No. of Recommendations: 1

You wrote, Typically borrowers might pay an extra 1/8th to 1/4 point to use stated income.

Do you have stats for that? Or is it just an opinion?

My last mortgage was a stated income loan. My average credit score was 796. I offered to document my income. I used an independent mortgage broker who I'm pretty sure got me the best rate then available on the market (4.875% APR). I'm pretty darn sure he would have told me if income documentation would have made a difference in my rate; but he insisted that with my score, no lender would care.

In fact, I wouldn't be surprised to find that MOST mortgages to top-tier (high FICO score) customers are actually no-doc loans. It makes sense really. If the borrower's score is really that great (especially if they have some equity in the property), they're likely not lying to you about their income. And if you can say that with a high degree of statistical probability, I imagine it saves the lenders money to NOT verify incomes for these people.

- Joel
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