No Income Verification Mortgages

A guide to new non-QM products

What is a no-income-verification loan?

   Under conventional, FHA and VA underwriting guidelines an applicant's income must be verified by obtaining direct verification of employment and income from the applicant's employer, obtaining copies of the applicant's pay-stubs and W-2's and copies of the applicant's tax returns in some situations. A no-income-verification loan program is one that does not require the borrower to provide this type of documentation.  After the “implosion” of the mortgage industry during the mid-2000’s the investment sources offering these types of loans disappeared from the mortgage landscape.  During 2013 new investment sources offering loans featuring these more liberal documentation requirements approached AmeriFund offering to make these types no-income verification loans and other types of “subprime” loan programs available to AmeriFund’s customers. These non-conforming and sub-prime loans have much higher interest rates than conforming and government insured loans, starting at about 7% per annum.  However, AmeriFund does have conventional loan programs requiring reduced documentation. For example, most lenders require a borrower to have been on the job for a minimum of 2 years or in the same line of work for 2 years to use an applicant's income for qualification purposes. Under our company's EZ-Doc loan program we can often approve an application submitted by an applicant that has just started a new job, even where the applicant has no prior experience in that industry.

Is the EZ-Doc program available to applicants who have commission income or who are self-employed?

Applicants who receive all or a portion of their income from sales commissions or self-employment income may benefit from the reduced documentation requirements of our EZ-Doc “reduced” and “no-income-verification” loan program.  Most lenders require a 24 month history of receiving commission income or self-employment income to utilize that income for qualification purposes. Under our company's EZ-Doc program an applicant may qualify with as little as 6 months of commission or self-employment income.

Are there reasons why an applicant would not want to utilize the EZ-Doc loan program?

There are several reasons why an applicant that can qualify under our standard documentation requirements would want to do so in lieu of using the EZ-Doc program. The interest rate which an applicant will receive on an EZ-Doc loan will usually be somewhat higher than the rate that could be obtained on a standard documentation program. Furthermore, an applicant applying for a loan under the EZ-Doc guidelines may be limited to only a handful of fixed-rate and adjustable-rate loan programs.

Are there alternatives for applicants who do not have the requisite period of commission, bonus, overtime or self-employment income or who have no current source of income?

Yes. Applicants that have lots of liquid assets but cannot verify receipt of income can sometimes utilize the income or potential income from these assets for qualification.

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