No
Income Verification Home Equity Loans
By
Levetta Rivera
A no income
verification home equity loan is a second
mortgage loan that does not require you to provide
income documentation to qualify for the loan. This
type of loan is great for homeowners who need a home
equity loan but have hard to document income.
The majority of
borrowers with hard to document income are either
self-employed or commission based employees.
Consumers who fall under these categories may have
high income but have a lot of business related
deductions that they write off on their taxes. This
is good on the one hand as it reduces the taxable
income and thus the amount of taxes owed, however,
when it comes to getting a home loan it can hurt as
most lenders use the average of your last 2 years
taxable net income (the amount left after all of your
deductions) to determine your income figure for
qualifying purposes. This may cause you to have a
debt to income ratio problem if you have a high debt
load and thus keep you from qualifying for the loan.
With a no income verification home equity loan,
however, your gross income can be used for qualifying
purposes as opposed to the net income.
In order to qualify
for a no income verification home equity loan you
will, in most cases, need good credit and a high
credit score. Expect to pay a higher rate
for this type of loan as opposed to a traditional
loan in which you have to document your income. Also,
even though a no income verification loan does not
require you to document your income, some lenders may
require that you have a certain dollar value of
assets on hand which must be verified. Not all
lenders have this requirement though - some lenders
offer a program called NINA which stands for "no
income no assets" meaning you do not have to
document either. Loan guidelines and rates vary from
lender to lender so it is a good idea to shop around
to increase your chances of getting the best deal
available to you.
______________________________
About
the Author
Levetta Rivera
is a successful mortgage broker and publisher of the
following financial websites: http://www.equityloansource.com and http://www.militaryvaloan.com
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