wrong.

liverichly

3936 Posts

Posted - 07/09/2008 : 5:02:45 PM

quote:
Originally posted by mantixmortgage

quote:
Originally posted by liverichly

Inform the client they are committing fraud by overstating their income.

classic broker outpost response

Thank you, thank you very much. ::: tips hat :::

liverichly

3936 Posts

Posted - 07/09/2008 : 5:04:13 PM

quote:
Originally posted by Agent_Mike

Otherwise, why the hell would the broker even try to switch & bait these clients? No bank out there will even do SISA at 90% jumbo for them to switch & bait to .. so they're just wasting their time if they don't have a real product lined up.

Perhaps the LO's employment is borderline and he's trying to make himself look good to his boss and buy enough time so he can get a real loan... people do anything for the strangest reasons.

Agent_Mike

375 Posts

Posted - 07/09/2008 : 5:10:31 PM

quote:
Originally posted by liverichly

quote:
Originally posted by Agent_Mike

Otherwise, why the hell would the broker even try to switch & bait these clients? No bank out there will even do SISA at 90% jumbo for them to switch & bait to .. so they're just wasting their time if they don't have a real product lined up.

Perhaps the LO's employment is borderline and he's trying to make himself look good to his boss and buy enough time so he can get a real loan... people do anything for the strangest reasons.

The funniest bit - the client showed me their "approval" - it's a typed up letter by an LO which is a pre-qual but they used strong rhetorics like "approval letter."

Be that as it may, the clients are putting down a considerable amount for deposit. The realtor spent all the time and gas showing them properties. Even a stupid LO must know that a purchase isn't something that they can just switch and bait without being able to really do it - or else the client might lose deposit after loan contingency is removed.

Sigh ... let's see how it goes. I'll keep you guys updated. Maybe if you know any way this can be done, you'll let me know ..

Captain Mortgage

1745 Posts

Posted - 07/09/2008 : 5:10:51 PM

quote:
Originally posted by Agent_Mike

quote:
Originally posted by Captain Mortgage

I saw Wells do a SISA 85% loan at 417k. Closed about 3 weeks ago. Not sure about the jumbo L/A though

Edit: The doc type according to the approval they sent me was not SISA, it was "Straight to Close doc type"

Would you happen to know:

-If their county was declining market?
-It was authentic SISA or DO/LP full doc with SISA findings?

Yes it was a declining market. The loan was approved prior to the restrictions being lifted in California.

I did not see any DU/LP findings. They ran it through their AUS system and got an approval similar to "Go Fast", "Quick Doc" etc. They called it "Straight to close" Didn't even ask for a business license. I never thought for a minute that the loan would go through because the buyers were only self employed for 6 months. But it did fund with no problems.

EDIT: the loan it most resembled was a No-Doc loan

808

2597 Posts

Posted - 07/09/2008 : 5:24:56 PM

who's even gonna think about doing the MI on a 90% SISA Jumbo?????

Agent_Mike

375 Posts

Posted - 07/09/2008 : 5:27:45 PM

Captain morgan,

Was this your file or someone elses? Also, WF retail or wholesale handled that file? seems pretty aggressive.

slants

4274 Posts

Posted - 07/09/2008 : 5:30:28 PM

quote:
Originally posted by Agent_Mike

quote:
Originally posted by Captain Mortgage

I saw Wells do a SISA 85% loan at 417k. Closed about 3 weeks ago. Not sure about the jumbo L/A though

Edit: The doc type according to the approval they sent me was not SISA, it was "Straight to Close doc type"

Would you happen to know:

-If their county was declining market?
-It was authentic SISA or DO/LP full doc with SISA findings?

Can't get income waiver findings on S/E. Couldn't even get it @ 55% LTV w/ almost 800 ficos & 20+ years in business. They are doomed.

dukekingsbury

6 Posts

Posted - 07/09/2008 : 5:31:24 PM

Wells came back with their VOA loan ... like agent mike said... it's basically just DO/LP full doc with stated findings.... all you have to do in that case if verify assets.

Not sure about that LTV though... I don't think we could do that here in LA.

liverichly

3936 Posts

Posted - 07/09/2008 : 5:33:45 PM

quote:
Originally posted by slants

quote:
Originally posted by Agent_Mike

quote:
Originally posted by Captain Mortgage

I saw Wells do a SISA 85% loan at 417k. Closed about 3 weeks ago. Not sure about the jumbo L/A though

Edit: The doc type according to the approval they sent me was not SISA, it was "Straight to Close doc type"

Would you happen to know:

-If their county was declining market?
-It was authentic SISA or DO/LP full doc with SISA findings?
Can't get income waiver findings on S/E. Couldn't even get it @ 55% LTV w/ almost 800 ficos & 20+ years in business. They are doomed.

