Mortgage Documentation

[fla-tan]

There has been more than one person requesting that there be a post that shows different documentation levels for mortgages. Even though I received the first request probably 2 years ago or more, I am just now getting around to creating and posting it. I hope that this helps to answer a lot of questions.

 

 

The range of documentation types runs the gamut from full documentation to no documentation. Below is listed a brief explanation of each type.

 

1) Full Doc (umentation): This is the most common type of mortgage

documentation. With a full doc mortgage you will normally be expected to

provide complete proof and documentation of all income sources and asset

sources. You can usually be expected to provide at a minimum; your last 2

paystubs, your last 2 years W-2 forms, your last 2-3 months bank statements

for each bank account that you have (full statements and not just the first

page), your most recent 6 months 401K and/or IRA statements. With many sub

prime lenders, you can substitute your last 12-24 months bank statements in

lieu of both pay stubs and W-2s.

 

2) Limited Doc: A limited (lite) doc mortgage generally will use as little as 6

months bank statements to prove income. Otherwise it is like a full doc

mortgage.

 

3) Stated Income/Verified Asset (SIVA): With a stated income/verified asset

mortgage you simply state what your income is, though it has to be

reasonable to the type of work. Like the full doc mortgage you will need to

verify your assets with documentation.

 

4) Stated Income/Stated Asset (SISA): With a stated income/stated asset

mortgage, you state both your income and what assets you have. These are

not verified.

 

5) No Ratio: This mortgage type has no income associated with it. While

employment information is required, the income amount is neither shown nor

disclosed. The only information that is verified with the employer is that

the borrower is employed there and for how long. Assets will normally be

verified with this mortgage type.

 

6) No Income No Asset (NINA): With this mortgage type, neither income nor

assets are shown. As with a no ratio mortgage, employment is verified.

 

7) No Documentation: A no doc mortgage is just that, there is no documentation

required to be approved. This mortgage will be strictly based on the

borrower’s credit score and depth of his/her credit history.

 

 

This is simply a brief synopsis of mortgage documentation types. Virtually all mortgages will be one of these types. Lenders may call them by different names, but they will be one of these types anyway.

 

 

fla-tan

[800score]

Great post! The only thing missing are the [ ] marks around the descriptions and the footnote depicting paraphrasing of Liverichly!!!

 

800s

[rookie457]

Very good info. Can you rate the different doc levels?

 

Best 1-10 Not best

 

Full Doc = X

[fla-tan]

Great post!  The only thing missing are the [  ] marks around the descriptions and the footnote depicting paraphrasing of Liverichly!!! 

 

800s

<{POST_SNAPBACK}>

 

800

 

I didn't paraphrase Shane. These are pretty generic descriptions as I am sure you know.

 

 

fla-tan

[fla-tan]

Very good info. Can you rate the different doc levels?

 

Best 1-10 Not best

 

Full Doc = X

<{POST_SNAPBACK}>

 

rookie

 

The easiest way to put it is: The more information that the lender has in order to make a decision, the lower the rate will be when everything else is equal. In other words, the full doc mortgage will have the lowest rate and the no doc mortgage will have the highest rate.

 

 

fla-tan

[SevenDoubleOh]

One more thing about Reduced Doc loans...

 

Stated income as well as NoRatio loans often require the verification of your income source in some form. For example, self employed borrowers may need a CPA letter to verify they have been in business for 2 years. W2'd employees job's may also need to be verified for the past two years, though the amount is not. The guidelines vary among lenders though.

 

Also, some lenders definitions of these doc types vary. To many, a NINA and a NoDoc are one in the same. Such is the case with Wells Fargo.

 

I hope my first post was informative. I registered to get post BK7 credit help, but, since I am a mortgage lender rep, I figured I can lend a hand in the mortgage forum when the need arises.

Edited December 13, 2005 by SevenDoubleOh