Stated Income Loans Are Helping Self-Employed Borrowers

New Jersey homeowners are fortunate that stated income loans are still available in New Jersey...

One of the most significant knee jerk reactions to the recent mortgage crisis was the virtual elimination of stated income loans. They are very important to self-employed borrowers who show a low net income on their tax returns because they are taking advantage of the allowable deductions. So, when the lenders tightened their guidelines, most of them eliminated stated income loans. How does did this impact self employed borrowers in NJ? Simple...they can not qualify. As a result, they are stuck in their situation. Either unable to buy a new home or unable to refinance.

The good news is there are a couple of lenders who will still originate stated income loans. Right now, New Jersey, New York, Connecticut and Pennsylvania (NJ, NY, CT, PA) are states where not only are they available, but the stated income rates are extremely low. There are lenders who can help with your stated income needs in those states. Meanwhile, the best rates for those loans can be found in New Jersey. The fact that New Jersey homeowners can find stated income loans means the values will hold steady and turn around faster than most other states. Since the rates are lower, those same borrowers can also help their monthly cash flow situation and potentially save money for other investments.

In New Jersey NJ, you can find a stated income loan with as little as 30% down and yes the rates are only slightly higher than a full documentation loan. Borrowers would need to be self employed and the home must be a primary residence. As an added benefit, the rates are also lower in New Jersey. Guideline changes are needed if more self employed borrowers are to receive help with lower down payments. It does not make sense to have self employed borrowers use net income on the tax returns to qualification purposes when they are deducting some of the same expenses that salaried borrowers are on their returns. Hopefully at some point in the future we can use a number that is closer to the gross income on those self employed tax returns as opposed to simply using net income. That way, many more self employed homeowners can qualify to purchase a new home or simply refinance their current loan to a lower rate....and with a smaller down payment.

If you would like more information on these loans, looking for a rate quote or need more questions answered, then contact a qualified mortgage company using the link below. You should also educate yourself about loan options, FAQ, loan shopping guide, closing costs, mortgage trends and much more.