Caller:  Hi…My name is XXXX and I’m looking for loan to buy a new house (or beach house, mountain house, investment property) this month.

Me:  Great!  We’d love to help.  Tell me more about what you are looking to do.  How’s your credit?  How much are you putting down?

Caller:  My credit is Ok.  I think it is the high 600’s.  I can put 20% down.

Me:  Ok.  We’ll get you approved, but the reality is we should look to see how we can raise your credit score a little bit.  In many cases, we can pay down a little bit of your revolving debt, and gain 40-50 points on your score.

Caller:  That’s great.  Let me make a list of what I owe and we can review.   Oh…also, I own my own business and need to go “stated”.

Me:  Silence……..

Me:  Unfortunately the stated, no ratio, and no documentation programs are all gone.  As well know, the changes in the mortgage market as a result of the subprime meltdown are dramatic.  Even for someone with an 800 credit score, you absolutely must document your income.

Caller:  Ok….I file my taxes, but only claim a small amount of money each year.

Me:  Let’s see what we can do with your real income, debts, and what you are looking to buy.

It may take another year or two, but eventually the word will get out that stated loans are gone.  In my opinion, we will not see this product back on the residential side for many years to come.  While stated loans are not the sole reason for the subprime crises, the reality is that stated loans are viewed as a big part of the problem that has devasted our financial markets.