Stated Income: Out of the Fat into the Fire

Fire In my August 13th post, I defended ‘stated income’ as a legitimate tool in making a loan. In this post, let me be sure I have been crystal clear:

Telling the borrower what to put down for stated income, or even knowing that they are lying, can put you right in the hot seat when it comes to fraud.

Check out the article Truth or Consequence: Brokers, beware: Overstating income on stated-income loans is fraudulent by C. Robert Simpson, CEO and senior legal counsel of Investors Mortgage Asset Recovery Co. LLC (IMARC). Simpson says “If a loan officer knows a borrower’s true income and purposely misstates it, is it fraud? Simply put, the answer is yes.”

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Linda Keith

Linda Keith is an expert in credit risk readiness and credit analysis training. She trains financial institutions throughout the United States on both Tax Return and Financial Statement Analysis.
She is in the trenches with lenders, analysts and underwriters helping them say "yes" to good loans.
She moved her in person training online in 2008 to www.LendersOnlineTraining.com with a continued focus on lending to businesses, farm operations and complex individual borrowers.