No Doc Loans - A No-Doc loan allows the borrower to apply for a loan and not have to state their income, employment, assets or even submit bank statements. This type of loan is often time appealing to Self-employed, single women who do not have the required two year track record and many successful entrepreneurs who simply don’t want to reveal how much they make. In doing a No-Doc loan the borrower will have a one percent higher rate on average than most conventional loans.

No doc loans are often confused with stated income loans but there is a difference.

In a stated income loan the method of earning income must be proven but the borrower is allowed to simply state the amount of that income without providing any proof.

A no doc loan means that no documentation at all regarding the amount or the method of earning the income is required.

In some cases a lenders guidelines for a no doc loan even waive the need for a full appraisal, or the requirement that the borrower have the property for at least 12 months before refinancing. This is a usefull program for investment property owners who need to draw cash out of the equity of a property that was rehabilitated. Most lenders will not use the new appraised value with out additional documentation and "seasoning" of the property for at least 6 months and usually 12 months.

Indidivuals who live off of equity and debt investments very often have no means of verifying employment or income due to a variety of factors, and are excellent candidates for no-docs / NINA type loans.

No doc loans are much easier to process than the normal loans. There is very little paper work in comparison and not much to verify.

There are lenders offering 100% no-doc loans, but to qualify you must have excellent credit and reserves. Often times this is limited to borrowers who have owned property in the past.

Past credit history and credit score is very important when applying for a no documentation loan since the lending decision is based on extremely limited information.

A NO-DOC loan is good for borrowers who just relocated, or have recently went self employed.

No Doc loans require the least documentation and are for buyers with good credit. The buyer provides minimal information and the lender does the rest. No Doc loans are great for people who want maximum privacy.

In a soft real estate market, homeowners with no equity in the homes are much more like to default on their mortgages. Because of the intrinsic risk of default associated with No Documentation Loans, most lenders require that the home buyer commit a bigger down payment towards the property.

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