For the past few years, no Income verification mortgage loans have been the go-to loan programs for real estate investors looking to acquire investment properties. We are going to go over some of the reasons why so that when you are ready to add to your real estate portfolio, you can decide if a stated loan is right for you.
What is a stated mortgage loan and why is it such an important tool for many real estate investors? A stated mortgage loan put in simpler terms is a no-doc mortgage loan. When you apply for stated income loans you will supply the lender with proof of down payment, photo ID, lease agreements and show a good credit history.
Obtaining mortgage loans without income allows investors to theoretically acquire as many properties as they wish without having the lender deny their application due to personal income limitations. The process 15 to 20 days).
Are mortgage loans without proof of income legal? The answer is yes. Primary residence borrowers are heavily regulated and considered “consumer loans”. Consumer loans require the borrower to show the ability to repay the loan via Tax returns and in most cases the borrower must survive an extensive period of underwriting. During this period the underwriter may require additional conditions that may hinder approval. Stated income investment loans on the other hand demand no such investigations and rarely is your approval delayed or denied. These loans fall into the non consumer guidelines of lending and are only available to real estate investors to purchase or refinance non-owner occupied properties.
How can investors apply for stated income loans? Stated income loan programs are easy to qualify for with 9 out of 10 borrowers only requiring a photo ID, proof of property insurance and sourcing of down payment funds (Minimum of 20%) to obtain lender approval.