Being your own boss definitely has its perks—flexible schedule, unlimited income potential, and control over your destiny. But when it comes to securing traditional real estate loans? That’s when things can get… complicated.
If you’re self-employed, you already know that conventional loans tend to ask for a mountain of paperwork—tax returns, pay stubs, W-2s, profit-and-loss statements… and the list goes on. That’s where stated income loans for real estate come in to save the day.
Let’s dive into why these flexible loans are becoming the go-to solution for independent investors and entrepreneurs.
What Are Stated Income Loans?
Unlike conventional loans, where approval heavily depends on documented income like tax returns, stated income loans allow borrowers to “state” their income on the application without having to verify it with traditional documentation. The lender focuses more on the property’s value and your creditworthiness than your tax history.
So, if your tax returns don’t reflect your actual earning potential—thanks to deductions or reinvestments—you’re not automatically disqualified.
Why Self-Employed Borrowers Love Stated Income Loans
For self-employed real estate investors, stated income loans for real estate offer a faster, simpler way to secure financing. Here’s why they’re gaining popularity:
- Fewer Documentation Requirements: Say goodbye to endless paperwork. You won’t need to submit years of tax returns or dig up your latest P&L sheet.
- Faster Closings: With less to verify, these loans can close much more quickly. That’s a game-changer in competitive real estate markets.
- Perfect for Investors: Many lenders offering stated income loans for real estateare more focused on the property’s potential income than your fluctuating self-employment records.
- Greater Privacy: Not everyone wants to hand over every last financial detail. With these loans, you don’t have to.
Pair It With a Smart Refinance Strategy
Already own property? You can take your investments even further with a cash out refinance home loan. That means refinancing your existing mortgage and taking out equity in cash—which you can use for renovations, new purchases, or other investments.
Look into cash out refinance loans to supercharge your portfolio. Comparing cash out refinance loan rates is key. Don’t forget to factor in refinance requirements and your overall cash out refinance eligibility before jumping in.
How Stated Income Loans Compare to Traditional Loans
- Documentation:
Stated income loans require minimal paperwork. You don’t have to submit piles of tax returns or bank statements. In contrast, traditional loans demand extensive documentation to verify income and financial stability. - Speed:
Stated income loans close much faster because there’s less to review. Traditional loans can take weeks (sometimes months) due to longer approval and underwriting processes. - Ideal Borrowers:
Stated income loans are perfect for self-employed individuals or investors who may not show steady income on paper. Traditional loans are generally better suited for W-2 employees with consistent income. - Flexibility:
Stated income loans offer more flexibility in terms of income reporting and loan structure. Traditional loans are stricter and follow more rigid guidelines.
What to Keep in Mind Before Applying
Even though stated income loans are easier to qualify for, they do come with responsibilities:
- Expect slightly higher interest rates due to reduced verification.
- Be honest about your income—lenders still evaluate your credit and the property.
- Prepare for a down payment. Most stated income loans for real estaterequire around 20-30%.
And if you’re planning a cash out refinance application, understand the process, including key steps like appraisals, disclosures, and closing timelines. Use tools like cash out refinance online calculators to estimate your savings and compare cash out refinance mortgage lenders.
Flexible Funding Starts Here
If you’re self-employed and tired of hitting walls with traditional lenders, stated income loans for real estate may be the freedom pass you’ve been waiting for. When paired with smart use of equity through cash out refinance options, your path to real estate success gets even smoother.
These loans let you move quickly, borrow flexibly, and scale your investment strategy without being buried in paperwork. And with real estate markets offering more opportunities than ever, the timing couldn’t be better.
Let’s Make It Happen
At Insula Capital Group, we get self-employed investors because we work with them every day. Our team specializes in stated income loans for real estate, helping you close fast and invest smarter. Want to explore cash out refinance for single family home options? Curious about cash out refinance eligibility requirements? We’ve got you covered.
Reach out today and let’s build something big—together.
