No-income verification mortgage, sometimes called a stated income mortgage, allows applicants to qualify for a loan using non-standard income documentation. While many real estate mortgage lenders ask you for your tax returns, no-income verification mortgage lenders consider other factors such as home equity, available assets, and overall cash flow when giving you approval. This makes it much easier for individuals to get a home loan if they are self-employed or rely on seasonal commissions.
No-Income Verification Mortgage: Explained
When we talk about no-income verification mortgages, lenders do not need their applicants to prove or document their source of income. Other names these mortgages go by include state-income loans, no-doc loans, and alt-doc loans, but all of these fall under the exact definition with only a few minor differences. There are four primary kinds of no-income verification mortgages, each with its unique level of requirements. Let’s discuss all four types in detail:
Stated Income, Stated Assets (SISA)
A SISA loan is the right choice if you have a lot of income and assets that can be complicated to document. When you apply for this kind of loan, the lender will agree to accept the asset and income figures you offer, with no further documentation needed. It can be helpful for small business owners who tend to keep their assets in a business account and don’t usually document their personal compensation using W-2 forms, pay stubs, or 1099 forms. In such cases, the lender can use your bank statements for the past 12 months to calculate your business’s monthly cash flow for other documents.
Stated Income, Verified Assets (SIVA)
SIVA loans are most useful if a significant part of your total income is challenging to document, but you possess several verifiable assets. One example where these loans would fit the best is for individuals whose income is based on gratuities and tips but has a personal bank account registered in their own name. Here, the lender agrees to accept your stated payment and verify all your available assets.
No Income, Verified Assets (NIVA)
A NIVA loan is the best choice for retired individuals who get income from their retirement accounts. Though they might not have any verifiable income, lenders can easily document their assets. A NIVA loan is ideal for applicants with several verifiable assets but no official arrangement to maintain the record. In these cases, the lender will verify your assets and not consider your income.
No Income, No Assets (NINA)
With minimum requirements, NINA loans are ideal for individuals who can’t provide their assets or income documents. These lenders base their approval solely on collateral and other non-income factors. Individuals employed by a foreign organization and holding all their critical assets in a foreign bank might not be able to offer documents acceptable to U.S. lenders. In such cases, using a NINA loan allows the borrowers to skip international asset transfers and document translation.
How Can You Get A No-Income Verification Mortgage?
No-income verification mortgages are available to you via lenders who offer portfolio lending options and are not bound to qualified mortgage rules set by official government agencies like Freddie Mac or Fannie Mae. No income verification lenders utilize private equity from real estate investors to create such offerings. These often include direct lenders (like Citibank, Chase Bank, and U.S. Bank), wholesale lenders (like JMAC, Stearns, and Newfi), and significant financial investment firms. Most other credit unions and banks do not offer such loans since they can be challenging to package and sell to investors in the secondary market. Only a few lenders are willing to commit this kind of capital, given that the only alternative is to keep these mortgage options in-house. The added risk of such mortgages is another reason for most real estate lenders to steer clear of offering them.
Are No-Income Verification Mortgages Suitable For You?
No-income verification mortgages are worth considering if you are self-employed, depend on seasonal income streams, or have difficulty qualifying for conventional mortgages. All these scenarios can make it difficult to document your monthly income, making the simplicity of no-income verification mortgages ideal. However, if you have insufficient income, you should never use these loans as a way to hide your current financial standing. Remember, you must only apply for such loans if you can afford to make timely payments. Consider these loans as a solution to cut down on a lot of paperwork, not a way to avoid the question of affordability.
Contact Real Estate Funding Solutions For More Information.
At Real Estate Funding Solutions, our team has the experience and know-how to help our clients make the best decisions for their investments. Our real estate funding experts can guide you through the process of getting a no-income verification loan and will stick to your side until closing. We have spent years assisting several investors to qualify for mortgages and can do the same for you. Call us at 855-913-8637 to speak with one of our professionals right away!
