Stated Income LoanHow Stated Income Mortgage Loans Work

August 4, 2016by Darryl Bledsoe

Lender Stated Income Mortgage LoansStated income mortgage loans are very common now that the lending guidelines have relaxed, but many people do not know exactly what they are or how they work. Stated income mortgage loan allows the borrower to state the amount of monthly income when applying for a mortgage, without having to verify the amount by furnishing tax returns or pay stubs. Borrowers can quickly and easily qualify for the purchase or refinance of an investment property without having to go through the slow and painful process of traditional underwriting.

Stated income mortgage loan programs were originally aimed at borrowers who were self-employed and who had complicated tax schedules, but today it has become more widespread, simply for the reason that borrowers appreciate the ease of the documentation-free application process.  Sophisticated borrowers view Stated income loans as the quick and easy alternative to conventional loans to buy or refinance an investment property.

How Stated Income Mortgage Loans Work?

Stated income mortgage loans do not require a borrower to verify income with tax returns or pay stubs. The borrower is required only to provide a statement indicating the amount of money earned. This provides an approximation of the household’s income. Typically, the stated income lenders want just to determine that a borrower is able to pay the mortgage in accordance with the terms of the loan.

Stated income loans do require a sizeable down payment (usually 30%) as well as a minimum credit score (usually 600).  Because stated income loans are inherently riskier than loans with income documentation, the interest rate may be slightly higher than a conventional loan.

As a borrower, stated income mortgage loans are a great way to finance a purchase or to refinance an investment property.  As long as a borrower provides accurate information and has a good credit score, approvals are quick and easy, and funding the loan is significantly faster compared to conventional loans. The difference in premiums and interest rates depends on the lender you choose. Different lenders may offer different interest rates as well as processing times.

How to Qualify for a Stated Loan:

  1. 600 FICO / $125,000 minimum loan amount
  2. 30% down payment [or 30% equity for refi]
  3. Non-owner occupied property


QK mortgage lets you view different stated home loan providers and compare different loan plans and features. If your credit score is low or your reported income is low, stated loan lenders are a good solution. The team at understands your needs and provides a plan which suits your requirements.  Your loan can be preapproved on the first call, and fully approved within hours.  Call our team and get approved today: 818-465-5838

How Stated Income Mortgage Loans Work
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