Wells Fargo announced today that after March 28, 2008 they would no longer accept "stated income" applications. "Stated Income" loans grew popular over the past few years especially for applicants who were self-employed and reported large deductions on their tax returns. The program allowed applicants such as this to "state" their income on their application without documenting or proving this for the underwriter.
Wells Fargo was one of the last investors out there who was approving these loans but now it looks like this flexibility will be lost at least for the foreseeable future.
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