@Anonymous wrote:
If a loan processor reviews the Paystubs, W2's, 2-Years of tax records and VOE's and she/he is not comfortable that the earnings match (much lower) what the borrower stated in the 1003, should the loan processor still send the file to the underwriter?
The processor would contact the borrower or have the LO contact the borrower to find the missing income first. If there is an error on the 1003 then this is the time to correct it before it gets to the u/w.
It is the processors job to find any discrepancies and provide correct information to the u/w. This income discrepancy is a huge red flag to the lender. Believe me, they aren't going to continue to process the loan if the income has been misstated on the 1003. There are very serious consequences for the borrower for fraudulent statements on the 1003. There are checks throughout the entire process to catch these 'errors' including a quality control check prior to issuing the loan.
