(Update) Allow for negative self-employment income

(Update) Allow for negative self-employment income

Update 5/1: This feature was built for mortgage applications only. The release note below has been updated to clarify this detail.

Date Available: Beta 4/18, Prod 5/16

Which customers are impacted?:
Any lenders that use the Blend lender application to input or edit borrower income for mortgage applications.

How to turn on:
This feature will automatically be turned on for all customers on the dates listed above.

Purpose of Update and Benefit:
Blend currently does not support entering negative values for income. This makes it difficult to account for incomes of self-employed borrowers who may have business losses. With this change, loan team members will be able to input negative income for current self-employment for primary and co-borrowers on a loan. This change is only applicable to the lender application for mortgage loans.

Current Behavior:
The lender application only accepts positive values for borrower incomes. If loan teams attempt to enter negative values, they will see a message below each field instructing them to enter an amount greater than 0 and will be unable to save the loan.

New Behavior:
When enabled, loan teams can enter negative values for all income fields for primary and co-borrowers when all of the following criteria are met:
- Employer status = Current
- Employment type = Business / Self-Employment
- Ownership percent = > 25%
              - When ownership is < 25%, Blend treats this as employment and NOT
                 self-employment, per GSE rules.

This change is only applicable to the lender application.

If the Employer status is not Current OR the Employment type is not Business /
Self-Employment, loan teams will see a message below the field prompting to enter an
amount greater than 0. Loan teams will also be unable to save the loan.

If the Ownership percentage is < 25%, loan teams will see a message below the income field(s)
where any negative values were entered indicating that the ownership is less than 25% and
prompting them to enter an amount greater than 0. Loan teams will also be unable to save the loan.

While DU and LPA both accept negative income for self-employment for individual employment items, submitting a loan where the monthly income is negative will result in errors in the output files and the indicators in the AUS results page.

0 Votes