Before the housing market took a nose dive in 2008, stated income loans were a hot commodity. Although they’ve dwindled in popularity and are no longer available, there are still alternatives to choose from if you’re having trouble qualifying for a traditional mortgage.
What is a Stated Income Mortgage?
Stated income mortgages are home loan products that do not require income documentation or verification. They’re commonly referred to as no income-no asset (NINA) loans since you technically only need a solid credit rating to qualify.
How Is a Stated Income Mortgage Different from a Traditional One?
Traditional mortgages are only available to borrowers that can prove their income through financial documents. However, income verification is not required with a stated income mortgage.
How to Prove Your Income for a Traditional Mortgage
You can prove your income for a traditional mortgage by providing pay stubs, W2s, and tax returns to the lender.
Can You Get a Stated Income Mortgage Today?
In short, no. The Dodd-Frank Act, which was enacted in 2010, requires borrowers to prove that they’re able to repay a mortgage loan before getting approved by a lender. This legislation protects both borrowers and lenders – the risk of foreclosure is lower, and the lenders are less likely to sustain sizable losses.
You’ll have to do a little more legwork to find viable alternatives. Or you can consider a reputable lender, like Angel Oak Mortgage Solutions, which provides non-traditional mortgage loans.
Alternatives to Stated Income Mortgages: Non-QM Mortgages
Consider these non-qualified mortgage products from Angel Oak Mortgage Solutions to secure the financing you need.
Bank Statement Loans
If you’re self-employed with two years of experience, you may be eligible for a Bank Statement Home Loan of up to $3 million. It can be used to purchase a single-family home, condo or townhome to use as your primary residence, second home or an investment property. Rate-term and cash-out refinance are also available. You’ll need to provide 12 or 24 months of personal or business bank statements when you apply.
1099 Income Loan
Use your 1099 earnings to qualify for a home loan for a purchase or refinance with this mortgage product. Loans between $150,000 and $3 million are available, and you’ll need a credit score of at least 680 to be eligible for funding. Furthermore, you should have 1099 earnings from the same employer for at least two years. You can also use bank statements to qualify.
Asset Qualifier Loan
Borrowers with at least $500,000 in liquid assets, including checking and savings accounts, retirement accounts and stocks, may find this home loan appealing. You should have this amount available post-closing, and it’s a must that the assets are seasoned for at least six months. Asset Qualifier Loans are capped at $3 million.
Investor Cash Flow Loan
Investor Cash Flow Loans cater to real estate investors who’d prefer to use the earning potential on a property they’re looking to purchase instead of tax returns or income statements. This means you can qualify without providing any employment documentation. You can borrow up to $1.5 million, and there’s no limit on the number of properties you can purchase. Like the other non-traditional mortgage products from Angel Oak Mortgage Solutions, it can also be used for a rate-term or cash-out refinance.
How to Get a Non-QM Mortgage
You can learn more about these offerings from Angel Oak Mortgage Solutions by completing this simple online form. If none of these options work for you, there are also traditional mortgage products to choose from that could be a much better fit.
