State Income Mortgages And No Doc Mortgages For Your Situation

Is the mortgage market ever going to go back to normal? The stated income and the no doc mortgage will be the top options in the next couple of years for new home loans and refinances. These types of loans have changed their requirements over the last few months and getting a stated income or no doc mortgage has become even easier than it used to be. The credit score requirement has become a bit lower and the other requirements have also become a bit eaiser.

A few years ago you would have only been able to get about 70% loan to value on a stated income program, and would have needed a 620 credit score to qualify for such a loan. This has changed quite a bit over the last few months and mortgage companies are getting a bit desperate for business so they are willing to loan more money to those that have trouble proving their income like tipped employees, self employed individuals, and indepentent contractors.

When the no doc mortgage came into play about 20 years ago they were designed specifically for the self employed borrower that has a lot of trouble proving the income they need to qualify for a conventional mortgage. This caused mortgage companies to get more business. The first programs were only for those with perfect credit and either a large down payment or a very low debt to income ratio. These programs were very successful and there were very few defaults.

We have just entered into 2008 and the foreclosure rate continues to grow. If you have good credit and have income that is hard to prove, then it is time for you to ask your mortgage professional about a stated income program or a no doc mortgage. This will give you the leverage you need in order to get the loan you need and stay away from foreclosure.

Author: BENJAMIN EHINGER