This is a good option for a person who is self-employed under all the possible variations. It goes to show that everyone has a right to enjoy credit, without having the backup of a steady job. Well, some home-based businesses are steadier than certain companies with a big façade, at that...

No Documentation Loans

That is what they are called, since there is no documentation on assets, job or income to be sent in. Since the borrower is self-employed, the lender must have some security and will require a property as collateral, so the only data to be verified are the title deed of the property and the credit report. Credit reports with negative entries will change the interest rate, as long as it is not downright bad credit.

The Differences

As usual, the different condition calls for a variation in the interest rates and the down payment. Rates are (again) slightly higher, reaching maybe 1.5% higher than the regular rates, but the down payment can be as low as 5%, relying on the presentation of the property as security.

The Similarities

The type of mortgage is as usual, adjustable or fixed rate and they are available in terms of between 15 and 30 years, just like documented loans. However, there are shorter term loans for those who can afford it.

Now, Real Life

There certainly are loans of this type, in fact they are advertised everywhere, although much more difficult to find than one could imagine. The bank or lending company from around the corner may not accept self-employed borrowers, but if you carry out a careful search, you will find enough to choose from.

Much Has Been Said

Many self-employed borrowers have lied to their lenders so as to get a greater loan or mortgage, but in the end it has invariably hurt them and not the lenders, in the cases in which a default has given way to a foreclosure.

A Growing Market

This is a well-known fact, but since nowadays being self-employed is getting to be more and more satisfactory and prosperous, there are many more people who want to tap into this way of life. We must say that there is a great positive factor, which is the incentive workers have, in order to make their home-business really work well, since all the benefit will be theirs and not their employers'.

Whether home-based business, Internet-assisted or Internet-based business, stay-at-home Moms making good business producing baby-food or whichever variety of self-employed work it happens to be, people are beginning to see the real benefit of kissing their employers good-bye. It is a re-edition of Renaissance times, when so many artisans, craftsmen and specialized workers flourished, leaving the farms in which they were employed.

The Times They Are A Changin'

Taking this into consideration, lenders want to keep up with changes in employment trends and have tailored loans for this growing market. Self-employed loans carry a great benefit for both parties. Workers can still get their homes under fairly normal conditions without having to depend on their salary slip and lenders are developing their ingenuity on a daily basis, working out new ways of satisfying an ever-changing market.