The previous year and a half or so has seen a unprecedented chain of events occur in the New Jersey hard money industry with the fall of hundreds if not thousands of lenders and the elimination of many of the so-called “exotic” products.

When the dust finally settled only the solid have remained prepared and able to lend to qualified home owners. We are proud to be among those standing tall and offering the very top of what is available today for the consumer. Along with standard New Jersey hardmoney that we have available, we are among the few remaining loan companies that can offer No Income Verification programs to our highly qualified Pennsylvania borrowers.

What is the difference between “No Income Verification” from “Stated Income” loans?

The answer is that real “No Income” allows for the verification of a client's employment while allowing the income section of the application to remain [spin]empty. A “Stated Income” mortgage on the other hand, requires a client to “state” an income to be used on the 1003 form, but not be confirmed. It must however, make sense for line of work that the borrower's is in. In both cases, fund verification is required and must be large enough to warrant approval of the loan. There is no set calculation as only common sense will prevail. It is important to note that these products are for owner occupied properties ONLY and the client's MUST be self-employed or retired.

What is the positive of going with a “No Income” or “Stated Income” loan?

With the changes that have happened in the industry there is not a higher level of automated underwriting approval that allows for income to be received as stated therefore, the only choices available for the self-employed or retired borrower are those previously mentioned. Stated Income loans are allowed up to 70% loan to value (LTV) while No Income loans are limited to 60% LTV.

What make these products outstanding as well is that the interest rates are quite similar to Fannie Mae and Freddie Mac income verified mortgages. The add-on to the interest rate is .375% for No documentation and .25% for Stated Income mortgages. To be more specific a 30 year fixed rate as of this blog posting would be 5.50% up to $417K for No Income and 5.375% for Stated Income. These options are available for our 5/1, 7/1, 10/1 ARMS as well as our 10, 15 and 40 year fixed.

If you have been having challenges showing your income with you normal mortgage company then a no income documentation program may be just what you have been waiting for.