We just recieved our closing documents via Fed- Ex on yesterday and although this was a full doc loan I noticed the 4506 form in the packet, I don't want averyone asking for our returns and on the form they haven't even checked what they are looking for from the IRS and the years are also blank, I want to know can we REFUSE to sign this and what is this actually used for, we are in the closing stage of the loan so this makes no sense to me. The loan is to fund on Thursday so I am just wanting to be sure this is ok
I "THINK" that is only used if NEEDED...if you are CLOSING ON THURSDAY...IT IS ALREADY A DONE DEAL!!! They have all they need...THEY SHOULD NOT NEED A SIGNATURE...but if it is a DEAL KILLER...you better sign it!!!
The lender is asking for your permission to get copies of your previously-filed tax returns from the IRS rto verify the previous income you reported as being consistent with what you reported to the IRS. I have been told by several Mortgage Bankers and Mortgage Brokers that this is not a fishing trip, it is part of the due diligence and compliance FNMA requires. If you refuse to sign it at closing, expect the loan not to close. If you refuse to sign it after closing, expect the loan to be called in, as you will probably find, buried somewhere in the Promissory note, in the section labeled "Acts of Default" something to the effect of the failure or refusal to execute any document required by the lender for purposes of complance or re-sale of the obligation. As a tax accountant, I can tell you that minor variations will not be a problem. Six-Figure variations may trigger a calling of the note and an IRS audit.
That's the form that authorizes the lender to request a copy of your tax returns, right? This is not something your lender is planning to do. The purpose of this form is to help an auditor if your loan comes up for a random audit. Large investors will perform spot checks to insure the quality of their investments. When an investor takes a large pool of mortgage loans, they will pull a small percentage of those loans and audit them for quality. One of the things they will do in this process is request tax returns from the IRS to make sure they match with the income documentation provided for the loan. So what happens if they don't match? Well, the first thing they will look at is the loan officer who did the loan. They will pull a sample of his other loans to see if this is a pattern that could indicate fraud. There are some mortgage lenders out there who will print up fake W-2 forms to make loans work. This could mean that the loan officer is qualifying borrowers who shouldn't qualify to make more money, or it could tip off an illegal "flipping" scheme involving straw-buyers and under-valued properties. The bottom line is that it doesn't really have anything to do with you, it's just something the investor requires. If your loan gets audited, chances are you will never know about it.
Thanks, from readind through everything it looks like they are going to sell the loan, this is esmartloan.com a division of horizon national bank, have any of you dealt with them before ? It looks like the loan is going to GMAC any thoughts there ? Thanks
Mycroft - Can I e-mail you, so we can chat about some of the details, I haven't been aboe to find any info on them but I assume they just sell loans.
Re: Re: Irs 4506 ..Closing Document ???? I'm sure they do sell their loans. You can e-mail me if you like. Put "Creditnet" in the subject line so I don't accidently delete it along with all the spam I get.
Re: Re: Irs 4506 ..Closing Document DO ****NOT**** SIGN A 4506 IF YOUR LOAN IS A STATED LOAN. YOU ARE PAYING EXTRA FOR THE "STATED" DOC OR "NO-DOC" LOAN YOU SHOULD NOT SIGN THE 4506 UNLESS ITS A FULL DOC LOAN! Also, it will be included in the package you are asked sign at the closing... that is because the computer generated the closing docs, it does not mean you need to sign it!
Re: Re: Irs 4506 ..Closing Document Thank you guys very much, I Fed-Ex the docs back with out it, we'll see what happens.
Re: Re: Irs 4506 ..Closing Document When I refinanced three months ago, the form was in my packet, but we did not sign. Our loan went through fine. Michelle
What are you so afraid will happen if you sign this document? I truly don't understand why you're making such a big deal of it.
Re: Re: Irs 4506 ..Closing Document ???? I balked at this also. If you provide the required documentation otherwise, why do they want this from everyone? I understand it is IF they get audited, but the fact is, if you read it, you give them permission to get your tax records, period - NOT just in the event of an audit. I have come to believe that what I give someone permission to do, they WILL do. Later, if you say, "But you said...." they say,yes, but we have your signature here, giving us permission..." I have gone around with the IRS on occasion, don't want to do it again.
Re: Re: Irs 4506 ..Closing Document IF YOU ARE PAYING "EXTRA" FOR A "NO-DOC" OR "STATED INCOME" LOAN, WHY SHOULD THEY HAVE THE RIGHT TO CHECK? YOU PAID A MORE EXPENSIVE RATE THAT THEY SHOULD NOT CHECK! P.S. THE 4506 THEY ASK YOU TO SIGN IS............... UNDATED. KNOW WHAT THAT MEANS?
Re: Re: Re: Irs 4506 ..Closing Document They can check it anytime, for any dates, whatever they want.
Re: Re: Re: Re: Irs 4506 ..Closing Document I just pulled my 4506 form from when I closed my loan back in 5/2002. My 4506 is filled out with my name, address, and ss#. Line 5 asks for third party information if different from line 3 (which is me). Here is listed the mortgage company and their address. Item 8 is: check only one box to show what you want..... They checked d) Copy of tax form and all attachments (including Form(s) W-2, schedules, or other forms)...... In summary, the mortgage company filled out the request for 1040's and any attachments for the years 1999, 2000, and 2001. I signed and dated the form on the day of my closing 04/14/02 (I think). THIS IS THE KICKER: In the instructions section of the form, the fourth paragraph reads: Note: Form 4506 must be received by the IRS within 60 calendar days after the date you signed and dated the request. So unless they immediately send in the request within 60 days of closing, they cannot use the form that you signed. Maybe you should call the company to ask what specific information should be included within the form, so its not BLANK when you send it in. I NEVER sign blank papers. NEVER.
Re: Re: Re: Re: Irs 4506 ..Closing Document Not signing it. I was told it was only if they get audited, hehe.
Re: Re: Re: Re: Irs 4506 ..Closing Document Not signing it. I was told it was only if they get audited, hehe.
