You may not be
eligible for property mortgages but you can always apply for lo doc loans.
How do you go
about this procedure?
Low document
loans are meant for individuals who look forward to purchase real estate but
are not eligible for regular property mortgage. The basic difference is that
you will not be obliged to submit documents such as proof of income as well as
assets and liabilities. It makes use of the process of self-verification. You
just need to declare your income without the certified documentation.
Higher
Repayment Rates
These low
document loans are intended for those who possess equity or savings deposits
and are not capable of presenting proof of regular earnings. These are casual
employees, self-employed entrepreneurs of consumers with negative credit
ratings.
If your only
option is the Lo Doc loans, it is important to
determine if you can afford repayment rates. Remember that lenders usually
charge very high interest rates in the absence of the normal requirements for
regular loans. Another condition for low doc loans is mortgage insurance which
bloats the costs further. The rule is that this type of mortgage covers until
80% of the property value.
The three major
categories of low document loans are the following:
Self-declared
Income – The lender agrees to give 80% of the property value based solely on
the signed statement of income without any verification of income but a higher
interest charge.
Account
Statement – This requires confirmation such as a certification from your
accountant. However, the interest is similar to regular housing loans.
Asset Lend –
This loan depends on the value of your home with lower property value and
higher interest rates.
As mentioned
previously, the Lo Doc loans have high
interest rates. Yet, if you are able to submit more financial confirmation, the
interest goes lower. You cannot bypass the mortgage insurance and higher
deposit is demanded. Almost 20% of the property value should be given by the
buyer. In fact, you may even be asked for additional security such as your
automobile or some other investments. The loan period is short, which is
usually one year, forcing the debtor to opt for refinancing.
Think hard
before applying for this loan!
Call us at 0435853375 since we can help you with
this concern.
