Generally, lenders review the credit history for the past 12- 24 months. Income Ratios Besides credit considerations, non-traditional lenders review the capacity of the borrowers to repay the mortgage obligation. If a borrower has a low debt ratio, the grade will be higher. Conversely, if a borrower has a high debt ratio, the grade will be lower. Generally lenders require a two-year history to substantiate the borrower's income.
Borrowers provide bank statements to substantiate monthly income.
Lenders use the stated income from the loan application and the borrowers do not have to provide any documentation to substantiate the income. Lenders will assess a lower grade on loans when little or no documentation is provided to substantiate the borrower's income. There is little difference in the loan programs provided by traditional and non-traditional lenders. The real question is whether it is better to put money into a home or elsewhere. Those with property who are moving to a new home often have a different situation because they have equity built up over many years.