It can get a little challenging if you wish to purchase a real estate property but don’t have a stable income. However, you can still get no-income verification mortgages if you have complex self-employment income or if you fail to meet the minimum income requirements for a traditional loan. A no-income verification mortgage loan (also known as a no-doc mortgage or stated income loan) requires much less paperwork to get approval. Such loans are a faster way to access funds than a fully documented loan, especially if you have complex tax returns. Nowadays, stated income loans come with added consumer protections, making them an ideal alternative to traditional home loans. At Real Estate Funding Solutions, our team can assist you in obtaining a no-income-verification mortgage, but you must first understand what it is and how it works.
What Do You Mean By No Income Verification Mortgage Loans, And How Do They Work?
No-income verification mortgages are home loans that do not require standard income documentation (including W2s, pay stubs, or tax returns) to get approval from your lender. In this type of loan, a lender will allow you to use other documents, such as your bank statement, to prove that you can quickly repay the mortgage in time. No income verification mortgage loans were more commonly known as stated income loans before the housing sector crash of 2007 and 2008. These loans were prevalent amongst self-employed borrowers since they could “state” whatever income they needed to qualify. Most no-doc mortgage lenders tend to offer borrowers a variety of no-document or low-document mortgages based on their unique needs. Below you will find some of the most common programs and who may benefit from them.
Bank Statement Mortgages
A lender will calculate your income based on the average of deposits made into your business or personal bank accounts over the past 12 to 24-month period. If you tend to receive cash deposits regularly that can be documented easily via your bank statements, this may be a good option for you.
Regarding asset-based mortgages, a lender will qualify you based on 100% of all your liquid assets divided by your total loan term. For instance, someone with a $1 million net worth applying for a 20-year mortgage or asset-based loan would have $50,000 each year of qualifying income. Wealthy borrowers with a high net worth will benefit significantly from such no-income verification mortgages. You can even find a few institutional banks that offer these loans to customers who have large balances on deposits.
No-Income, No-Asset Loans
NINA (No-Income, No-Asset) loans are approved based on your projected rental income from the purchased property. These loans are only available for real estate investment properties. Ideally, as long as your rent can cover the new mortgage payment, no asset or income documentation is required. If you are a real estate investor with enough cash for a high down payment, you can quickly build your investment property portfolio using this loan.
How Do You Get A No-Income Verification Mortgage Loan?
A no-income verification mortgage loan does not mean the lender will give a loan to anyone. No income verification borrowers applying for a loan must make an excellent effort to show lenders they can repay the loan on time. It means a lender will ask you for some other type of proof that shows you can afford the payments. Below are a few standard requirements for no income verification mortgage loans:
- No-income verification mortgages will generally require the borrower to have a higher credit score than a conventional loan with income documents.
- The minimum down payment on no income verification loans ideally starts at 20%.
- A lender may charge you a higher rate than you would expect to pay for a conventional mortgage to cover the risks of forgoing documentation.
- Whether rent from an investment property, bank statement deposits, or a stockpile of assets, you need to prove to your lender that you have enough resources to make monthly payments on your loan.
Have Any Queries? Contact Real Estate Funding Solutions For Answers!
If you have any issues, concerns, or questions related to no income verification mortgage loans, we can help. Thanks to years of training and on-field experience, our team from Real Estate Funding Solutions can help answer any questions you may have related to no-doc loans. Moreover, since our team has helped several individuals get no-income verification mortgages in the past, we can swiftly guide you through the process easy. Our team can also help you gather all the essential documents to prove that you will not default on your loan. With our expertise and professional guidance, you can easily access funds in no time. Want to get started? Call our team today at 855-913-8637 to discuss how you need to proceed with the loan process.