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For most of us, buying a home is the largest expenditure that you will ever make. This will be your place of refuge against the elements. A place to raise your family. Where you will spend the majority of your free time.

A relatively important place that many dream of having, and you have worked hard to obtain. You want that process to be painless and enjoyable. Too many times, and for all the wrong reasons, it is not. We are here to make sure that a least a portion of that process is pleasant, and free of headaches.

Your first step will be to call our office. Our well trained staff will guide you through and assist you in the entire process from contract to closing. We can help. Call us, and UNLOCK YOUR POTENTIAL.

We outline herein, the various types of loans scenarios, and options available in New York for financing a home.

DOCUMENTATION TYPES:

FULL DOC: Literally, it means full documentation. See our Mortgage Process link that outlines all the various types of documents needed for this type of loan. When a lender looks at the underlying risks associated with any loan scenario, they are determining the level of risk associated with the loan. A full doc loan is the preferred type of loan from a lenders point of view.

• Pros: Preferred by the lender, allows all criteria to be reviewed, and reduces commitment time and pre-closing conditions.
• Cons: A lot of paperwork and copying is needed, and is initially time consuming.

LITE DOC: lite version of the full doc. Instead of 2 years tax returns, and pay stubs, 6-12 months of personal bank statements are acceptable.

• Pros: Great for self employed or those who benefit from alternative ways to show income.
• Cons: More paperwork, and usually only 75%to 90% of deposits can be used as income. May cost an additional rate increase of 1/4 to 1/2 point, pending the lender's guidelines.

Stated Programs: Another type of reduced documentation loan. Typically requires a high credit score. Most lenders will require a minimum FICO score of 680. Expect to have pay a little more for this reduced document program. Some lender will not charge an additional rate increase if your FICO score is greater than 730-750, pending guidelines. For those who do not want to disclose their incomes or that have multiple sources of incomes. Keep in mind, that what you state, will be verified. You will likely sign a document (IRS form 8821 and 4506) at closing allowing the bank to check the validity of your income figure. If you lie (commit fraud) about this on the application, the lender may CALL your loan, or can change the terms of your loan.

• SIVA: Stated Income, Verified Assets
• SISA: Stated Income, Stated Assets
• Pros: Less documentation, quicker to close these types of loans.
• Cons: Harder to get approvals, need excellent credit and more cash, with lower LTV limits.

No Income Programs (also known as No Ratio loans): Do not take this literally. You really DO need income, and usually lots of it. You just do not need to provide documentation on these types of loans. A high credit score is needed for these loans, and a higher interest is almost always charged as well. For the borrower who is self employed and has a harder time verifying actual income.

• NIVA: No Income, Verified Assets
• NINA: No Income, No Assets
• Pos: Quick loans for approval and quick to close if parameters are right.
• Cons: Higher costs in interest rates charged to the borrower, and more fees paid to the lender. Has the greatest risk to the lender, so usually a max LTV of 75% is allowed.

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