subject: Stated Income Loans Clifton New Jersey [print this page] Stated Income Loans Clifton New Jersey Stated Income Loans Clifton New Jersey
When taking out stated income loans, Clifton, New Jersey residents are offering little more than their word and a minimum of documentation to procure funding. Borrowers of stated income loans - Clifton, New Jersey being the area of lending - are taken at their word with the presentation of a statement. Stated income loans can be valuable for self-employed workers or those who have a hard time documenting their income. In some circles, stated income loans are referred to as "liar loans" due to the inherent fallibility in their design. Borrowers can sometimes state a number higher than what they actually take in as income, resulting in a loan that they will likely be unable to pay off when the time comes to settle.
For stated income loans, Clifton, New Jersey borrowers should adhere to the principles of responsible borrowing. Loans should never make up more than 45% of an individual's income. Stated income loans can fill gaps where a borrower has a great deal of debt that is rectified to the tune of profits but only periodically. Furthermore, situations where businesses and organizations need capital for investment purposes but are not presenting an acceptable debt to income ratio for a standard loan would be accepted for a stated income loan. Despite the situations where stated income loans make sense to the borrower and lender, it has been reported that up to 60% of all stated income loans are given to borrowers who have stated their income to be higher than what they actually recoup.
Borrowers and lenders must both use care when taking a stated income loan. Clifton, New Jersey institutions offering stated income loans may present the practice as appealing, but the pitfalls of handling it incorrectly can cause long-lasting financial hardship to the borrower. It is irresistible to some to borrow on more than they make, due to the lack of documentation they are being asked to present at the time of the loan. Many states are attempting to put into place different regulations to monitor stated income loans. Borrower's protection has become a key piece of legislation in many different regional governments and at the federal level.
In a situation where they need stated income loans, Clifton, New Jersey borrowers should borrow within what their means will be able to support. There has been movement among parties with inferior credit to use stated income loans for obtaining the money they need without repeated denials from non-stated income loans. Whereas an individual who makes less but has higher credit can get a traditional loan, those who make more money could be denied because of their credit history.
