Stated Income Second Mortgages Understanding No Income Verification

Stated Income Second Mortgages Understanding No Income Verification Loans

Stated Income Second Mortgages: Understanding No Income Verification Loans
What is​ a​ stated income second mortgage? a​ stated income second mortgage is​ one that does not require the​ borrower to​ prove income stated on​ the​ application .​
This is​ most advantageous to​ self employed and contract workers who receive a​ 1099 instead of​ a​ W-2 as​ they would have a​ difficult time proving their income .​
Stated income mortgage loans are the​ most commonly used and usually the​ least expensive of​ the​ no documentation types of​ mortgages.
Mortgage lenders understand that it​ is​ difficult for individuals who are self-employed or​ operate a​ one-person firm to​ verify their income .​
Different types of​ no income loans are offered including state income or​ no income verification loans.
Inquiries should be made to​ a​ loan officer as​ to​ the​ types of​ reduced documentation information required to​ secure the​ loan .​
Lenders may require anywhere from 3 to​ 6 month reserve for principal interest taxes and insurance (p.i.t.i.) .​
If the​ monthly p.i.t.i .​
payment is​ $ 2,​000 a​ month; the​ lender may require proof of​ assets anywhere from $6,​000 to​ $ 12,​000.
A fixed rate second mortgage is​ a​ way to​ refinance higher adjustable rate second mortgages or​ home equity loans .​
If the​ interest rate on​ the​ second mortgage is​ below the​ adjustable rate,​ lower payments monthly would be a​ benefit of​ the​ second mortgage.
Home equity loans can serve a​ number of​ purposes .​
They can be used to​ reduce credit card debt,​ consolidate high interest credit lines,​ make home improvements and pursue educational endeavors.
Stated income lines are available to​ all borrowers but the​ lenders usually require the​ borrower to​ have a​ minimum credit score .​
The higher the​ credit score the​ better the​ interest rate offered.
A stated income second mortgage loan is​ suitable for borrowers who have no verifiable income and have assets to​ meet minimum reserve requirements of​ the​ lender .​
The stated income on​ your application must be reasonable in​ terms of​ your assets .​
Qualifications for no income verification loans require the​ borrower to​ have a​ minimum credit score .​
While it​ varies from lender to​ lender,​ most lenders will require the​ borrower to​ have a​ credit score above 580.
The lower the​ credit scores the​ higher the​ interest rate the​ lender will require .​
If your credit score is​ high you​ may be able to​ take advantage of​ a​ fixed rate second mortgage before the​ interest rates increase above 7% .​
Consideration is​ usually given to​ the​ tax consequences of​ the​ different types of​ loans .​
a​ tax adviser should be consulted before a​ borrower commits to​ a​ mortgage whether he is​ a​ first time buyer or​ an​ experienced homeowner refinancing.

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