Why Do You Need a Stated Income Mortgage?

There are many ways to purchase a home. Of course you may need a down payment along with a mortgage. There are many different types of mortgages that you can apply for depending on your financial circumstances.

If you have a typical office job with documented proof of income such as pay-stubs, W-2’s or 1099 forms, you

can easily apply for a mortgage loan from a local bank. However if you are an individual that owns a business or has any other alternative source of income it may be harder for you to be approved for a mortgage loan.

For example, as a small business owner you know it is hard to supply a proof of income. When securing a loan you may be able to supply tax returns or bank deposits. However according to most reputable banking institutions, supplying tax returns or bank deposits are still not enough to prove a stable income.

Government-instituted banks want to know if your income is stable enough to pay off your loan payment every month. They see your profession and fluctuating income as a “high risk” situation. Due to your uncertain fluxes in income, banks do not wish to be held responsible if you have to default on your mortgage.

Here’s the dilemma: You are a real estate agent and see a dream of a house that you would like to buy. You have only been in business a little over a year. Therefore you cannot even supply the common 2 years worth of tax returns. You have made regular deposits to a checking account and hope that the deposits will be enough to be approved for a loan. Unfortunately the mortgage options available at your local banks are stringent about checking proof of income, and will not accept any bank statements. What do you do?

This situation doesn’t sound fair, but you still have a chance to turn your dream home into a reality. Forget typical banks for the moment and apply for a stated income mortgage loan instead.

  

What is a stated income loan? 

A stated income mortgage loan is a home loan that requires no proof of income other than the income you officially claim or state. The income you claim is the income you have according to the mortgage lender. And the amount of money you receive will be based on the amount of income that is stated.

A stated income loan is also known as an alternative or no-doc loan, which ultimately means “no document”. Yes “no documents” are needed, as in the official documents typically used to prove income at a banking institution.

 

This is perfect for borrowers that have the ability to pay off a loan but are in a complicated financial dilemma – they are self-employed, they are business owners, they are real instate/investment agents, etc.

Of course it is best to apply for a stated income mortgage if you know you are able to pay off the loan within its intended time frame. Considering most individuals that apply for a stated income loan are simply unable to supply proof of income, this shouldn’t be a problem. However it is advised to only claim the amount of income closest to what you’ve made in the past. If you cannot estimate past income, make an educated assumption of future income.

Are you self-employed and having trouble getting approved for a home loan?

Consider applying for a stated income mortgage loan.

Pick up the phone and contact Dennis at Level 4 Funding:  623-582-4444. As the home loan experts in Arizona, we will give you the advice you need to get approved.

Level 4 Funding LLC

23335 N 18^th Drive Suite 120

Phoenix AZ 85027

623-582-4444

www.Level4Funding.com