We have had 5 or 6 self employed people this last month and all want to go NO DOC, all over 700 scores, all on advice or family and friends. And I always ask them why? What I like to do is show them 3 options.
- No Doc where all that is on the loan application is their name, social,address and liabilities. This is the easiest but the most costly. The rate for this loan today is approaching 8%.
- NIV otherwise know as No Income Verifier. On this loan we list and prove at least 2 months PITI for assets and only list the employment, we no do not verify income and the rate is about 7.5 to 8 % today.
- STATED INCOME/STATED ASSETS You have to love this program. Stated your income and your assets. I know you are saying STATED? but for a self employed client it really is the best program. Why do you ask? Because the rate for this loan is 6.75% today. And if the client has a business license to document at least 2+ years of self employment, it is the only documentation that is needed. They also will sign a 4506T in the event the loan is audited for quality control. This is only to make sure that they do pay their taxes and not to verify income.
At this point the client makes the call on the loan program that they are most comfortable with, one actually stayed with the No DOC (no business license), one went NIV (multi layered partnership, so no business license with her name on it), the others went stated/stated. Options are good.
Have a wonderful day
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