Actually a few months ago I got an income waiver with a SE client, 710 scores, 75% LTV, cash out, owner occupied, $150k loan amount. We didn't need the income waiver (so the client says), but it was nice I didn't have to ask him for his tax returns.

Captain Mortgage

1745 Posts

Posted - 07/09/2008 : 5:35:42 PM

This was a file that I pre-qualed for a Realtor. It was a WF Retail office. Not a banking branch, it was a WF retail loan shop. I spoke to the LO and got it confirmed with the branch manager before I told the Realtor that the loan was ok. I followed up with him every step of the way up till closing.

here's the end result 416k/490k

http://i95.photobucket.com/albums/l131/Pikerz37/wfretail.jpg

Edit: Cut and paste the link. Property in Southern Cali

slants

4274 Posts

Posted - 07/09/2008 : 5:36:10 PM

quote:
Originally posted by liverichly

quote:
Originally posted by slants

quote:
Originally posted by Agent_Mike

quote:
Originally posted by Captain Mortgage

I saw Wells do a SISA 85% loan at 417k. Closed about 3 weeks ago. Not sure about the jumbo L/A though

Edit: The doc type according to the approval they sent me was not SISA, it was "Straight to Close doc type"
Would you happen to know:

-If their county was declining market?
-It was authentic SISA or DO/LP full doc with SISA findings?
Can't get income waiver findings on S/E. Couldn't even get it @ 55% LTV w/ almost 800 ficos & 20+ years in business. They are doomed.

Actually a few months ago I got an income waiver with a SE client, 710 scores, 75% LTV, cash out, owner occupied, $150k loan amount. We didn't need the income waiver (so the client says), but it was nice I didn't have to ask him for his tax returns.

Lucky, never got one on S/E, ever. Not gonna happen w/ DU 7.0 on a 90% jumbo.

racerx

11450 Posts

Posted - 07/09/2008 : 5:37:16 PM

quote:
Originally posted by dukekingsbury

Wells came back with their VOA loan ... like agent mike said... it's basically just DO/LP full doc with stated findings.... all you have to do in that case if verify assets.

Not sure about that LTV though... I don't think we could do that here in LA.

He won't be able to get MI for 90% in a declining market...even if it is full doc. I think 85% is max.

moneyluck

3775 Posts

Posted - 07/09/2008 : 5:44:31 PM

my bet is that this is retail at 75 or 80 ltv with a combo, which as far as I know, is still available. Run findings on Wells system at that lower ltv, good chance of all the waivers, and mi issue solved. I know that on Citi's system up until they pulled the seconds, the waiver carried through to the second as well - wells the same way?

Or . . .it is just a greenhorn retail LO with no idea what is about to hit him . . .

slants

4274 Posts

Posted - 07/09/2008 : 5:50:19 PM

quote:
Originally posted by moneyluck

my bet is that this is retail at 75 or 80 ltv with a combo, which as far as I know, is still available. Run findings on Wells system at that lower ltv, good chance of all the waivers, and mi issue solved. I know that on Citi's system up until they pulled the seconds, the waiver carried through to the second as well - wells the same way?

Or . . .it is just a greenhorn retail LO with no idea what is about to hit him . . .

Worse, it's a greenhorn wholesale LO whith no idea what he's doing to the homeowner's earnest money. I don't think Wells is doing 2nds to 90% in CA, even retail.

Agent_Mike

375 Posts

Posted - 07/09/2008 : 6:01:47 PM

lol as far as I know - no one is doing 2nds to 90% in CA full doc, let alone SISA!!

As far as I know, no one will touch stated products less DU/LP SISA findings with less than 20% down payment.

As far as I know, no MI will touch a 90% SISA.

So many things that's wrong with that scenario and what they're being "APPROVED" for that it's just ... all wrong all over.

The worst part, the property is no longer TBD and they still haven't received the TIL or packets from the bank.

moneyluck

3775 Posts

Posted - 07/09/2008 : 6:05:43 PM

well then, refer to the fireworks post . . .

clearwaterny

347 Posts

Posted - 07/09/2008 : 6:28:10 PM

Well from what one of my friends who works at WF retail told me, they don't have straight to close anymore and they are pulling 4506's on all there STC loans.

ooslimm

929 Posts

Posted - 07/09/2008 : 6:30:58 PM

A friend of mine on Wells Retail just did a 600K L/A SISA 90% Purchase. They have a program that will allow you to do the 417k 1st and remaining on a HELOC, however the program calls for a 740 FICO. Perhaps the LO is unaware of this???

