Who should consider a No Ratio mortgage loan?
Answer:A No Ratio mortgage loan is for people who don't want to disclose their income for a good reason. Either they can't document it, or their Debt to Income ratio doesn't qualify them for the right loan amount. However, if they have good credit and have some assets, they could be successful with a No Ratio loan.
Usually, Low and No Doc mortgage loans have been long used by borrowers to exaggerate their income and as a result experience foreclosure. If you are going No Ratio, better have another reason to do that.
For example, a couple with one of the partners having bad credit and high income, and the other - good credit and low income could be successful with a No Ratio mortgage loan, especially if they can't document part of their income or have a high DTI. The loan officer is worth talking to before you decide to go No Ratio or NINA. Also, in many cases loan officers find a way to make the loan better documentable than the borrowers initially thought. However, it is always better to go as close to full doc as possible, if you don't care about privacy and you are eligible.
Our advice: Be sure to ask your lender about FHA loans. FHA loans have very competitive interest rates because the loans are insured by the US Federal Government. Even if you have had serious credit problems, such as bankruptcy, it is easier to qualify for an FHA loan than a conventional loan. Also, taking an FIXED rate loan while the interest rates are still low is a smart idea. Check your eligibility here:
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