Avoid Legal Trouble with Non-Income Verification Loans on Mortgages

If you've decided that you'd like to pursue a non-income verification loan for your mortgage, you should know that legal trouble might not be far away. There have been several instances over the last few years in which borrowers of non-income verification loans have been indicted on charges of fraud, which can certainly ruin your financial future (as well as your freedom).

A non-income verification loan is a mortgage loan that doesn't require any proof of income or employment. These are often called "no-documentation" loans because they don't require nearly as much paperwork, and the approval process is generally much faster. This might sound like a great way to obtain a mortgage fast, but beware the legal implications.

When you apply for a non-income verification loan, you will have to fill out an application and submit to a credit check by the lender. Most approvals are based solely on the information provided on the application and the information in the borrower's credit file, which makes it a high-risk endeavor for the lender. This is compounded by the fact that many individuals---either through negligence or deceit---lie on their loan applications.

If you're going to apply for a non-income verification loan for your mortgage, you need to collect all information about your income and assets for yourself. You won't need to verify this information with the lender, but it will help ensure that you are truthful on the application. Even submitting information that is a few numbers off can result in legal trouble with the lender and with the courts, so this step is crucial.

Once you've gathered the appropriate information, fill out the application slowly and carefully. Ask the non-income verification loan lender what information they will need to process the mortgage application, and if any extra documentation will be required. If your credit score isn't quite high enough or if you don't have sufficient assets, you might be asked to provide tax returns for the last two or three years.