What is a no doc fix and flip loan? This is a question that’s most commonly asked by people who are interested in entering the world of real estate investment. They want to buy a property, rehab it, and sell it for a profit. And, a no doc fix and flip loan certainly sounds like the perfect fit. But, while these types of loans are indeed available, they have some requirements, which include documentation. Read on to learn more about no doc fix and flip loans.
What is a no doc fix and flip loan? The term “no-doc” is short for “no documentation,” also sometimes referred to in the past as a “stated income” loan or mortgage. These were some of the biggest culprits which ultimately caused the Great Recession. Today, they are not nearly as widely available but do exist in different forms.
In order to obtain a mortgage for a residential or commercial property, you as the borrower need to supply certain documentation — like tax returns, along with other financial records. But, a no doc fix and flip loan can be acquired with bank statements and asset documentation. Generally, you’ll need the following to obtain a no doc fix and flip loan:
- Collateral. You’ll need to put up a collateral asset, determined by the amount and structure of the loan.
- Down payment. The borrower will be required to commit as much as 30 to 40 percent.
- Good credit. A credit score of at least 650 to 670 is often necessary.
Lastly, you’ll also need between two and three recent years of experience with buying, remodeling, and selling investment properties.