Chase No Income Verification Mortgage - Empowering Your Financial Journey

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Lenders are increasingly providing no-doc mortgage options to assist borrowers with loans to purchase or refinance homes in difficult financial situations. A no-doc mortgage, also known as a stated income loan or no-income verification mortgage, could speed up the closing of your home loan, particularly if your tax returns are complicated.

Modern no-income-verification mortgages offer more consumer protections than conventional home loans, making them a competitive option.

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Modern no-income-verification mortgages offer more consumer protections than conventional home loans, making them a competitive option.

What is a no-income-verification mortgage?

A mortgage with no income verification is one that doesn’t require the usual loan documentation, such as pay stubs, W2s, or tax returns. Despite the name, a no-doc loan does require some paperwork to be obtained. Other documents, like bank statements, are accepted by the lender as evidence that you can pay back the mortgage.

Compared to stated-income loans, which were common before the housing crash of 2007 and 2008, modern no-doc mortgages are different. Said income loans, which were primarily for self-employed borrowers, previously permitted applicants to essentially “state” whatever income was necessary to qualify. Lenders must now demonstrate that borrowers who take out no-doc mortgages have the financial means to repay the loans.

How no-doc mortgages work, and who they work for

Numerous no-document and low-document mortgage products are available from no-document mortgage lenders. The most popular programs are broken down below, along with information on who can use them.

BANK STATEMENT MORTGAGES

In order to determine your income eligibility for a loan, lenders gather and evaluate the deposits on 12- to 24-month worth of your personal or business bank statements.

Who they work best for: Clients who regularly receive deposits that can be easily monitored on their bank statements.

ASSET-BASED MORTGAGES

These are frequently referred to as asset-depletion loans, and lenders will determine your eligibility using up to 100% of the value of your liquid assets divided by the length of the loan. For instance, a borrower could apply for a 20-year fixed asset-depletion loan with a $1 million asset. $50,000 a year ($1 million divided by a 20-year term) would be the qualifying income.

Who they’re best for. For asset-based mortgages, high-net-worth borrowers who have money in accounts that can be quickly converted to cash work best. Customers with substantial deposit balances may be offered them by institutional banks.

NO-INCOME, NO ASSET LOANS

Only if you’re purchasing an investment property that generates enough income to cover the monthly mortgage payment are no-income, no-asset (NINA) loans currently available. If the property’s monthly rents are equal to or slightly higher than the total monthly payment, these loans, also known as debt-service ratio loans, don’t need proof of income or assets.

Who they’re best for. Real estate investors looking to quickly assemble a portfolio of investment properties and have the cash on hand for substantial down payments

No-doc mortgage requirements vs. other types of mortgages

Check to see if you meet the minimal mortgage requirements prior to applying for a no-doc mortgage.

for the most common standard mortgage programs. Borrowers often choose conventional.

due to the low down payment requirements, or FHA loans (backed by the Federal Housing Administration).

Conventional loans adhere to rules established by Freddie Mac and Fannie Mae. FHA loans are more lenient than conventional loans. Normal down payments and credit scores for no-doc loans are higher than those for conventional and FHA loans.

The standard requirements for each loan type are compared head-to-head in the table below.

How do I get a no-doc mortgage?

The phrase “no-doc mortgage” does not imply that lenders lend money to anyone. Actually, no-documentation mortgage lenders are required to make an honest effort to demonstrate that you can repay the loans they offer. Therefore, they will request additional evidence that you can make the payments.

Below are four common requirements for no-income-verification mortgages.

HAVE GOOD CREDIT. No-income-verification mortgage programs generally require a higher credit score than a regular loan with income documents.

MAKE A LARGE DOWN PAYMENT. The down payment minimum on no-doc mortgage loans usually starts at 20%.

EXPECT HIGHER INTEREST RATES. Lenders may charge higher rates than you’d pay for a regular mortgage to cover the higher risk of forgoing documentation.

PROVE YOU CAN REPAY THE LOAN. Whether it’s bank statement deposits, rent on an investment property you’re buying or a large stockpile of assets, lenders need proof you have the resources to make monthly payments on your loan.

Pros and cons of a no-doc mortgage

If you have complicated tax returns, can’t easily verify your monthly income, or simply don’t want to deal with the hassle of submitting a ton of income documentation, you should think about applying for a no-income verification loan.

Self-employment income isn’t guaranteed by an hourly or salaried salary, so lenders take extra precautions to confirm a borrower’s history of earnings. They put a lot of emphasis on the consistency of the income, how financially stable the company is, and even the level of demand for the kind of services or goods the business provides.

In the following situations, you might want to think about a loan with no income verification:

You had business expense write-offs last year. Large expense write-offs like equipment or commercial property purchases may push your net income down. Lenders evaluate a two-year history when averaging self-employed income. The low year of earnings due to the write-off could affect your approval chances with a standard mortgage.

Your income declined recently. A drop in income may set off lender alarm bells with traditional lenders, especially if you’re self-employed. A no-doc home loan program allows you to get a mortgage without tax returns that show declining income.

You file multiple tax returns. The more streams of income you earn, the more complicated your tax returns are likely to be. As a result, a no-tax-return mortgage might be a viable alternative.

