Alternative income verification loans are mortgages which involve lenders who do not utilize conventional documentation to validate the income of a borrower. Some refer to these loans as low-doc or no-doc loans.
Participants who desire to borrow capital via these types of loans are typically self-employed (such as owners of small businesses), while some are simply investors with income-documentation issues.
Relative to small business owners, these loans are great when business growth cannot be seen in a previous year’s financials, which also may not be finalized and can show a big expense that a business may no longer be paying.
Through alternative income verification loans, borrowers are allowed to present non-traditional forms to verify their income to prove they’re capable of repaying a loan. Furthermore, these loans can possess stiffer protocols than traditional loans, including greater requirements for liquid assets.
Alternative income verification loans are ideal for borrowers who are self-employed to purchase or refinance a property minus the need to present their bank statements and tax returns. Even those who are in the low-income category can find alternative income verification loans more beneficial than many traditional loan programs.
These loans are harder to acquire, however, as many lenders of who offer them prefer a large down payment and good credit. Interest rates are also found to be higher for borrowers.
Among the most important steps a person can initially take when attempting to procure an alternative income verification loan is to factually state their income. It’s highly advised to borrowers to not falsify or inflate their income, and be upfront and honest about their debts when submitting an application.
Next, borrowers should examine the full price of a property they’re requesting an alternative income verification loan for, including all additional fees and costs, such as various taxes and insurances, plus the inclusion of utilities, maintenance and more.
Associates Home Loan of Florida gives great consideration to a client’s individual needs regarding any type of loan, including alternative income verification lending. Our clients can rest assured they will be presented with a variety of options to be equipped to make a well-informed decision that suits their needs.
Please call (866) 257-9476 today so we can get started with helping you secure an alternative income verification loan!