Stated Income Loans

Stated income loans mean that little or no documentation is required to buy a home. These are also called “low doc” or “no doc” loans.

Full documentation (full doc) loans require a list of creditors, 2 to 4 months of paycheck stubs, W-2′s, the last two years income tax returns and two months of bank statements. Some lenders also require a letter from your employer to verify your employment.

Stated income loans require that you state your prior two years income and that you have a good credit score. You’ll still have to supply bank statements, tax returns and possibly other documentation. So, the terms low doc and no doc may be bit misleading.

Interest rates can be from a half to three points higher than conventional loans.

No Ratio Loans

Another type of stated income loan is no ratio loans. With these loans a debt to income ratio is not computed. You do have to provide a list of assets including stocks and bonds, cash and real estate. This loan is good if you are wealthy and prefer your financial details not become public.

No Income No Asset (NINA) Loans

These require the least amount of documentation. All that’s necessary is an excellent credit history and a property appraisal.

Stated Income Loan Borrowers

In general these loans are made if you receive irregular income, work on commission, are self employed or famous.

The source of income has to be verified for a state income loan even if you don’t have to show pay stubs. Plus, you will be required to produce income tax returns.

Steve Wyrostek -HomeLoans.org Expert A 20 year plus veteran of the insurance industry, Steve managed departments in the personal and commercial lines areas of major insurers. He’s familiar with how insurance—ranging from boat to workers compensation—works.