You have an irregular income. Freelance workers and seasonal contractors may get lump sums of money a few times a year. A no-documentation mortgage lender may be able to help if a traditional lender can’t figure out your income.

You’re a real estate investor. Ability-to-repay rules apply only to mortgages for primary residences and second homes. Investors might qualify for a no-doc home loan program on the basis of projected rent for the property they’re buying without any other asset or income documentation.

You have a high net worth but no job. If working is no longer necessary because you’ve reached a high net worth, a no-doc mortgage loan may allow you to convert your assets into qualifying income.

Stated-income loans, NINJA loans and other types of no-doc mortgages

You might encounter any of the following no-doc mortgage variations:

Stated-income loans. Stated-income mortgages don’t use a W-2, 1099, bank statement or other source to verify the applicant’s income.

SISA. Stated-income, stated-asset (SISA) loans are made without verification of a borrower’s income or assets.

SIVA. Stated-income, verified-assets (SIVA) loans allow lenders to accept your assets and your word about how much you earn as the basis for approval. They’re often called bank statement loans.

NIVA. No-income, verified-assets (NIVA) loans are similar to SIVA loans, except income is not added to the application. Instead, lenders may review assets such as retirement and savings accounts.

NINA. NINA loans may be an option for real estate investors buying rental properties. This type of no-doc mortgage requires enough rental income to cover the new mortgage payment.

NINJA loans. No-income, no-job, no-asset (NINJA) mortgages don’t require lenders to verify income, assets or employment. Essentially, with a NINJA loan, the lender takes the borrower’s word that the loan application is accurate.

Are you eligible for a government-backed, no-doc refinance mortgage?

For the purpose of refinancing government-backed mortgages, qualified borrowers may use no-income-verification mortgage programs. Homeowners who have made on-time payments over the previous year and whose loans are backed by the FHA, the U S. Department of Veterans Affairs (VA) or the U. S. A loan with fewer documents may be available to the Department of Agriculture (USDA). A benefit of these programs is that you won’t require a home appraisal.

FHA streamline. Homeowners with an FHA loan may be eligible to get a better interest rate or better terms without any income documents through the FHA streamline refinance program. One drawback, however, is that closing costs can’t be rolled into the loan amount unless you agree to a higher interest rate.

VA IRRRL. Military borrowers may be able to get a lower mortgage rate with the VA’s interest rate reduction refinance loan (IRRRL) without providing earnings paperwork. The loan amount can be increased to cover closing costs.

USDA streamlined assist-refinance loan. If you bought your rural home with a no-down-payment USDA loan, you might be able to reduce your rate with the USDA streamlined-assist refinance option. No income docs are needed, and you can add the closing costs to your loan amount.

Are no-doc loans safe?

Since no-documentation mortgage lenders are required by law to verify your ability to repay the loan with proof of cash flow or assets, they are safer today than their stated-income counterparts. However, every mortgage carries the possibility that you could lose your home if you are unable to make the payments.

Loans with a stated income were designed to assist people with varying self-employment income in purchasing homes. However, lenders accelerated approvals and closed more loans by taking advantage of the simple qualification process.

When the housing market crashed and the U. S. when the Great Recession began, many homeowners experienced job losses or mortgage debt defaults. Many people lost their homes to foreclosure after failing to make loan payments.

THINGS TO KNOW

The Consumer Financial Protection Bureau enforces ability-to-repay laws to make qualified mortgages in order to safeguard consumers from future loan abuse. Mortgages that are qualified must adhere to minimum debt-to-income (DTI) ratio standards and provide regular income documentation. This guarantees that you earn enough each month to pay off all of your debts in addition to your new mortgage payment.

Compare Multiple Prequalification Offers Loan type:

Any loan that is not federally guaranteed is classified as a conventional mortgage. Learn about the different types of conventional loans that exist.

Jumbo loans are even more extreme than high-balance loans, which give you more borrowing power; both can be conventional.

Before contacting a lender, review our comprehensive overview of the minimum mortgage requirements by loan type to understand how to qualify for a mortgage in 2023.

FAQ

What credit score is needed for no income verification mortgage?

The following are the minimal requirements for a no-income-verification loan: A credit score of at least 700 the capacity to put down a sizeable deposit, frequently 20–30% or more Provide documentation that shows your assets and income.

Can you get a mortgage with no income history?

Yes, without a doubt: A lot of people, including retirees, those who have recently divorced, and those who have a lot of money in the bank, receive one every day. As long as lenders can confirm that you will be able to repay the loan, it is actually very likely that you can obtain a mortgage without having a job.

How does Chase verify employment for mortgage?

Pay stubs: Written confirmation of direct deposit or printed copies that show at least 30 days of income Social Security: If deposited electronically through direct deposit, a copy of the award letter must be submitted along with a recent check stub or a copy of a bank statement.

How much do you have to put down on a no income verification loan?

Mortgage programs requiring no proof of income typically demand a higher credit score than conventional loans requiring proof of income. MAKE A LARGE DOWN PAYMENT. For no-doc mortgage loans, the minimum down payment typically begins at 20%. EXPECT HIGHER INTEREST RATES.