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A NINA (short for No Income, No Asset) loan is where the borrower does not have to disclose income or bank statements on the application.
Only borrowers with strong credit will qualify for this type of loan. Also, expect to pay a higher interest rate and be limited to a lower LTV or loan to value.
The NINA loan program is perfect for borrowers who are self-employed who may not be able to document their income for any reason.
No Income No Asset loans can be a great alternative to stated income loans.
With this program, you will still likely be required to verify that you do have a source of income. One way of supplying this information is through a Verification of Employment, by which your employer verifies that you are an employee of their company. Other options, for the self-employed, include providing a copy of your business license or a letter from your Certified Public Accountant stating that you do generate income.
NINA loans are sometimes referred to as no doc loans, however "true no doc" loans are sometimes further defined as NI NA NE for No Income, No Assets, No Employment documentation. These loans are ideal for borrowers who have difficulty substantiating employment, including the recently retired, and borrowers who have started their own business within the last 12 to 24 months
With a stated loan you are required to show proof of a job, your job history, and you need to list your true income on your loan application. The reason why people do stated income loans is for reduced income documentation. With a stated income loan you are not required to show W2's, pay-stubs, tax returns, bank statements, etc... to show proof of your income. The bank is trusting that you are listing your actual income on your loan application. Usually a stated loan will carry a little bit higher rate than a regular full income documentation loan and the qualifying requirements will be a little tougher as well. However, if you do not actually make as much money as you are stating on your loan application and you are lying about your income a more appropriate loan may be a NINA, No Income, No Asset type loan. With this type of loan you do not have to disclose an income amount on your application at all. While your job will still be verified, to make sure you actually do have a source of income, there will be no income verification and there will be no income even listed on your loan application at all. NINA loans will carry even a higher rate bump than stated loans because of the higher risk in these types of loans. These types of loans are good for people who are self-employed and make a lot of money but write off a lot too. NINA loans are also good for people whose incomes may be just a little higher than the permitted DTI, debt to income ratio, on a certain program. NINA loans can also be good for people who have other sources of income, in addition to their primary jobs, that can not be documented or would not be accepted by a lender. Consult your mortgage professional to find out which mortgage loan program is best for you.
If you have excellent credit and are seeking a lower LTV loan amount, this loan may not cost you any more than a full doc loan.
» DISCLAIMER: The information contained in this article on 'NINA Loan' is a collection of contributions by licensed mortgage professionals and is not the opinion of Broker Outpost LLC. Always consult a licensed professional before applying for a mortgage.
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