Home Buying in Olney>Question Details

Sok, Other/Just Looking in Philadelphia, PA

Are there still such a thing as 20% down no doc loans?

Asked by Sok, Philadelphia, PA Thu Aug 19, 2010

I'm looking to purchase a home (foreclosure or not) but I want to do a no document loan. I heard from a friend about the 20% no doc fee which I just saved up enough for.

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Sok,

I actually just had a buyer use one of these types of loans on one of my listings a few months back. I was very skeptical when the offer came in , but after checking numerous sources everything turned out great. My understanding is that there are only 2 inverstors in all of PA that will back this type of loan. However it is nowhere near 20% anymore. She had to put down 40% of the purchase price to get this type of loan and the rates are not even close to the current FHA and Conventional Loan rates. When we did this a few months ago the rates on standard loan products were around 5 and her rate was 7.5%. So I would venture to guess the rate on a product like this would be around 7% currently.

Good Luck,


Andrew Himes, CRS, e-PRO, ABR
Prudential Fox & Roach Realtors
Web Reference: http://www.AndrewHimes.com
1 vote Thank Flag Link Fri Aug 20, 2010
No Doc loans should have NEVER happened in the first place. If you can't prove where you get your money, then you have no privilege to get a loan. Save up and pay for the home outright.
3 votes Thank Flag Link Fri Aug 20, 2010
hmmm.my credit score is 772, i am self employed but still pay taxes quarterly. last year I claimed money each quarter, the year before i only had one quarter to claim because i was pregnant and took time off.So I easily can pay a mortgage, but i dont have two years of icome to prove my real income, considering the time off being pregnant. Situations like mine is one example of why I believe they should do non doc loans, but that is just my opinion :)
Flag Wed Feb 24, 2016
Terrence, real estate agents should stay out of financing just like mortgage advisors should stay out of negotiations of homes. I agree with Charlie below, your statement is ignorant and makes a complete blanket judgment. I agree with you Terrance that

No doc loans should not have happened for anyone looking to abuse the system, however, they are a needed product. For example, a borrower who has recently gotten work after being laid off will have a break in their employment history. This could stop them from being approved for a mortgage. But if this person has money, good credit and is willing to accept a higher rate and put more money down, a no doc loan could get






et around the employment gap issue. Or, they could have income from outside the United States which is not recognized by underwriters. So again, they have the money and can even prove it with documentation, but it is unacceptable from an underwriters perspective. Again, is it fair to be biased towards this person?
Flag Sat Jul 13, 2013
You're making an arrogant blanket judgment. I have excellent credit, NO debt, a paid for house whose value I plan to put towards my next house and money in the bank. Why should I have to take most of my money out of the bank to pay cash when I can put 75% down so the bank has no risk if I default on a 25% loan. With rates so low, I should be able to get a loan with 75% down payment. Why should I not be approved when someone WITH debt and little or no money in the bank can qualify for a loan with minimum down, just because they have a job they could LOSE TOMORROW!!! I am virtually no risk while many who can show income to qualify and are putting maybe only 20% down and solely dependent on their job continuing are a risk. The problem is No Doc loans were previously made frivolously and now it's the other extreme. You write as if everyone could simply "save up and pay for the home outright!!" You'd sell a lot more if the financing rules were relaxed to a reasonable level.
Flag Thu Mar 7, 2013
There are many good answers here for you. Bottom line is that if a Buyer has exceptional credit, verifiable employment and assets, then there are some lenders, mostly private, who will fund these types of deals.

Again with good credit and verifiable assets there are many ways that lenders can still be creative enough to fund purchases without full docs. You may wish to reach out to Ed Dubinsky at United Capital Lenders at 215-808-5353. He may be able to provide you with some creative financing options.

If you would like some assistance in finding a home and negotiating a good deal, please feel free to call me.
Good luck with everything. Looking forward to hearing good news from you soon.

All the best,
Larry Lichtman
REALTOR, Property Manager
Your Real Estate Resource For Life
Direct CELL (267) 254-7994
LarrySellsRealEstate@gmail.com
1 vote Thank Flag Link Fri Aug 20, 2010
I believe they have gone the way of the dinosaur. Were originally meant for buyers who were self employed.
The program was totally abused and large loans were given to buyers who were credit qualified but were not income qualified. No doc loan abuse is responsible for some of the forclosures we are now and have been seeing.
1 vote Thank Flag Link Fri Aug 20, 2010
I have seen some lenders doing these type of loans however, the interest rate is higher and they want more than 20% down.

You should try a FHA or Conv loan. If you have a job, proof of income and a decent credit score then you will have no problem getting a full doc loan.

Good Luck
0 votes Thank Flag Link Fri Sep 28, 2012
Interesting...my gut says no but if anyone says otherwise I am curious to hear.
0 votes Thank Flag Link Fri Sep 28, 2012
You know, there was really no need to write such a nasty letter to me. I tell people the way it is. There are a lot of real estate agents out there who tell you what you want to hear or just "soften" the blow by bending the truth.

The fact of the matter remains that getting a no doc loan these days are virtually impossible to find. If you find one, great. You said, "Then you should scrutinize the #$^* lenders and realtors like you who help idiots who can't pay for their mortgage to get homes." But how can a lender know that you can afford your home if you don't want to show where your money comes from?

I will also state that I have never worked with anyone who could not show their income nor will I ever do so. o just grow up and either accept the truth or continue looking for a lender who will give you money on your word.
0 votes Thank Flag Link Sat Aug 21, 2010
Are you asking about "liar" loans? Thats what the government calls them! There are a few lenders that are getting back into these types of products for the self employed people people who have a hard time verifying income and whose credit is very strong and assets more than sufficient and verifiable. These types of loans always existed until during the "boom" and then they were abused to put people in houses that they could not afford and most lenders did away totally with all the different types oft them.

So to answer your question, these loans do exist but if your credit is not great (720+) and assets(verifiable cash in a bank account, cds,stocks,bonds, etc) not verifable than you will get turned down.
0 votes Thank Flag Link Fri Aug 20, 2010
Sok,

I would direct you to my blog from April 18, 2010- “SIVA, SISA, NINA..... Which type of loan did you get?”

Then I would ask why would you want to do it?

Linda
Web Reference: http://www.lindacefalu.com
0 votes Thank Flag Link Fri Aug 20, 2010
Hi, Sok.

All of the answers below are correct. In general, No Doc loans do not exist anymore. But there are some lenders out there who offer programs that do not scrutinize over income requirements if the rest of your profile looks good (credit, employment, assets, etc.) and you put enough down (usually over 20%).

If you need a good lender who can review your profile and present you with options, please let me know and I will help.

Thanks,
Tim

Timothy M. Garrity | Brown McKinney Real Estate, Co.
Real Estate Professional & Consultant
http://www.phillyurbanliving.com

tgarrity@brownmckinney.com Email | http://www.brownmckinney.com/tim Website
215-825-2250 x 1007 Office | 267-879-2716 Mobile | 267-519-5490 Fax
0 votes Thank Flag Link Fri Aug 20, 2010
I can get them done still but now I think it's 30% down and you need great credit

let me know

Jason Lepore
Remax
selling in nj and pa
215-688-1446
Web Reference: http://Www.leporeteam.com
0 votes Thank Flag Link Fri Aug 20, 2010
Hi Sok,

Most of those programs are gone. Many have blamed those types of programs for the trouble the housing market is in. They can be a good thing if used properly but I don't think we will see them anytime soon.

Good Luck!
0 votes Thank Flag Link Fri Aug 20, 2010
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