TH

Quicksilver

4630 Posts

Posted - 07/09/2008 : 6:46:28 PM

I don't know if WF Wholesale is still doing it, but I know on retail they were/are still closing jumbo combos, they'll do a second only if its on a purchase with WF being the 1st note holder. I tried getting them to do a second in the past with another lender in first and they wouldn't budge.

slants

4274 Posts

Posted - 07/09/2008 : 7:03:49 PM

quote:
Originally posted by ooslimm

A friend of mine on Wells Retail just did a 600K L/A SISA 90% Purchase. They have a program that will allow you to do the 417k 1st and remaining on a HELOC, however the program calls for a 740 FICO. Perhaps the LO is unaware of this???

TH

this is a wholesale broker though. Perhaps he's referring it to retail?

slants

4274 Posts

Posted - 07/09/2008 : 7:16:45 PM

quote:
Originally posted by ooslimm

A friend of mine on Wells Retail just did a 600K L/A SISA 90% Purchase. They have a program that will allow you to do the 417k 1st and remaining on a HELOC, however the program calls for a 740 FICO. Perhaps the LO is unaware of this???

TH

was this in california?

ooslimm

929 Posts

Posted - 07/09/2008 : 7:20:07 PM

It was in Portland, they still have it as I just spoke to him.

Tim

slants

4274 Posts

Posted - 07/10/2008 : 08:39:17 AM

quote:
Originally posted by slants

quote:
Originally posted by ooslimm

A friend of mine on Wells Retail just did a 600K L/A SISA 90% Purchase. They have a program that will allow you to do the 417k 1st and remaining on a HELOC, however the program calls for a 740 FICO. Perhaps the LO is unaware of this???

TH
this is a wholesale broker though. Perhaps he's referring it to retail?

I still don't buy it. Just noticed OP already confirmed it's not available retail. clearwaterny's Wells contact says they don't do STC anymore, but they are doing it in other states?

"Quoted them 30 years fixed at 6.625% one loan with PMI - one point. Said the bank was Wells Fargo.

I checked my Wells Fargo sheets - nothing. I called my guy on retail WF - they do not do this."

jamieonthegulf

121 Posts

Posted - 07/14/2008 : 2:23:19 PM

Curios...whatever happened with this deal? Thanks for the update.

jamieonthegulf

121 Posts

Posted - 07/14/2008 : 2:23:58 PM

Sorry..."Curious"

jstar

719 Posts

Posted - 07/14/2008 : 3:01:04 PM

quote:
Originally posted by Agent_Mike

lol as far as I know - no one is doing 2nds to 90% in CA full doc,

Southland Credit Union / Credit Union of Southern California

Megaloans

16 Posts

Posted - 07/14/2008 : 3:23:35 PM

With today's news on the stance of the Fed, it seems you need to be verifying income and assets. No more stated loans will pass muster, unless you can do it wih a 4506

dc62

279 Posts

Posted - 07/14/2008 : 3:25:56 PM

FWIW, it's "Bait and Switch", not "Switch and Bait". That doesn't make any sense. I'm not the grammar police, but for some reason that one was a little bothersome to me.

Agent_Mike

375 Posts

Posted - 07/14/2008 : 3:26:54 PM

Update:

The client called me and told me that the realtor called the other day - 15 days left to close.

She asks .. "hey - what happened to your income" and told them their loan is denied because she didn't realize what they were making ...

Then she calls back same day and says "oh no, it was just one of the banks that denied you .. I was having you approved with multiple banks so the other guys are still looking into it"

She is some kind of a realtor ... some work she is.

KHufford

5993 Posts

Posted - 07/14/2008 : 3:27:09 PM

quote:
Originally posted by dc62

FWIW, it's "Bait and Switch", not "Switch and Bait". That doesn't make any sense. I'm not the grammar police, but for some reason that one was a little bothersome to me.

LOL...I thought the same thing.

bestbet123

1577 Posts

Posted - 07/14/2008 : 3:28:32 PM

I am anxiuosly awaiting the outcome of this"deal"????no effen way it can be done.By the way it's bait and switch.

Agent_Mike

375 Posts

Posted - 07/14/2008 : 3:29:08 PM

Update:

The client called me and told me that the realtor called the other day - 15 days left to close.

She asks .. "hey - what happened to your income" and told them their loan is denied because she didn't realize what they were making ...

