Is this fair ???

Banks continue to offer the best rates only to candidates with the strongest credentials. Prospective borrowers who are self-employed or who receive a large portion of their income through commissions and bonuses meet with resistance even if they have high incomes and solid credit scores.

One mortgage broker told me with 50 percent down I could get a loan, but my rate would be brutal,said Shannon Aalai, a senior associate at Citi Habitats, who is self-employed and has zero debt, as well as a credit score of 790 and more than $100,000 saved for a down payment. the people that did everything right that are being punished for this. We werent involved in the subprime mortgage crisis.

Would YOU loan hundreds of thousands of dollars at a low rate to someone who works on 100% commission in the real estate industry?

real estate brokers had nothing to do with the mortgage crisis? I beg to differ! how would we have a mortgage crisis if there was no real estate bubble? anyway we reap what we sow

Many of the HIGH end apts are purchased thru bonuses and high commission especially thru the WALL ST brokers.

I was confused reading this article, because it appeared she was shopping for apts in the high 600's with 100k down and wondering why she wouldn't be approved.

Why would a person bringing 50% down with excellent credit be butt screwed by the bank ?

Credit is a negative factor not a positive one. No one pays their bills with credit.

It's very possible the bank in question saw the applicant's income stream was so hard to prove that it could only be a no-doc loan.

What job is totally secure nowadays ? More money you put down, the less you borrow, less risk for banks.

I was financing 2 years ago with 75% down and an average credit score of 798.
My corporations' 2 years of statements weren't the prettiest, and understandably so for the post Lehman world but the mortgage and maintenance expenses still met the required ratio.

It was also this time 2 years ago so the bank decided last minute to ask for the coming year's corporate financials in addition.
I finally told them to go scratch and I'll pay the whole amount cash to which they said , "OK" and accepted my mortgage.

They are not used to "not being needed." They are very arrogant and deserve the ire and vitriol thrown their way the last 5 years. They have a guaranteed formula to succeed in business that most of us do not and yet, still manage to fail, only to get mulligans to try try again.

When I was first in business 25 years ago and needed to borrow money, the bank always had it's foot on my throat and I hated them. A decade later and for many years after when they would lend me my own money back they were the greatest friend, the sweetest, and fall over backwards helpful for anything I needed or didnt need.

The last 5 years is a stark reminder of the true nature of SH#t that they are, and any chance someone has to legally F them, they should.

And as Ive substancially rebounded I will never forget this lesson the rest of my life.

And I really don't what on Earth is wrong with my fellow citizens.
Dodd-Frank is no Glass-Steagall.
Every congressman who voted against reinstating Glass-Steagall should have lost their seat, whatever side of the aisle they're on.
Shame on you Americans.

>Credit is a negative factor not a positive one. No one pays their bills with credit

Pier45....really?
Credit tells you how serious and capable someone is about paying what they owe.
(Even how much they care about what they owe)

If you were in business or ever lent money, not someone else's money but your own, you'd understand credit is one of the most important things.

See if you lent money to client A who has $500K cash in the bank and a credit score of 550 vs client B who has $50K cash in bank but a credit score of 800, I'd bet you my $1,000 to your $100 by the end of the loan you would have been happier with client B's payment history.
And the very most important thing about lending money is on time payments.

Truth thanks for the lecture but it's a negative factor because your score can't help you but can hurt you. You are expected to have excellent credit. This is not sufficient to prove likeliness to repay a mortgage.

test

hey SE--why cant i post on the "successful lowballs" thread?

pls answer lest i cancel my acct.

@Pier45 ... Like the example that i posted earlier.How can a person who puts 50% and great credit get SCREWED over on loan rate because of their income stream ? I know BANKERS right now that don't know if their dept is gone by the beginning of the year and that never happened.

MIB putting more down decreases the chances that you will give up and walk away if things go badly later. The rate was likely adjusted down to reflect that. But apparently not enough to off-set the riskiness of lending to someone without steady income.

Not sure what lack of security for your banker's depts has to do with the calculated riskiness of your loan. They are not the ones trying to get a loan, you are.

FYI, most loans are packaged and sold shortly after they are written. The bank is in it for the transaction fees. However, they need to make sure they can SELL the loan afterwards. And investors don't particularly care for loans where the borrower's income is considered uncertain or volatile.

Out of the four loans that I've had over the last twenty years none on them have been sold. And three have been conforming. Banks are crazy right now, and their underwriting departments have no ability to read a k-1 or do any actual underwriting. Underwriting should involve looking at a number of risk factors and making a rational decision. Just because they fucked up so badly in the 1998-2007ish period doesn't justify their inability to do a damn thing right in the process now. We had three banks claim that my husband owned 27 % of one of the world's largest law firms. For one bank we were asked to provide a letter FOUR times affirming that he didn't. One bank would only allow 20% of his partnership payments as income, despite his firm having little to no debt, his income having been very consistent, and the fact that law firms are generally (with a few notable exceptions) conservative as hell.

Only one of those four loans have involved more than 10% down.

I'm on 100% commissions and received a good rate on a 30 year fixed 9 months ago. I am also a real estate broker for those who don't know.

Keith Burkhardt

>Out of the four loans that I've had over the last twenty years none on them have been sold.

Well those are bragging rights if I ever heard of them!

>We had three banks claim that my husband owned 27 % of one of the world's largest law firms.

Ca'ching!

Keith, what percent did you put down?

At the end of the day we actually got a decent rate on a 30 year fixed with 10% down and no PMI through private banking. Our loan was not much greater than a half of a year's income, and we had almost zero debt. But the process was horrific, And I'm used to having to go through the PMI hurdles.

AR: We put down 20%, no debt 780 FICO. I should have added that the process was hell, especially since I am self-employed and on 100% commissions. Some advice: make sure you are working with a very knowledgeable mortgage broker/banker. Don't just walk into/call your bank and tell them you need to speak with someone about a mortgage!!

I will add that it seems that our clients are having little problem getting their financing arranged. I have not heard many complaints either. There have been one or two exceptions, this was due to some credit glitches. If there are any irregularities on your credit report or employment history prepare to be dragged through hell!!

Keith Burkhardt
The Burkhardt Group

>At the end of the day we actually got a decent rate on a 30 year fixed with 10% down

Why so much leverage?

I really appreciate the comments and thoughts on this thread. KeithB.. im a person basically in your position. Iam looking at a 2mil condo and looking to put 800k down. Hard to think anyone would give me a hard time but it seems maybe i could be wrong :/

FICO is an "all purpose" credit score but all lenders have their OWN proprietary score which history has shown to be more accurate than FICO for their portfolio. So that's the score you are being gauged on. A lot of lenders blame FICO for extent of 2009 & 2010 losses. Sometimes FICO is an input to the prop score. Self-employed is, in aggregate, risky in all portfolios. That's just a fact.