Colorado No Ratio Loan
No Doc Mortgage loans
No Ratio Loan Programs
Learn more about the no debt ratio mortgage to buy or refinance your home
What is a No Ratio Mortgage Loan?
A no ratio loan is a unique non-QM mortgage that provides a solution for underserved persons with substantial savings along with undocumentable income, low income, unemployed, or retired. Your funds to close, mortgage payment reserves, and credit history are the primary factors that determine if you will be approved or denied financing.
How Does a No Ratio Loan Work?
The loan is pretty simple once you know the details. Here's a couple of examples below.
- Example If Buying
- Home's Purchase Price: $1,000,000
- Down payment: $250,000
- New mortgage balance: $750,000
- Reserves: $55,000 (9 months of P.I.T.I)
- Documentation: credit report & "seasoned" funds to close
- Example If Refinancing
- Existing home's value: $1,200,000
- Current mortgage balance: $800,000
- Loan to Value: 66 ($800K÷$1,200,000 = 66)
- Documentation: credit report & "seasoned" funds to close
- Reserves: $55,000 (9 months of P.I.T.I)
In either transaction, no personal income or employment is disclosed on the application.
Who can benefit from a No Ratio loan?
This no doc mortgages benefits those who have a sizeable down payment and significant savings or investments in a money market, IRA, 401(k), brokerage account and so on. In theory, you could be in between jobs or retired and receive a large lump sum of money from an inheritance, gambling, or litigation and use a portion of that to get a mortgage to buy a home.
This loan helps people who are traditionally locked out of financial systems and are generally considered low-income among other aspects.
Typical Borrower Types
- Online or Cash Business Owners
- Homeowners with Equity
- Retirees
- Seasonal & Gig Worker
- Change of Industry or Employment Type
- Real Estate Investors
- Self-Employed
- Recent Immigrants
- Dispensary Owners/Employees
- Loss of Job or Low Income
Here's what you need to qualify
Debt ratios: None calculated.
Loan-to-value: maximum is 80 LTV to $1.5M for a home. 75 LTV for condos.
Refinance limit is 70-75 LTV
Occupancy: primary residence or second home only.
As of Oct. 1, 2024 in order to qualify you will need to satisfy the above:
Advantages
1.) no personal income or employment is disclosed or verified
2.) no debt ratio (DTI) calculation
3.) interest only monthly payment option
4.) great loan to use to get the property and in 1-2 years refinance
Disadvantages
1.) interest rates are higher due to no income & no job verification (starting in the 8's)
2.) liquid reserves needed for P.I.T.I is more than traditional loans
Product Details
Wherever your credit scores are in the chart below will display the required down payment to buy or the equity required to refinance along with the amount of cash reserves you'll need. For refinance cash out, you need to have four months prior to applying.
| Transaction Type | Credit Scores | Down Payment or Equity Req'd | PITI Liquid Reserves |
|---|---|---|---|
| Purchase or Refinance |
720 and up
680-739
660-679
|
20%
25%
35%
|
12 months
9 months
9 months
|
| Refinance with Cash Out |
740 and up
700-739
680-699
|
20%
25%
35%
|
9 months
9 months
9 months
|
| Maximum Loan Amounts | |
|---|---|
| Purchase & Refinances | |
| LTV over 75 | $1,500,000 ($1.875M home purchase) |
| LTV up to 75 | $2,000,000 ($2.6M home purchase) |
| Cash Out Refinances | |
| LTV up to 70 | $1,500,000 ($2.14M home value) |
Credit Scores: FICO credit scores from the 3 major credit bureaus.
P.I.T.I.: Principal, Interest, Property Taxes, Insurance (and HOA dues if applicable) is the full monthly mortgage payment.
LTV: Loan-to-value.
This Non-QM loan program is designed to fill in the gap by other lenders. The amortization periods offered are 30-year terms on either a 5/6 (5-year Fixed ARM), 7/6 (7-year Fixed ARM), 10/6 ARM or 30-year fixed.
Areas Served
We serve borrowers across the state of Colorado which includes the following cities and adjacent area:
- Aurora
- Denver
- Centennial
- Fort Collins
- Boulder
- Parker
- Loveland
- Englewood
- Longmont
- Colorado Springs
- Lakewood
- Broomfield
Disclosure: Minimum loan amount is $200,000 for residential. Loan programs are subject to change per lender at any time until the loan is approved and the rate is locked. Borrowers must be approved by underwriting. Not all applicants will qualify.