Stated Income Loan 

Stated-income mortgages are becoming increasingly popular. The stated-income program is also referred to as the no-income verification loan. This type of loan requires no W-2s, no pay stubs, not tax returns and no verification of state income.

Stated-income mortgage loans are available to employed, self-employed and retired borrowers. If you are looking for a mortgage, but have a difficult time proving your income, then a stated-income loan may be the perfect solution for you.

Stated-income mortgage loans are the most utilized loan product of all no documentation loans. You must have a credit score of at least 620. You must hold at least five active credit accounts in good standing. Bankruptcies and foreclosures must be over three years old, with evidence of reestablished credit. You need to be at your current job for at least two years. Most lenders require more than a 5% down payment.

Stated-income mortgages allow you to purchase or refinance a home. The loan program includes single-family homes, townhouses and condos.

There are two basic types of stated-income mortgage loans:

The Stated Income Verified Assets Loan is based on your stated income, credit history and verified liquid assets. The verified assets must be consistent with the income claimed. For example, many lenders look to see that you have assets in the amount of half of your stated income.

The Stated Income Stated Assets Loan requires no verification of income or assets. You only state them on your application. This program features a slightly higher interest rate because the assets are not verified. You can find this feature on home equity lines of credit and fixed-rate second mortgages.

Similar to the Assets Loans is the No Ratio Loan program in which no income information is provided or verified on the application.

Lenders look for a minimum of two years of self-employment history. You may be able to fulfill the requirement with two years in the same line of work. The self-employed borrower may need to submit a letter from an accountant to show verification of self-employment. Two years of business licenses or confirmation from three business associates may also fulfill the requirement. Your ability to qualify for the loan is based on the income you state on the application, even though it is not verified. The lender is looking for your income to be related to your occupation.