At Lending Bankers Mortgage, our goal is to find a way to help every customer who contacts us to obtain the financing they need for their commercial and residential needs quickly and easily.
For that reason, we offer convenient loan financing options which you may not find at your regular bank or credit union, like stated income loans. With a stated income loan, you do not need to verify your income using W-2 forms or pay stubs.
Tips When Applying for Stated Income Loan
If you’ve never applied for a stated income loan, here a few things you should know before you get started.
- You still need to prove your income with a stated income loan. The phrase “stated income” is a bit misleading in that it is not meant to not be taken literally. You cannot simply declare your income to be a certain amount without backing it up. You do not need to provide pay stubs or W-2 forms, but you do need to verify your statement through other means. Typically, that means using bank statements. How many months’ worth of statements you need to provide varies from one lender to the next. But it is usually somewhere between 12 to 24 months of bank statements.
- The down payment for a stated income loan may be higher. It is common for lenders to demand a higher down payment for stated income loans than they do for loans which are verified through traditional paperwork. This could be as high as 25%. So before applying, you may wish to save up for your down payment. This also will give you an opportunity to save up some reserve cash. A lot of lenders look for 6-12 months worth of cash reserves.
- You are expected to verify your employment(or self-employment). If you are employed by a company, this is straightforward enough. What if you work for yourself? This does not remove the need for verification—but obviously you cannot simply verify yourself. What you can do is provide a letter from your CPA or another qualified third party.
- Applying for a stated income loan can cut back on paperwork and time. While many people apply for stated income loans because they simply cannot provide W-2 forms or pay stubs, this alternative loan application process offers other benefits as well. For one thing, less paperwork means less hassle. For another, it means less time. A stated income loan can cut back on stress and help to speed up the entire application process. This can be extremely helpful in a fix-and-flip situation or other reasons to want to accelerate the process.
Finally, one more advantage of stated income loans is that allow you to exercise greater discretion over your own finances. When you apply through the traditional loan approval process, whether or not your application is accepted ultimately comes down to whether the lender thinks you qualify based on their formulas and models.
Those formulas may apply to borrowers in the middle of the bell curve, but they may not be applicable to your financial situation. While you can attempt to explain this, many traditional lenders simply will not be willing to listen. They are not used to working with customers in your shoes, and lack the experience or perspective to grant your request for consideration.
Applying for Stated Income Loans
Apply for a stated income loan today through Lending Bankers Mortgage. We know how frustrating it can be to apply through a loan through the traditional process only to be rejected because you cannot furnish a W-2 or prove you can afford a loan through formulas that do not fully account for your financial situation.
With our network of more than 130 lenders throughout South Florida, we can bring you competitive interest rates and down payments on stated income loans. Whatever your financial situation, there is a loan product out there which is an ideal fit for your needs.
Ready to apply for a mortgage today without a W-2 or pay stub? Give us a call at (786) 220-1100, and we will schedule your free consultation!