Things to Know About the No Income Verification Loans and Mortgages

There have been positive developments in the recent years for commercial borrowers seeking no income or stated commercial loans and commercial mortgages in the U.S. Getting no income verification funds has become hassle-free for the borrowers who have no stable income but have good credit score.

When it comes to a business loan, there are a number of reasons why you should consider a funding source other than a bank. If you don’t have a stable source of income, it could be very difficult for you to secure a business loan from the traditional bank.

No income verification loan is a good option for the self-employed and small businesses who can’t show enough income on their tax returns to qualify for the traditional financing options. This post provides a brief overview of the no income verification finances, their benefits, and limitations.

Who needs no income verification finance?

Due to the rigorous documentation and approval process, many investors and borrowers find it hard to qualify for traditional commercial loans. No income verification is an ideal financing solution for such individuals. New businesses, contracted personals, self-employed, unemployed, seasonal workers and new immigrants often require no income verification finance to meet their financial needs.

Who can provide a no income verification loan?

Some lenders in the US provide no-income verification finance to the real estate investors and other borrowers. No verification loans are offered at much higher interest rates by the lenders due to the high risk associated with them. If you want no verification finance but are not sure about the benefits and risks associated with it, then you can get in touch with the experienced real- estate brokers. They can help you choose a right kind of commercial loan that suits your precise financial needs.

Benefits of availing no income verification finance

Minimum documentation

One of the primary benefits of no income verification financing is that the real estate investors and other borrowers require less documentation than a bank. However, the level of documentation varies from the lender to lender.

Easier approval process

The no income verification mortgage has an easier approval process as compared to traditional banks in the US. It does not have to be underwritten to both - the property cash flow and a secondary repayment source such as the borrower’s personal income.

Limitations of no income verification finance

One of the major limitations of no income verification finance is that it has higher interest rate as compared to traditional commercial loans provided by the banks. In addition to this, such type of commercial finances has shorter repayment periods as compared to the loans provided by the banks in the US. The interest rate in no-income verification finance depends on the lenders and the creditworthiness of the borrowers. In order to avail such loans, borrowers need to deposit more down payment. Some lenders may ask a deposit of 25-30% as down payment in order to approve the loan.