Bob V-G said:

“No conventional Lenders will fund your loan without a 4506-t being executed.  Try Private money.”

Ok.  Let me ask a more specific question.  Are there lenders that will execute the 4506-T with just box 8 checked.  That is, if I provide a W2 to qualify on (and the lender agrees that that income is sufficient to qualify for the loan), will a lender (conventional (or local bank if it is not considered conventional) just seek to verify the W2 by requesting only box 8 of the 4506-T?  Scott and Mike King (earlier in this thread) indicated that there are lenders that will do that, but didn’t name them.  Or, in your experience does every lender (conventional or local bank) require that tax transcripts be requested (box 6(a)).  You can look at a 4506-T form on the IRS website.  

Akaagassi said:

“[you're just about as much of a trip as that shady broker from BO that openly talked about adding YSP a day before closing on people]”

C’mon.  Isn’t this discussion more interesting than an umpteenth discussion of the direction of interest rates? : - )

Paul Smith:

Isn’t this discussion more interesting than an umpteenth discussion of the direction of interest rates? : - )

Not really. 

Paul,

I didn't see anything from the other Scott that said he knew anything about only checking box 8 but maybe i missed it.  So far I've only seen Mike say that he knows of any lenders who do this, and that was from a class he had just taken.  The common procedure for lenders is to ask for one of the boxes to be checked under line 6.

You say you want a fruitful discussion, but debating about why you should/shouldn't have to fill the form out a certain way is not what we're here for, we're just letting you know that we don't know of any lenders who will do this.  This thread has been going for 3 weeks and I've only seen one professional say they might know of a way to get this done in the manner you'd prefer.  I would suggest emailing Mike K directly to get your answer.

There are no conventional Lenders that will fund your loan with just Box 8 checked.  We done yet?

Hi, I found this thread while researching the 4506T requirements.  I've provide income, W2s a nd tax returns for two years...no problem.  Now at the last minute the funding agency is requiring a THIRD year on the 4506T saying that it is now Fannie Mae requirements.  Well, I signed - nothing to hide...two days later no results on the 4506T    So now that Congress colluded with Fannie Mae to promote subprime mortgages, the pendulum has swung far to the right...we are beholden to the IRS as final sign off on our mortgages? Certainly us honest folks are paying the price. But my question is at the 11th hr the IRS can't complete the form for all three years?  What's up with that?  What can I do?

Frustrated and baffled borrower

Dear Frustrated,

First of all, welcome to our WORLD - we are all frustrated too!  That said, the 4506-T is normally executed right away at time of loan submission.  So either your loan was only just recently submitted, or it was "re-submitted" for various reasons - who knows what, and your original signature was over 90 days ago on the 4506T that you executed.  We've had that come up, for deals that take forever to close from the initial prequal.  If the 4506T is going to continue to show consistent income, you have nothing to worry about, other than having your closing date get delayed. 

So yes, we are beholden to the government for everything these days it would seem.  This apparently is the "change" that America voted for.  Except me, I voted for the old guy and the soccer mom.

[quote)Now at the last minute the funding agency is requiring a THIRD year on the 4506T saying that it is now Fannie Mae requirements.  Well, I signed - nothing to hide...two days later no results on the 4506T    So now that Congress colluded with Fannie Mae to promote subprime mortgages, the pendulum has swung far to the right...we are beholden to the IRS as final sign off on our mortgages? Certainly us honest folks are paying the price. But my question is at the 11th hr the IRS can't complete the form for all three years?  What's up with that?  What can I do?

 The IRS does not complete the 4506-t.  It is your responsibility as a tax paying citizen to complete.  Your Broker/LO can not complete the new request.  A new form must be delivered to the Lender with all required years completed.

Crazy?  Absolutely.   We have congress dictating to an industry that they, by and large, have no knowledge.  It will get worse before it gets better.  Even the cream of the crop borrowers are subjected to unnecessary and unwarranted conditions and requests.  Quite simply:

                                                                      LENDERS ARE AFRAID TO LEND

Thanks Curt.  Actually I was Preapproved for a 5% conventional.  I then opted for the MassHousing MYCommunity loan to leverage the 97% LTV program.  What a mistake!  MassHousing REVALIATED everything MetLife had processed and approved.  I'm good to go as far as MetLife is concerne.  The 2 year 4506T came back squeaky clean.  Then during the course of my 5 week loan processing supposedly Fannie Mae changed the rules and now requires a 3 year 4506T.  So I signed another and we all though it would slip right on through.  I've not misstated any income - application is true and honest.  Its been three days now since the secon 4506T has been submitted.  We've extended now three times.  If it doesn't come back, I guess the loan cannot be funded.  In that case do I get my $10K deposit from the P&S back?  I too voted for the same folks, but this new fella and his ilk are out to destroy middle America.  I'm ready to completely walk away from the entire mortgage deal an just go rent a luxury condo.  There are plenty on the market at great prices!  Then save over the next year for the coveted 20% and give the good old boys the raspberries! 

Sorry, but I’m not sure where you’re coming from here…I cannot cmplete the form, I merely sign it, it then goes to a vendor who processes with IRS.  IRS has all the infrmation an is the one that completes the form.  The 4506T requests a transcript of 1040 tax returns.  The only people that can fill provide the transcript is the IRS.   I can't do any of this.

I've signed TWO 4506T forms. The first 4506T was signed and sent off to the service vendor that processes the forms 4weeks ago when the loan was being underwritten.  Everything was okay.  Now it seems that Fannie Mae adopted new rules as of October 1 2009 - namely THREE years are now required on the 4506T not just two as originally obtained.  So here we are the night before closing and loan processor emails saying they need another for 2006 tax year.  I signed the second; it was submitted to the vendor.  THREE days and two closing extensions later and NO completed 4506T from vendor.  My issue is with IRS – they clearly are unable to dredge up my information and confirm my tax filing for 2006.  What does that do to my loan and if the loan does not fund do I get my $10,000 deposit back?

If the purchase agreement stated that you would receive your earnest money back in case the finances fell through than you should be covered. 

most purchase contracts will allow you to get earnest money refunded for getting declined on the loan.  But I'm not an attorney, so ask your realtor or attorney what your contract really says.

I just joined the forum today and am very impressed with the knowledge on this thread. I've been in the business for 23 years and really enjoy the great advice given on this subject...moreso the ethical conduct I pickup from the contributors.

My comment is if there is something on the tax return that is questionable, pass on the loan. Curt hit the nail on the head in one of his comments...one file is not worth the pain down the road if the loan gets sold or has a buy back...and I am seeing nutty questions coming back after post closing reviews on files that we all would kill for, yet underwriters and quality control people are looking at files in ways I have not see in over 15 years. If it is just the issue of e-file go to the local IRS office and ask for a confirmation on your filing....that should be simple.

I have a file where the borrower is just now filing his returns for 2008 and the underwriter was very concerned that he was filing late (Oct 15th. is now late). The underwriter wanted an LOE on why (she's obvioulsy not self employed and never has been). Her commentary was to have the borrower go directly to the local IRS office and file the return and get a receipt of filing...probably for the same reason due to the 4506...who knows

Also there was a question about putting it in writing that the file will never be sold or serving transfered...I can't imagine anyone doing that in todays environment...what if there is value to the bank in selling a serving portfolio, what if the bank gets taken over, what if the bank is sold or merged, what if there is a change in management...

I've done some pretty amazing things to accomodate clients, but I've also passed up a lot of good business trying to close "the impossible file". Sounds like this is a good file but there are just some things that can't be done...in todays environment this may be one of them.