A lite income documentation loan is simalar to a fully documented loan.  However the income documentation usually doesn't include tax returns. 

As of September of 2008, the lending market is currently not offering the Lite Documentation loan option.  If lending markets loosen, the loan may return.  Below is how the Lite Documentation works.

6 months bank statements, or the most recent year W-2 or 1099 may qualify as lite documentation.  Evaluation bank statements may be done differently by each lender.  The lender may use average deposits, average ending balance, and abnormally large deposits may not be given credit.  In addition, to be conservative, only a percentage of the deposits may be used ie.... 75%.

Advantages: 

Slightly better rates and fees.  Sometimes the rate difference between a lite documentation loan, and a stated income loan may be .25%.  It does depend on your credit score as well as other factors, but it is still a worthy option to look into.

Disadvantages:

Higher interest rates.  More paperwork intensive type of loan to obtain.

Loans available:

The same as fully documented.

Scenario when used:

A borrower who experiences income fluctuations from year to year.  Submitting 2 years W-2's and tax returns, show different storys. Suppose you are self employed and this year shows a healthy profit, but the prior did not. Submitting 1 year of income documentation would be the way to go, and many lite documentation loans would except this.

Same thing with W-2 wage earners or commissioned people.  Some years are better than others.  Bank statements, or the most recent years W-2 may work.

Call me for details or click here to apply on-line today

Kevin Walton

Cell: 805-276-1942

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Best Capital Funding - 6930 Owensmouth Ave. #102 - Canoga Park, CA 91303
Office Phone: (818) 887-2779 Fax: 800-506-0632 Cell Phone: 805-276-1942

Best Capital Funding. 

 

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