Stated Income Commercial loans are a substitute for the normal method of commercial lending. This category of loan is a very good option as an alternative to a traditional commercial loan. This usually is taken up by those borrowers who are looking for refinancing on their property.
The crux of stated income relies upon the value of the real estate. The lender doesn’t look at the credit history of the borrower. Rather, they focus on the piece of real estate that the borrower wants to buy or refinance. In this category, the lender doesn’t verify the income statements of the borrowers. They rely on the word of the borrower. This is why this category is also known as liar loan or liar’s loan. You don’t need to present your IT returns, forms, beneficiaries, and other income evidence.
The Concept
This stated income loan is a no document loan. This is highly useful for professional real estate investors who want to invest for a short period. He can attain capital in a small period. The stated income loan eliminates the limitations of bank lending. Bank loans involve a lot of hassle. There is a lot of documentation involved. The process to get the money is very long. Bank loans also involve checking the personal income of the borrowers as well.
This is why many people are not eligible to get bank loans. Stated Income Commercial loans are much easier to get for these people. There is the ease of rules and regulation in the stated loans. This is something that cannot be witnessed in bank loans. The best part about these loans is that you can always take the advantage of a good market opportunity. If you come across a good property at a good price then you can easily get financing for that property.
Categories
There are various categories of this loan. There is a low doc loan. As the name suggests, these loans require you to fulfill only a few pieces of documentation. Another one is the full doc loan category. In this category, you need to fulfill all pieces of documentation. The difference between the two of the Stated Income Commercial loans is that the low doc will make you eligible for a low amount. The full doc will make you eligible for bigger amounts.
You can choose to buy any one of them as per your needs. You don’t also need to worry about qualifying for the full doc loan.
