During the mortgage lending boom in the middle of the last decade, prospective loan originators and mortgage brokers would lend money to almost anyone, whether the perspective homeowner had sufficient income to pay the loan back or not. In recent days, however, lenders are risk-averse, and they are demanding detailed documentation for all areas of the applicant’s financial status and background. Borrowers should be prepared to answer questions about gaps in their employment, pending lawsuits and even divorce proceedings.

There is, however, a limit to how much personal information can be requested. Questions about whether an applicant is pregnant are prohibited under federal law, but lenders have figured ways of getting around those delicate (and unlawful) inquiries. For instance, the lender may ask a young woman, applying for a mortgage on her own, whether she has any children yet, or whether she likes children. While this may not be unlawful, it certainly is a turn-around from the way business used to be conducted. Racial profiling is fair game in the paperwork, largely so regulators can identify and keep statistics on whether race is a factor in the kinds of loans offered, interest rate and other qualifying factors.

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To set up a free initial consultation, contact our office online or call our foreclosure hotline at 855-289-1660. Or call our office location in Philadelphia at 215-751-0100, or in New Jersey at 856-429-0970.