The housing market implosion in 2007-2010 was largely due to unsubstantiated income claims on mortgage applications, which resulted in lending money that could not be afforded by people. This is the reason that moneylenders are now using 4506-T forms to verify income before lending. The taxpayer is required to sign this 4506-T form, which authorizes IRS to release transcripts for verifying previous tax returns. According to Government guidelines, Federally guaranteed mortgages require 4506-T forms to be filed at two different points in the application process.
The 4506-T form is available without any fee but filing it individually can take you huge amount of time and cost extra money. The requests can take up to 60 days in order to get a reply from the IRS. However, there are some companies, which provide this service for a nominal cost and fast track the process. These companies can fulfill the request within 24-48 hours.
The companies appoint professional agents who will make sure that all the paperwork is ready along with a correctly filled 4506-T form. These companies work as authorized bulk vendors and process millions of applications in a year. This makes the task easier and faster for individuals, companies and even the IRS.
In order to avoid any type of fraud, IRS matches all the information carefully and then releases the transcripts. The filling of 4506-T form incorrectly is also one of the reasons that so many forms are rejected every year. Therefore, it is very important to start right and complete the form with correct information. You can also complete the whole process online with the help of E-signatures on IRS form 4506-T.