Then she calls back same day and says "oh no, it was just one of the banks that denied you .. I was having you approved with multiple banks so the other guys are still looking into it"

She is some kind of a realtor ... some work she is.

bestbet123

1577 Posts

Posted - 07/14/2008 : 3:30:18 PM

I am anxiuosly awaiting the outcome of this"deal"????no effen way it can be done.By the way it's bait and switch.

Agent_Mike

375 Posts

Posted - 07/14/2008 : 3:30:56 PM

Agent_Mike

375 Posts

Posted - 07/14/2008 : 3:32:10 PM

bestbet123

1577 Posts

Posted - 07/14/2008 : 3:37:13 PM

i can't stand lying realtors,i'm dealing with one now and he is getting the "come to jesus" meeting in a half hour i'll let you know how it goes....lol....you simply can't do that deal as it is now with wells.no way.maybe the pres. of a local bank might sign off on it,other than that you have to explain in very elementary terms to this so called realtor that it can't be done.restructure it and sell it the right way,otherwise walk away.

Megaloans

16 Posts

Posted - 07/14/2008 : 3:40:01 PM

Put your hand down. Lay down the law!!

KHufford

5993 Posts

Posted - 07/14/2008 : 3:42:13 PM

quote:
Originally posted by dc62

FWIW, it's "Bait and Switch", not "Switch and Bait". That doesn't make any sense. I'm not the grammar police, but for some reason that one was a little bothersome to me.

LOL...I thought the same thing.

Agent_Mike

375 Posts

Posted - 07/14/2008 : 3:43:05 PM

quote:
Originally posted by bestbet123

i can't stand lying realtors,i'm dealing with one now and he is getting the "come to jesus" meeting in a half hour i'll let you know how it goes....lol....you simply can't do that deal as it is now with wells.no way.maybe the pres. of a local bank might sign off on it,other than that you have to explain in very elementary terms to this so called realtor that it can't be done.restructure it and sell it the right way,otherwise walk away.

Yup - I've already checked and declined it because it cannot be done.

The client is cool with me so he keeps me posted. I will know anything he knows so if it does fund - I will sure as hell know what bank does a loan this aggressive. For his sake, I hope he gets it.

Captain Mortgage

1745 Posts

Posted - 07/14/2008 : 3:44:24 PM

quote:
Originally posted by KHufford

quote:
Originally posted by dc62

FWIW, it's "Bait and Switch", not "Switch and Bait". That doesn't make any sense. I'm not the grammar police, but for some reason that one was a little bothersome to me.

LOL...I thought the same thing.

I thought it was Wait and *****

bestbet123

1577 Posts

Posted - 07/14/2008 : 3:51:01 PM

lmfao

eryan2369

779 Posts

Posted - 07/14/2008 : 3:56:24 PM

quote:
Originally posted by liverichly

quote:
Originally posted by mantixmortgage

quote:
Originally posted by liverichly

Inform the client they are committing fraud by overstating their income.

classic broker outpost response

Thank you, thank you very much. ::: tips hat :::

I'm curious what part of the OP's description of the scenario said he was overstating income? Or are you on the bandwagon that any and all stated loans must be people overstating income?...

The fact is that just because a self employed individual does not report all his/her income to the IRS doesnt mean they didnt actually make it and therefore doesnt mean they are overstating it...it doesnt make it right that they lie to the IRS to pay lesser taxes. But it also doesnt mean they are overstating income either, just means they cant prove it cause they screwed the IRS.

So a self employed person going stated cause they took maximum deductions on tax returns to have the lowest tax liability as possible (I'll grant you) is a liar...just not neccessarily to the lender.

They said they make one thing to the IRS and another to the lender, obviously they lied to someone...to assume its always the lender is pretty nieve...its often times the IRS.

Megaloans

16 Posts

Posted - 07/14/2008 : 6:47:24 PM

If you have a 4506 and the income is not grossly overstated, I believe that is how to get around it, however after today, I would be hesistant to take on anything with the word stated

slants

4274 Posts

Posted - 07/14/2008 : 6:55:37 PM

quote:
Originally posted by Megaloans

If you have a 4506 and the income is not grossly overstated, I believe that is how to get around it, however after today, I would be hesistant to take on anything with the word stated

Isn't confumbo full doc only? Can't get to 90% w/ an income waiver. Wells Fargo wholesale max CLTV on their HELOC combo is now 80% and might even have a 5% declining market LTV cut. Doubt retail is much higher. I hope the buyer is mindful of his contingency period and cancels escrow before he loses his deposit.

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