Greg Johns

Answers to your Stated Asset loan questions

With so much happening in the housing and credit market these days, consumers are uncertain how to go obtain information regarding mortgages and or refinancing. This process is even more challenging to entrepreneurs who are pursuing the American dream and work for themselves. Although individuals who receive a salary and W-2 tend to have the advantage when it come to qualifying for a mortgage, it is not impossible to get a mortgage as a self employed individual. Stated income loans are available to self employed individuals and they are quite easy to qualify for.

What is a stated Income Loan?

A stated income loan permits borrowers to simply state their monthly income on the mortgage application instead of verifying the actual amount by furnishing pay stubs and tax returns. This method is typically intended for self employed individuals since their income is sporadic, fluctuation greatly, and is not consistent. Although this method was created for self employed borrowers with convoluted tax schedules, it has become used by other individuals because some borrowers feel it is that much easier to qualify for a loan by stating their income.

How does a stated income loan work?

There are different types of stated income loans and they vary depending on the documentation needed.

SIVA Loan- A stated income/verified asset loan requires you to state your monthly income and verify your assets (via bank statement, broker statements, deed, etc).

SISA Loan- A stated income/stated asset loan request you to state both your monthly income and your assets, so you will not have to verify the information.

Regardless of your loan type the bank or lender will verify your employment and job title by either conversing with your employer or requesting a CPA letter if you are self employed. Your job title will establish what you can claim in the way of gross earnings. Underwriters usually determine how much a certain occupation should earn so be realistic.

Does credit score matter when it comes to stated income loans?

Unfortunately or fortunately credit score does matter when it comes to any type of loan. If you have excellent credit the variety of stated income loans is very broad. Lenders perceive a person with excellent credit history as their lowest risk. Increasing your credit score by as little as 30 points could mean a lower interest rate and/or a lower down payment. If you have experienced credit difficulties you can take steps to participate in your own recovery.

Are interest rates higher on stated income loans?

Typically yes, you usually pay a premium because you are putting risk in the hands of the lender. Stated income loans are ofter .25% to .50% higher than a full documentation loan.

For more infomation on state income loans

Commercial loans in NY, Nassau County

Do you need a loan to fund your business or real estate project? The loan consultants at Americafirstcapitalmortgage.com can help. Whether your request is for working capital, financing equipment, business acquisitions or restructuring of existing debts, we can help you obtain the right commercial loan for you.

When new entrepreneurs begin a new business venture, most will need funding. Some are lucky and have money at their disposal, but most do not and will need to seek out a commercial loan for their new business. The growth of their business endeavors will depend on it. If your business is at this point you will have to decide whether you want a secured loan or an unsecured loan. It can be a difficult choice.

Secure vs. Unsecured Loans

Basically, a secured business loan is a security instrument that financial institutions offer to business owners who want to start new businesses or expand their existing businesses. A secured loan requires upfront collateral such as mutual funds, land, or a building that you own. The collateral is the most important aspect of secured business loans because it reduced the risk for the lending company. The banks feel more secure, when a loan is secured the interest rate that the borrower pays will be lower. Unsecured loans are riskier for the lender. You will not have to offer up any property as collateral but you will pay a higher interest rate on the loan.

Poor Credit Scores

If you have a poor credit score, banks are more opt to lend higher amounts to you when the loan is secured. This is a great option if you want to start a new business or expand your business and have property, but are recovering from a poor credit score. If your credit score isn't ideal, due to the current market conditions you may want to try to get your scores up to increase the chances you will qualify for one of these terrific commercial loans. Increasing your credit score by 30 points can make a huge difference in your interest rate. Check out this website for ways to improve your credit score.

Commercial Real Estate Loans:

Whether you seek funding for distressed assets, apartment, hotel, industrial or retail property loans, our service oriented brokers give you the underwriting experience required by today's tougher lending standards. Whether you are a seasoned investor or new to the market we help you explore your best options for commercial financing.

Here at americafirstcapitalmortgage.com we specialize in helping entrepreneurs obtain the capital they need to succeed. The search for commercial loans can be very time consuming and frustrating. Let us handle the financing for you.

Stated Income Loans Are Still Available in NY, Nassau County

A stated income loan requires you to STATE what your income is on the mortgage application but does require that you prove it. Meaning you do not show W-2's, pay stubs, or tax returns. The underwriter will look at the type of employment or business a borrower is in and will compare the stated income against a national salary or income guide you to providing accurate income information.

Who are stated income loans meant for? For the most part, this loan is for self employment borrowed who cannot document all of the income or shows a very low net income on the tax return. In addition, a stated income loan is great for a person who earns some salary but also cash that is not documented anywhere. One other type of borrower who may opt for a stated income loan is some one who collects rental income but does not have a signed lease to verify that income stream.

What home buyers don't realize is there are still stated income loans available for both purchases and refinances with loan to value as high as 70% (this percentage is calculated by taking the loan amount divided by the lower of purchase price or appraised value). Loan to values are typically driven by the loan size, credit score, purpose of residence (single family, multi family, investment properties), ability to provide verified assets and continuous work history. Stated income loans are available up to 3 million with strong compensating factors mentioned above. We happen to work with lenders in the northeast who provide excellent rates for stated income loans in New York. For more information about stated income loans please call Greg Johns @ (516)425-7555 or visit my website americafirstcapitalmortgage.com.

Mainly you have 3 types of stated programs:

1) NO MINIMUM CREDIT SCORE- However the loan must make sense along with being supported with the following criteria: a) 6 months of assets and reserves b) 2yr of continuous SELF EMPLOYMENT verified by a CPA letter c) a 1/3 to 1/2 annual income needs to be in liquid reserves (not 401k or qualified money -IRA's, Keough, Annuities). This program is driven by Loan to Value TV

2) INVESTMENT PROPERTIES - For 1 to 4 Families, Condo, and PUD, verification of business license for Self-Employed, will require reserves (6 months) and Business Bank Statements to show that business is still in place. This program is driven on Loan to Value and Property Type.

3) NO INCOME/NO ASSET - No income/no asset loans are still available from minimal amounts to a 3 million dollar jumbo loan. For example, currently you can get a 3 million dollar loan if your credit score is 740 or above as long as this home is your primary residence at a 70% loan to value. If your credit score is below 740 then you would get lower loan to values.

The true purpose of a stated income loan was and will always be for the individuals who are entrepreneurs. If you are an individual who is weathering the current market conditions by maintaining strong credit, showing the ability to pay yourself (in the form of savings/reserves), and has demonstrated fiscal responsibility, these three factors will give you the oppurtunity to qualify for a stated income loan because they ARE available.

If your credit isn't ideal, due to current market conditions you may want to try to get your scores up to increase the chances you will qualify for one of these terrific stated income loans. Increasing your credit score isn't as tough as you might think. Even 30 points can make a huge difference in interest rate and possibly lower the down payment. Check out this website for ways to improve your credit repair.