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FULL QUALIFYING LOANS
These loans require verification of both your income(s) and your cash assets. You will obtain the lowest interest rate available due to the amount of information we have available to assess our risk.
You may put as little as a Zero down payment, although a 20% down payment is required to eliminate Private Mortgage Insurance coverage. We have additional programs to eliminate PMI in an 80/20 format.
Your credit report and related credit score will be evaluated along with your debt-to-income ratio to evaluate credit worthiness.
A good rule-of-thumb is, the better the credit, the less down payment will be required and the lower the interest rate will be. The poorer the credit, the more down payment will be required and the higher the rate will be.
LIMITED DOCUMENTATION LOANS
These loan types eliminate the need for verifying your income and/or your cash assets. Considerable weight will be placed upon the quality of your credit. These loans come in several different categories.
"Stated Income" loans require you to state your income on the loan application, but you do not need to provide pay stubs or W-2 forms. A stable two-year work history is normally required, or, if self-employed, you must evidence that your business has operated for at least two years. The income listed must be "in line" with the job position and assets that you have listed.
These loans may be obtained with as little as a 5% down payment if you have a 680 or above credit score. A 10% or 20% down payment will be required if your credit score is between 600-680.
"Stated Income/Stated Asset" loans, known as NINA (No Income, No Asset verification), allow you to state both your income and your cash assets on the loan application.
These loans require a minimum credit score. The better your credit, the less down payment will be required. Down payments will range dependent upon your credit.
"No Verification" loans are available for borrowers with an above average credit score. You will not be required to provide information on your income, assets, or on your employment history.
"12 or 24 months bank statement" These loans use an average of deposits and or balances over the schedule program time line to establish your monthly income to qualify.
All three of these categories of Limited Documentation loans will carry higher interest rates than a "full qualifier". The rate increase can vary from as little as .125%, to as high as 2.00% or more, above current market rates dependent upon your credit rating and the amount of your down payment.
Glossary Of Terms |