| A
mortgage Tony Soprano would love: The no-doc | | |
| McLaughlin says this type of loan
also can be for someone going through a big change, such as a divorce, death of
a spouse, a career switch or retirement.
"There are those who basically retire, say,
'I cashed out of my business and got $3 million and I invested it and I'm going
to make 10 percent.' That can't be documented," McLaughlin says. "That's
a person who might get a no-doc loan until they get a track record of making money." He
says these also are for people "who say, 'I don't want to tell my whole life
story to someone, so I want to pay a premium rate not to do that.'" The
rate for a no-ratio mortgage would start out at about a half-point above the rate
for a conventional mortgage and might be up to 3 points higher, depending mostly
on credit score, size of down payment and the property appraisal. This
type of mortgage might be just right for the Fisher brothers in "Six Feet
Under," who own a business and are going through lots of changes: the death
of their father, a career change and coming out of the closet. No-income/no-asset
verification mortgages
These loans, sometimes known as NINAs, need
the least documentation. In some cases the borrower provides his or her name,
Social Security number, the amount of the down payment and the address of the
property being bought. That's it. The lender gets a credit report and a property
appraisal. The line gets fuzzy between no-ratio and NINA mortgages,
McLaughlin says. A lot depends upon the borrower's credit score. The better the
score, the less documentation the lender will demand. In many cases, the lender
will want to know what the buyer does for a living and for how long. Lenders feel
more comfortable with a borrower who has been doing the same job for at least
two years. In any case, an excellent credit score is required.
These mortgages are for people who never, ever fail to pay bills on time. Actually,
they're for people who employ assistants to pay the bills on time. They're meant for people who zealously guard their
privacy -- the movie star who doesn't want someone in the loan office selling
copies of her tax return to The National Enquirer, the mobster who doesn't want
to leave a paper trail. The less documentation, the higher
the rate. Someone getting a no-documentation mortgage might pay up to 3 percentage
points higher than the going rate for fully documented conventional mortgages.
"It's always a layered risk situation," McLaughlin
says. The size of the down payment is one layer -- the bigger the down payment,
the lower the risk and the lower the rate. The same goes for credit score, willingness
to show ownership of assets, and the degree of openness about what the borrower
does for a living. A NINA mortgage might be right for the covert
CIA agents in "The Agency" and mobster Tony Soprano from "The Sopranos." No
one in his right mind would ask Tony Soprano too many questions, except his psychiatrist. | 
