No loans for Sellers with Undocumented Income

The exact reason No Income Verification loans were created in the first place is the exact challenge now facing numerous potential homeowners who no longer can get a loan - unless you know a R E A L L Y good mortgage broker who has a personal and private relationship with some good banks. Oh, and by the way - this is also the same reason Chris Daly's rental assistance law is diabolical. There's no way to account for undocumented income...

With more than $300,000 in combined annual income, tens of thousands of dollars in the bank and credit scores that top 800, Jennifer France and her partner would seem like ideal candidates for a mortgage refinance. But when they applied to swap an interest-only loan on their nearly $1 million San Carlos home for a 30-year fixed that locked in today's low rates, they were summarily denied. The reason: effectively, because both operate their own businesses.
"I was really surprised, I had been preparing to refinance for years," said France, a landscaper and gardener. "It's hard for the self-employed; that puts us in a bind."

While the amount they make is easily enough to qualify for the new loan, tax deductions for self-employed workers dropped their official income below the threshold that banks wanted to see. A few years ago, theirs would have been the ideal scenario for a stated-income or no-documentation loan, which allowed individuals with ample but unconventional sources of income to secure home loans. But after untold numbers of borrowers lied about their financial wherewithal to buy homes they couldn't afford, often with a wink and nod from mortgage brokers, nearly all lenders stopped offering what became known derisively as "liar loans." Now even the well-qualified borrowers for whom the products were first intended can't get them. [more]

Undocumented income makes it hard to get a loan [SFGate]
The Giant Pool of Money - Hands-down best description of the Credit Crisis [SFHomeBlog]
Daly's Draconian Renter's Relief Package Passes [SFHomeBlog]

Daly's Draconian Renters Relief Package Passes - Mayor veto coming

It's basically on Beven Dufty and Sophie Maxwell who does not have to vote for now...to make sure it does not end up in a veto-proof vote. I have no problem with certain aspects of rent control (although there's a decent argument that it hurts more than it helps) - but this measure weights all the burden, including the burden of proof on one end of the population so completely I cannot believe it's even legal. Sane people do not just think that a tenant who opts to work half time - or ends up with half their income coming from under the table is not going to apply for a reduction in rent and get it - with no recourse on the property owners part...uh, where's the sanity in that?

Oh yeah, it's a Daly proposal what was I thinking...calling for sanity.

Rent Plan Promises Relief - to Lawyers [SF Buisness Times]
Proposed Laws for SF Renters + Mayor Weighs In [SFHomeBlog]
Beware of Supervisors Bearing Gifts - Jeff Woo [SFGate]

Board to Vote on Daly's Renter's Relief Tuesday June 23rd

Supervisors Will Vote on Renters Economic Relief Package June 23. Vote Delayed Pending FPPC Decision on Maxwell Conflict. The Government Audit & Oversight Committee approved the Renters Economic Relief Package forward at its hearing on May 28 and forwarded it to the Board for a full vote on June 23. The committee adopted some amendments to the package, most significantly limiting the rent increase suspension to periods when the unemployment rate dips below 5%. The full Board vote was delayed to June 23, so that the Fair Political Practices Commission can issue a written decision as to whether or not Sup. Sophie Maxwell–a landlord who usually votes pro-tenant–can vote. Maxwell sought to be recused but there is some dispute as to whther or not she has a conflict of interest under state laws. If the legislation is to survive a Newsom veto, then Maxwell must be able to vote (and then vote for it). Maxwell is typically the 7th vote and Sup. Bevan Dufty would also haveto support it to reach the 8 votes needed to override a Mayoral veto.

The package of amendments to the city’s rent control law consists of three parts:

•Suspend any rent increases which will cause a tenant’s rent to exceed 33% of their income. This provision expands the law’s existing provision which enables the Rent Board to suspend rent increases based on “tenant hardship” by expanding when a tenant can apply for hardship and defining hardship as any rent increase which would cause a tenant’s rent to exceed 33% of their gross income.

•Expand the rights of tenants to add roommates to help pay the rent. This provision will let tenants bring in roommates so that the rent will be more affordable. The number of roommates would be limited by San Francisco Housing Code provisions which establish occupancy limits based on the size and number of bedrooms in an apartment. Currently landlords are able to limit the number of tenants to levels below what the law allows.

•Limit the amount of “banked” rent increases which can be imposed in any one year. Current law allows landlords, to “bank” annual rent increases and impose them all at once at a later date, often resulting in rent increases of 20% or more. This provision will limit these banked rent increases to no more than 8% in any one year.

Supervisors will vote on Renters Economic Relief Package [SF Tenants Union]
Proposed Laws for SF Renters + Mayor Weighs In [SFHomeBlog]
Beware of Supervisors Bearing Gifts - Jeff Woo [SFGate]