This is an unusual Daily Pick because the article isn’t from today. In fact, it was published in the Las Vegas Review-Journal almost a year ago. The article claimed that passage of a new law in Nevada would make it illegal to grant a stated income mortgage. The Southern Nevada Chapter of the American Bankers’ Association fanned the flames further, implying that investors who purchase stated income mortgages originated in Nevada “risk jail time.” Therefore, those with stated income mortgages would be unable to refinance them, those who need them would be unable to get them, causing a real estate catastrophe.

Well, there is a catestrophe in Nevada, but there is very little evidence that it is the result of stated income mortgages. And today the loans continue to be available in the state. Rather, the state’s property market collapse is probably the simple consequence of an oversupply of housing brought on by more construction and speculation than could be supported by population growth. And stated income loans continue to be available, although like all mortgages they are more difficult to get and may cost more.

The bottom line for anyone considering mortgage financing is to ignore the hype, speculation, and hysteria. If you want to know what’s available and what you have to do to get it, go to the source — a reputable lending professional can get you the latest mortgage market pricing, product information, and underwriting guidelines — no rumor mill needed.

This entry was posted on Thursday, June 12th, 2008 at 2:10 pm and is filed under Daily Pick. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.