Blog Category: mortgage rules
As many of you have heard, there are some new regulations that have gone into effect for mortgages as of January 10, 2014. There are two basic components of the regulation, one is the ability to repay and the other is the qualified mortgage. While they seem complicated and onerous, the reality is that not much will change in the way most mortgage lenders do business.
Unreimbursed Business Expenses (UBE) is one of the newest issues to trip people up on mortgage applications. Fannie Mae and Freddie Mac have really cracked down on enforcing that lenders deduct any UBE from a mortgage borrower’s income. UBE are expenses that an employee pays that their employer does not pay and also does not reimburse them for. So if you tell me you earn $100,000 a year,
I often have people ask me if they can lend their son or daughter money instead of giving it as a down payment gift. Or some want to lend the money and then forgive the loan over time to avoid the gift tax. It seems many want to help their family but avoid taxes while they do it.
First, from an underwriting and mortgage guideline standpoint, this is not an option.
I am from the government and I am here to help you. That punch line seems to be coming more and more true these days. Fannie Mae and Freddie Mac were taken over by the federal government in bankruptcy receivership in 2008. Fannie Mae and Freddie Mac, along with FHA and VA make up almost 100% of mortgage lending in our country. I would not say that the mortgage industry has been socialized, but it certainly is dominated by government. In the last four years the big government stamp on the mortgage process is undeniable and is the sole reason people scream bloody murder at their mortgage lenders during the process. Below are some exact reasons you can thank the Feds for your mortgage nightmares: