No Ratio Loans are available for who wish to qualify for a mortgage without any true income requirements. On the application you would not state your income at all, but may be required to verify your assets.

With a stated income loan you are required to list the amount of income that you truly make on your loan application. The advantage of a stated income loan is reduced income documentation is required for these types of loans. The reduction of income documentation will usually result in a slight rate bump. Now if you are a teacher at a public school and try stating that you make $300,000/year on a stated income loan, that is not reasonable for your line of work and an underwriter would question this. Now on a no ratio loan, you simply do not list an income amount at all on your loan application and no debt to income ratio is ever calculated. Obviously this is a bit of a higher risk loan and there is usually a bigger rate bump than on stated income loans due to the higher risk. Therefore, before you state an inflated income on a mortgage loan application and lie on your loan application ask if you might qualify for a no ratio income loan instead. Your job and job history will still be verified with a no ratio loan, however your income will not be requested nor verified.

Stated Income documentation programs are available to borrowers who have trouble documenting their adjusted gross income, but unlike No Ratio programs, the stated income still must be used to "qualify" for the loan.

Sometime problems arise when the stated income may not make sense for the person particular field of employment. By using a No Ratio Loan that problem can be solved.