Has Lending Really Come To This?

This gave me a good chuckle!!

Never rob a bank to repay the home loan.  Got it.

Thanks for the laugh!

Yes and those who did get funds from those business opportunities will admit to the lender as they are trying to take a loan?:) yea right.... Endre

Gee; Kathleen Daniels they forgot to include prostitution and throw in political graft in the process just so we can say the pendulum swings both ways!

Here's my thought.  If they find out that money has been obtained illegally and suspect it is being used to pay the mortgage, they may be able to go forward with a foreclosure. 

Hi Kathleen - This is an outrageous case of housing discrimination against criminals - particularly since it's such an effective tool. Kudos to the legal department that came up with this - everyone is safe now. Have a great weekend!

Hi Kathleen, this post as well as all the comments made me laugh. Unfortunately, it's not a joke. Do they actually think anyone obtaining money in one of these ways would admit?

Kathleen I have been an LO for a number of years, but have never seen that form.  As far as who will regulate it, the answer is simple, No One!!!  Just another example of another regulation that will not be enforced, and another form to kill more trees.

I agree with Chris Ann. They can use that as a reason to foreclose. Also, it is a release of liability of sorts in the event the feds raid the house, arrest the owner and then look to the deep pockets of the lender for funding the criminal behavior.

Interesting that they put pot at the top -- probably what they were really going for.

Oh, my - another reason to waste trees, Kathleen! I'm assuming this new certification came as a result of CA's legalization of marijuana? I wonder if CO or WA have this same certification requirement. 

Another new form and like you, Kathleen, if a person is breaking the law why wouldn't they sign the form and say they weren"t? The government is so dumb on things like this and others.

Well intentioned, and whoever came up with the idea feels pretty good about this.

Hi Kathleen... have not yet come across this one... but I'm sure the day is coming!

That's a new one to me, Kathleen. Pretty funny, actually. I think they left off a few sins. Does it have to be notarized?

Jeff

One would think after the qualification process itself, the borrower would have met ability to repay (ATR) so adding this disclosure would be superfluous.  But then you have to thank our lawmakers for the additional confusion that stems from the fact that HELOC loans are treated differently under Dodd-Frank, so I suppose yet another disclosure to say, "Hey, can you really repay this loan?" is, in their eyes, a good idea.  

IMO, the addition of each disclosure creates a "numbing effect" for all the others.  Nobody stopped to realize that at a certain point the borrowers become overwhelmed and simply stop reading what they're signing.  

If I were left to redesign the closing process, I would get it all down to 10 pages.

I wonder if those guidelines only apply to U.S. citizens for owner occupancy??? What if it's a cash buyer - nobody would never know; nobody would care.