No Doc Mortgage - NY Mortgage

No Doc loan, or No Documentation mortgage, is a type of mortgage program offered to
home buyers who cannot document their incomes, assets, employments. It requires the least
amount of paper work from the borrower among the different types of mortgages. The name
No Doc is a little misleading, after all, the borrower's credit report and property appraisal are
still examined.

On the loan application, the sections regarding the loan applicant's income, employment,
bank accounts, retirement accounts, personal debts, car payments, other monthly
obligations, etc. are left blank. No paycheck stubs, W2's, tax returns, bank statements are
submitted with the loan application. The borrower's employment is not verified. Loan
underwriting is based only on the applicant's credit scores and whether the appraisal report
supports the property value.

Because of the risky nature of No Doc home loans, banks usually require the home buyer to
put up a bigger downpayment. To avoid layered risks, the highest Loan-to-Value ratio
allowed is often 80%, that is, most banks only lend up to 80% of the value of the property.

The applicant's ability to repay the mortgage is not evaluated. The Debt-to-Income ratio,
which lenders use to gauge a borrower's repayment capability, is not considered.

Because of its lack of documents, No Doc home loans take the shortest amount of time to
underwrite.

Home buyers who use No Documentation loans pay a higher price for the simplicity and
convenience this loan offers. Interest rates of No Doc mortgages are about 1.5% higher
than Full Doc mortgages.

Applicants need not to have perfect credit profiles for No Doc home loans, but many banks
do not qualify home buyers with low credit scores. If a borrower has poor credit, his choice of
lenders is limited and often has to settle for a higher interest rate.









					Registered Mortgage Broker - NYS Banking Department. Loans arranged through third party providers. This is not a commitment to lend. Loan programs subject to change without notification. Equal Housing Opportunity.