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Are you in need of finance but have problems in arranging
or your income proof and other employment documents. If this
is the case then you can apply for the no doc loans. The no
doc loan is also called as the stated income loans. With the
help of these loans people who have a good credit standing but
do not have a regular source of income. In this article we will
be talking about the no doc loans and how to apply for them
and get them approved easily.
The no
doc loan is usually meant for homeowners that have problems
in arranging for proper documentation for their income. However
to qualify for these loans you are required to have a good credit.
Another aspect of these loans is that you would have to compromise
on the interest rate and pay a higher interest rate because
the lender takes a risk in not checking your income documents
and assuming that you would be able to payback the loan on time.
The lender takes more risk with these loans as compared to the
conventional mortgages and hence charges a higher interest rate.
If you are willing to apply for these loans then you are required
to do some constructive research. You are required to search
for the best deal that would be available for you. When you
apply for the no doc loan you would just have to give information
about where are you getting your income from? The lender would
typically conduct a credit check on your credit history. Usually
lenders that give out the no doc loans require the borrower
to have a credit score of approximately 680. But with the increasing
competition in the market the lenders can even give concessions
on the eligible score.
If you are self employed or are working on commission basis
then your two years bank statements would be enough to prove
your source of income. Apart from this you would also have to
provide the details of your income tax returns for the past
2 years. Shopping around for the right kind of no
doc loan can
help you save a lot of money. Even a slight change in the interest
rate can help you save a lot of money. When selecting the no
doc loan you should compare the total cost of the loan. Besides
this you should also compare the prepayment penalties of the
loan.
When shopping for the no
doc loan you should be smart. Make
sure that you do not allow the lender to access your credit
report unless you are ready to apply for the loan. This is advised
because if too many credit enquires are made in a short period
of time then it can result in damaging your credit score. Even
before you start looking for the no doc loan you should look
into your credit report. It is very important that you assess
your credit score before applying for no doc loans. This is
suggested because the no doc loans are given out to people with
a good credit score.
Apart from the conventional lenders there are a number of online
lenders that would provide no doc loans. It is advised that
you look out for the online options because these lenders would
be able to provide you with better options at times. The online
lenders provide a good option and also would give people with
an option of applying for the loan easily. Apart from the feasibility
of applying for the loan easily the online loans are processes
fast as compared to the conventional loans.
Before taking the no
doc loan it is advised that the borrower
read the terms of the loan carefully. There are a number of
lenders that would readily offer no doc loan. You are just required
to look for the right option for yourself. When choosing the
lender for the no doc loan it should be taken care that you
are getting the best deal. Hence it is advised that you compare
the different offers that are available for you and then take
a decision on which would be the best option.
The fees and the terms and conditions would vary from one lender
to another hence it is important that the borrower applies for
the no doc loan after comparing the offers from various lenders.
It is advised that the refinance home mortgage loans be spread
over a long period so that the monthly payments are low. However
it should be understood that when the payments are lower but
spread over a long time you would have to pay more towards the
interest rate on the loan. Hence it is advised that you look
out for all the options and then apply for the no doc loan.
When comparing the loan quotes from different lenders it is
advised that the borrower compares the APR (Annual Percentage
Rate) rather than just comparing the interest rates. The APR
of the loan would give you the total cost of the loan on an
annual basis. The APR is inclusive of the interest rates and
the fees. However, even when comparing the APR you should ask
the lender about the fees that have been included in the APR.
The lenders calculate the APR differently. According to the
Truth in Lending the lender is required to reveal the APR to
the borrower before he signs up for the loan. Hence it is advised
that you take the no doc loan after much consideration.
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