No Doc Loan: No Income, No Employment, No Tax Returns
6 minute read
May 5, 2023


What if there were a mortgage program that didn’t care about your employment or income?

Rather, the loan would be based on your down payment or equity, credit score, and assets?

Now there is such a loan, called the No Doc Loan. It’s perfect for business owners, investors, and anyone with irregular or non-documentable income.

Apply for a No Doc Loan with our partner lender:

  • Bank Statement Loan
  • No-Doc programs
  • Purchase, Refi, 2nd Mortgage
  • 1+ yr self-employed and 1099 only
  • No tax returns; 10% down options
  • AL, AZ, CA, CO, FL, HI, ID, IA, KS, ME, MI, NH, ND, OR, TN, TX, UT, WA

What’s in this article?

How does a No Doc Loan work?
Who are No Doc Loans good for?
3 legs of No Doc Loan approval
Loan limits
No Doc Loan rates
Apply for a No Doc Loan

How does a No Doc Loan work?

This loan is best for high net worth individuals who can’t prove their income to qualify for a traditional mortgage.

This loan could also be called a “no income loan” because the lender literally doesn’t review income or employment, period.

Other loans, such as bank statement loans, still verify income, but via bank deposits instead of tax returns. No Doc Loans completely remove the income verification requirement.

Instead, the lender bases approval liquid assets, credit, and equity in the home.

Have plenty of assets, decent credit, and a healthy down payment or existing equity? You might be able to skip income verification altogether.

Who are No Doc Loans good for?

There are hundreds of borrower profiles No Doc Loans could help. Below are just a few types of individuals who could benefit.

  • Self-employed individuals
  • Small business owners
  • Real estate investors
  • Those with unpredictable but large incomes
  • Retired/FIRE’d
  • Seasonal & gig workers
  • Cash business owners
  • Self-employed less than 2 years
  • Experienced a recent health or family event
  • Refinancing homeowners
  • Recently immigrated individuals
  • Those who have been denied traditional financing

To sum up, anyone who can’t document steady income with tax returns  or regular bank statement deposits could be great candidates.

See if you qualify for a No Doc Loan.
  • Bank Statement Loan
  • No-Doc programs
  • Purchase, Refi, 2nd Mortgage
  • 1+ yr self-employed and 1099 only
  • No tax returns; 10% down options
  • AL, AZ, CA, CO, FL, HI, ID, IA, KS, ME, MI, NH, ND, OR, TN, TX, UT, WA

3 “Legs” of No Doc Loan approval: Down payment, months of reserves, and credit score

So how do you get one of these loans?

You could think of No Doc Loans as a 3-legged chair. The three legs are:

  • Credit score
  • Down payment or existing equity
  • Liquid reserves

The first two “legs” are self-explanatory, but what are “reserves”? These are the number of months of payments in reserve in liquid assets.

For example, your future home payment is $4,000 including principal, interest, taxes, insurance, and HOA dues. Twelve months of reserves would equal $48,000. You would need this amount left over after covering the down payment and closing costs.

Future payment: $4,00012 months15 months18 months
Down payment$100,000$100,000$100,000
Closing costs$10,000$10,000$10,000
Total assets required$158,000$170,000$182,000

Now that you understand reserves, below is an example of terms that a No Doc lender may offer for primary residences and vacation properties/2nd homes.

Home purchase or no-cash-out refinance, primary homes and 2nd/vacation homes

  • 740 credit and 20% down payment/equity: 12 months of reserves
  • 680 credit and 25% down payment/equity: 15 months of reserves
  • 660 credit and 30% down payment/equity: 18 months of reserves
  • 640 credit and 35% down payment/equity: 24 months of reserves

Cash-out refinance, primary homes and 2nd/vacation homes

  • 740 credit up to 70% loan-to-value: 12 months of reserves
  • 680 credit up to 70% loan-to-value: 15 months of reserves
  • 660 credit up to 70% loan-to-value: 18 months of reserves

You can see a pattern emerging: the lower the credit score, the higher the home equity and/or reserves required.

Assets will be verified with current bank statements. All funds must be “seasoned” 30 days, meaning once the funds are in your account for 30 days, they are considered yours and no sourcing needs to happen.

Maximum loan amounts

Because these loans are meant for high net worth individuals, loan amounts can be quite large. A common limit is $3 million or more.

Exceptions may be available if your assets and credit support a bigger loan.

No Doc Loan lenders

While No Doc lenders are harder to find than traditional ones, they do exist and lend in nearly every state in the U.S.

These lenders specialize in unique scenarios and can make their own approval decisions.

The funds come from private investors. Lenders are not beholden to government agencies to determine rules. Outside-the-box scenarios are gladly considered.

To save some time, you can get connected to a No Doc lender by submitting your scenario to our lender network.

No Doc Loan property types and occupancy

Because the lender has fewer elements on which to base the approval, the property likely has to be solid. The lender will order an appraisal to determine value and marketability.

As far as occupancy, many No Doc lenders will approve only lend on primary residences and vacation homes. There are a select few, though, that accept investment properties.

No Doc Loan rates

You can expect to pay higher rates for No Doc mortgages compared to conventional loans. This is because not proving the borrower’s income adds a layer of risk.

Still, these loans can be a great value, considering their leniency on traditional loan requirements. Speak to a lender to get your No Doc Loan quote.

No Doc alternatives

If your main goal is to avoid submitting tax returns, there are other loan types available.

DSCR loans: Investment property loans that base approval on the property’s cash flow. If  rental income is higher than the payment, it may be approved. The buyer does not need to provide personal income information.

Start your DSCR loan.

Bank statement loan: Rather than pay stubs or tax returns, the lender reviews regular deposits on bank statements to verify income.

  • Bank Statement and No-Doc programs
  • Purchase, Refi, 2nd Mortgage
  • 1+ yr self-employed and 1099 only
  • No tax returns; 10% down options
  • AL, AZ, CA, CO, FL, HI, ID, IA, KS, ME, MI, NH, ND, OR, TN, TX, UT, WA

Owner-occupied hard money loans: While hard money loans are traditionally meant for temporary investment property financing, some lenders allow you to use them to buy or refinance a personal home as well.

ITIN loan: Applicants with a source of income but no social security number or permanent residency status in the U.S.

FAQ on No Doc Loans

What is a No Doc loan?

There are many versions, but a popular type of No Doc Loan is one in which you qualify based on your credit score and amount of financial reserves. Those with good to excellent credit and high net worth may qualify without providing any income information at all.

Do I have to state my income for a No Doc Loan?

No. You do not state your income and no income is used on the application. This is also known as a no-ratio loan because no debt-to-income ratio is calculated.

Are No Doc Loans legal?

No Doc Loans are legal. The lender uses alternative methods to prove the borrower’s ability to repay. Instead of regular income, assets and credit score are the basis of repayment.

How do you qualify for a No Doc mortgage?

Typically, you need a credit score of 640 or higher, a large down payment of 20-35%, and 12 to 24 months worth of payments in reserve after paying for the down payment and closing costs.

Can I get a No Doc cash-out loan?

Yes, you can tap equity in the home as long as there is at least 30% equity left in the home after the new loan.

How to apply for a No Doc loan

To apply, find a No Doc lender that matches your scenario. Complete an application over the phone to see if you may be approved.

If you’re having trouble finding a lender, simply complete a short questionnaire to be matched to a partner lender.

Check your eligibility for a No Doc Loan.
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