Applying for a stated income mortgage loan

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A stated income mortgage is a low or no documentation loan in which the loan is approved without any documented proof of your income. They usually carry higher interest rates than conventional mortgages. The borrower must posess a mid- to high-level credit score and should have assets equal to at least six times the stated income.

There are quite a lot of people in our society who don't get a fixed monthly income. Many people who work on commission or are self-employed cannot prove their monthly income. A lot of others don't want to disclose their income to a bank. A stated income mortgage loan will be an ideal choice for these people.

The borrowers are required to disclose their two year employment history and will have to state a figure for their monthly income in the mortgage application form.You must provide your social security number since your credit worthiness is based almost entirely on your credit score. To qualify for a stated income mortgage loan, the potential borrower should have a FICO credit score of above 600, but some lenders offer loans to people with credit scores as low as 500. The lender may also ask you to disclose some details such as bank accounts, your retirement programs etc.

Usually, the interest rate will be at least half a percentage point higher compared to conventional loans. Besides, a stated income mortgage loan requires you to have a down payment of at least 25 percent of the property's value.

The best place to find a potential stated-income mortgage lender is the internet, where you can compare the rates offered by various lenders and choose the one that is best suited for you.