Oh wonderful gurus of bankers online, I am looking for a specific place to find where it says that history of on time payments could be taken into consideration when determining ability to repay. I have googled and googled, I may not be searching for the right term.

Do you mean instead of the DTI or residual income?

I am most interested in a renewal that will not fly under the ATR rules, but they have always paid us on time. They cannot prove income. I thought this was addressed somewhere that instead of foreclosing we could take this into consideration when trying to do ATR.

I think the only place the regulation specifically addresses payment history on an exisitng loan is when you're looking to do a refinance from a non-standard to standard mortgage.

If it's not a non-standard mortgage, then you're still going to need to consider the 8 underwriting factors. Payment history on an existing loan can certainly be a mitigating factor but it will not replace the 8 ATR fators.

Darn, thanks for your help.

Cheech - I believe a majority of banks that have loans up for renewal and the borrower(s) doesn't qualify will be doing modifications before the loan matures.

That was the plan but 1 slipped through the cracks and was not modified prior to the maturity. They have paid on time for three years and can only document 5,000 in income. (They must be making cash on the side or receiving help from someone)

cheech, see if this thread helps.