The real estate community has no doubt noticed the days of quick closes are gone mostly due to the arduous regulations being imposed on the lending industry to fix problems, that for the most part no longer exist. I am referring to getting rid of the individuals who came into the business to make a fast buck, and not caring what was in the best interest of the consumer. Many of these regulations can cause horrendous delays in closing, for example, this abomination forced on us by HUD called the new, improved, Good Faith Estimate. Today I was made aware of a new time waster as I like to call them.
Realtor's should know that due the fraudulent W-2's, 1099's, and tax returns used by the previously mentioned bad apples, we have to send form 4506T to the IRS to verify the tax documents match what the consumer provided us. The I.R.S. has informed us that if the address on the 4506T does not match what they have on record it will be rejected. To clarify, the logic used by the IRS is as follows:
One of the addresses provided on the 4506T form must match IRS records (typically the address used on the last Federal Tax Return.) If neither supplied address is matched, the request will be rejected.
Should a consumer need to update an address, IRS, Form 8022 should be used and sent to the IRS 4 to 6 weeks prior to any request for tax documents. This is a delay we can prevent by making the consumer aware of this added burden.
Happy Lending,
Steven B. Harkness
Washington Financial Group, Inc
steveharkness.com
Mortgage Loan Originator
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