In the rush to prevent mortgage fraud, some would argue that the baby has been thrown out with the bath water. Before the boom of recent years, so-called 'exotic' loan products existed in harmony with nature. They were rarely used, like a sharp curved knife in the back of the drawer that has no place on the dinner table but still gets used every once in a while to complete a specific task.

Option ARMs and stated income loans are much like these knives. Intended to be kept away from children but very handy in a time of need for a skilled investor. In recent years these tools were offered to everyone and both borrowers and lenders have been cut deeply.

We feel like there are experienced, well qualified borrowers out there who are interested in these products either as a convenience or as an investment tool. Therefore, we are going to put our toe back into the water and see how it goes. As of May 1st, our company will be offering stated income loans up to 80% of the purchase price for borrowers with six months worth of income reserves and a 680 credit score. Realtors, loan officers and construction contractors are ineligible at this time until we establish trends.