No Income Verification Mortgage Loans
The "no Income Verification" mortgage feature is designed specifically for self-employed, non-salaried or commissioned borrowers as well as salaried borrowers. This feature eliminates the need to verify earned income, although assets and unearned income must still be verified. This feature is offered on several of our Lenders fixed rate conforming and non-conforming products.
This is often referred to as a "No Ratio" mortgage. Income is not disclosed but employment is typically verified.
No Income Verification loans are typically for Self Employed borrowers who do not have much income documentation. These loans are usually approved upon proof of reserves.
It is beneficial to show assets in savings to get more favorable terms with a no-income verification loan.
Certain Stated Income loan programs also have no income verification features, however when you state your income it must be deemed "reasonable" for your profession, title, and experience or number of years in business.
No income Verification mortgage loans are a very powerful tool for consumers who are self-employed. Most self-employed people write off a lot of their income through various deductions and expenses and when it is all said and done, their actual adjusted gross income is considerably lower than what their gross sales were. This is one reason why it is hard to always document what a self-employed borrower's income level is at. Thus a no ratio, no income verification loan is a great product for this type of borrower. You will normally list your employment information on the loan application and then simply leave the income section blank because there will be no verification of any income and thus your debt to income ratio will not be calculated. While this program is very good for certain types of borrowers, keep in mind that it is also a higher risk to a bank and there will be a minimal increase to the interest rate for this type of loan.
No income verification mortgage loans are not meant to be used by borrowers or mortgage professionals to falsify income in order to purchase a more expensive home. Falsifying income on a mortgage application is a federal crime that is punishable by law.