Stated Income Residential Loans
Stated Income Loans have minimized income documentation and therefore have other methods of reducing the risk of the mortgage. Our residential stated loan program are for self-employed and wage earners. Borrowers might use a stated earnings program wherein the earnings specified on the application will not be verified by the lender. For self employed customers evidence of self-employment as well as confirmation of all property accounts is required. Evidence for self employment is normally a Certified Public Accountant letter. Whether you are self employed or are a wage earner, excellent credit (640 credit score or higher) is required to qualify for a stated income loan. We have other programs for borrower with lower credit scores but to get the best rates, a credit score of 720 or higher is preferred.
Some stated loan programs do not require minimum asset reserves but for the best mortgage rates, verifiable liquid assets would be preferred and encouraged.
Why Hard Money?
The certifying standards for a difficult Hard Money financing differs extensively by loan programs and loan function. Credit ratings, earnings and various other traditional loaning standards could be examined. Nonetheless, most equity based loan providers mainly certify a loan quantity based upon the value of the asset/property being used as collateral. The LTV for private equity loans are typically between 65%-80% of the property value.
Stated Income Home Loan Program Overview
About Stated Income Residential Loans
Stated income residential loans are ideal for self employed people and others who find it hard to get loans from banks. Usually, a borrower will approach a lender, and the lender will let the borrower ‘state’ their annual income. From the stated amount, the borrower will decide the amount of money that they will lend the borrower. The borrower and the lender will agree on the amount of interest that the borrower will be paying.
Requirements for Stated Income Residential Loans
One of the things that you will need for you to be given a loan is proof of your source of income. Although, most lenders will allow you to ‘state’ your income, before you are given a loan you need to provide proof that you are employed or you own a given business. In addition, you need to proof your annual income. A simple way of proofing this information is through a bank statement. Most lenders will require you to bring your bank statements as proof. Lenders will look at your employment details; they will check the average amount of money that you earn. If your average amount in the bank statement is different from your stated amount, your loan application will be rejected. In addition to providing proof of your income source, you should have a good credit history. This is because when you have a good credit history you have high chances of repaying a loan as compared to someone with a bad history. This means that when you have a high credit score you have high chances of qualifying for the loan as compared to someone with a low credit score. The final thing that you need is honesty. For you to qualify for stated income residential loans, you must be honest in any information that you give a lender. It’s common practice for borrowers to ‘state’ that they earn more amounts of money than they do. As much as saying this will put you at a better position to be financed, it’s dangerous. This is because most lenders will verify if the information that you gave is true. If the lender identifies that you gave wrong information, you will lose credibility and you will spoil the relationship between the two of you. This compromises your chances of being financed in the future.
Benefits of Stated Income Residential Loans
One of the advantages is that you don’t need to provide mortgage insurance. This makes stated income residential loans so ideal for people without money to get insurance for their mortgages. Another advantage is that the process of getting the loan requires little to no document. This makes it easy to process the loan; therefore, you can get your loan within days after application.
Before you apply for the stated income residential loans, you should first undertake thorough research. Check different offers offered by different lenders and compare their interest rates, terms, and conditions. If you identify a lender offering a package that is right for you, go ahead and get a loan from this lender.