IRS Tax Disclosure form for Stated Income No Doc Loan?

I'm in escrow on a stated income product. I have given my monthly income, and documented my self employment with an "accountants letter" for 2-years per the Loan Officer's request. Now I'm getting ready to sign Loan Docs in the escrow office. The escrow officer at my request described the forms we would be asked to sign, one of which is an "IRS FORM" that gives the Lender permission to check my income per tax returns for prior years. Due to all my deductions the income will not appear identical. Can they deny funding my loan based on what the IRS gives them? I thought this was supposed to be a "no doc" loan, but now I'm surprised w/this form and escrow is due to close any day now. Will this be a problem for me?

I think the form you're being asked to sign is one that gives a bank auditor permission to pull your tax returns if the lender gets audited. It's usually to show that the tax returns used to secure the loan were really what the IRS had also. Since you didn't show your returns, I wouldn't expect them to be pulled.

"Stated income" type loans, although probably over used to get people into houses that they cannot afford, are supposed to be within "reasonable range" for amount of income for your type of work.

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