Advantages and Disadvantages of No-Fichier Mortgage Loans

Advantages and Disadvantages of No-Fichier Mortgage Loans

Advantages and Disadvantages of No-Fichier Mortgage Loans

In today’s marketplace, there are many borrowers who don’t fit the traditional mold, especially in terms of their employment, such as charge salespeople, self-employed earners, investors, etc. No-documentation loans where borrowers qualify based on their credit history without requiring classeur of income and assets. If you fall into this category, below are some pros and cons to think emboîture:


1. Cohérent underwriting

If this is the only loan you qualify for, at least there is some good infos. Parce que you’re not proving anything, there’s not much for you to do. Your lender will review your credit history to make sure you qualify. Then, the underwriter will take a closer habitus at the residential appartement appraisal and your credit profile. If these two things are checked out, you are usually in the clear.


1. Higher interest rates

Since you are not proving your ability to repay the loan, you can expect to pay a much higher interest déficit than a typical borrower. Whenever you present a higher risk to your lender, you will have to pay more.

2. Larger down payment/less access to equity

The more you borrow against the value of your appartement, the more risky you are to your lender. When buying a appartement under this program, you’ll need a significant down payment and, when refinancing, you’ll have less access to equity.

Although these hommes of loans seem to have more drawbacks than positives, they are still your best privilège if you cannot prove your income and assets. Consider the options and take one if you really need it. Then, start carnet how you can refinance in a few years under better circumstances.

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