The main benefit of stated income non-QM loans is the ability for borrowers to qualify for a loan without having to provide detailed income information. This can be especially helpful for self-employed borrowers who may not have the same income stability as those with a regular salary or wages. It can also be helpful for those who have recently changed jobs or experienced an income interruption or decrease.
The downside to these loans is that they can be more expensive than traditional mortgages. Since lenders are taking on more risk by not verifying income, they must charge higher interest rates to make up for that. This can mean a higher monthly payment for the borrower and a longer loan term.
For borrowers who are considering a stated income non-QM loan, it’s important to understand the risks and benefits
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