Effective today, Wells Fargo has implemented a series of tough underwriting guidelines for stated, non-conforming loans via its retail lending channel.
The banking giant and mortgage lender has upped the Fico score requirement to 720 from 660, and will now require 30% of the loan amount as a reserve requirement.
The maximum loan-to-value has also been cut to 80% from 90%, and the max debt-to-income ratio has fallen from 45% to 38%.
Essentially, you’ll either need to provide full documentation or have a ton of assets to get a jumbo loan with Wells Fargo.
The bank is also cracking down on bad credit borrowers, restricting the maximum loan-to-value to 80% for those with credit scores below 580.
Additionally, as of December 15, Los Angeles County is now identified as a “distressed” market, a downgrade from its previous “soft” status.
As a result, the max combined loan-to-value (first and second mortgages) on properties within Los Angeles County will be cut by 10% across the board.