How Stated Income Loans Work in Property Investment

David Cohn
Oct 9, 2020
Stated Income Loans

Not all borrowers will be qualified for traditional commercial loans from banks. But not all hope is lost.

This doesn’t mean that they cannot get the financing they need at all.

If you find yourself being turned down by traditional lenders, you can consider stated income commercial loans that don't require you to declare your income.

What is Stated Income Loan?

A stated income loan was designed to simplify the application process for buyers with incomes that are difficult to document.

Self-employed individuals and those whose incomes are dependent mostly on tips are examples of buyers in this situation.

It is a loan that is under the Alt-A category of products. Sometimes, it is called liar loans or NINA (no income-no asset) loans.

But is this type of loan ideal for your next property investment?

It may be tempting to apply immediately as some lenders are promoting stated income commercial real estate loans as appealing alternatives to conventional mortgages.

You can certainly take advantage of them—but only if you know what you’re doing.

It’s important to make sure if this type of loan is suitable for your property investment project.

Understanding your needs

Before proceeding to get a stated income commercial loan, you need to identify what kind of real estate investor, you are:

  • Flippers – These are property investors who purchase property to modify it before putting it back into the market within a short time. They have to deal with high capital gains taxes, but the money they can earn in a few months is usually worth the effort. However, in some cases, properties may end up being listed much longer than they expect, so until the property is sold, their profits are eaten up by maintenance, utilities, and other costs.
  • Landlords – These investors may buy multiple units and offer a monthly rate to rent them out. Having no vacancy is the ideal scenario for a steady stated income. If a sector or an area has more inventory, property owners might have difficulty getting their asking price. Sometimes, renters may negotiate the monthly payment down. The landlords would have to sacrifice their potential income to advertise their rental units at competitive rates to attract potential occupants as soon as possible.
  • Vacation homeowners – This is a growing sector of property investors. People who own vacation properties have duties that are similar to landlords. The only difference is that they may offer different rates for monthly, weekly, and overnight occupancy. Their units are usually furnished, which means more maintenance costs. When renting out commercial units and apartments, you have concern yourself with wiping surfaces, making repairs, and shampooing carpets when tenants evacuate. However, you will have to clean vacation homes more frequently.

Banks may differ with their terms depending on what property you are investing in.

Some financial institutions offer stated income commercial loans only for owner-occupied properties. Still, they may also review the borrower’s earnings from rentals or property flipping to see if they are qualified for financial credit.

If you have good credit, stated income commercial real estate loans could help you obtain financing despite being denied mortgages based on underwriting. Examples of such borrowers are immigrants who pool money together with their relatives to buy a home.

What you can do with the loan

A stated income loan may be used to refinance or purchase commercial property. It is more concerned with a piece of real estate instead of your credit history.

However, the property's income value must be able to service the taxes, insurance, and mortgage for the loan to be approved.

One of the advantages of this type of loan over conventional commercial financing is the speedier approval process because fewer documents are involved.

Stated income commercial loans might also make sense if you need cash for your business, if you don’t have proof of income from the last two years, or earn a high commission despite having a low salary.

This type of loan may also make sense if you are applying for a cash-out refinance.

Some lenders might provide a stated income loan for debt consolidation, property improvements, or working capital.

How Private Lenders provide this loan

Loan arrangements will vary per investment type, but you can learn more about them by consulting with the lenders.

Some companies may provide stated income loans for commercial real estate for properties under the asset classes of multifamily, commercial, office, retail, and mixed-use properties.

Occupancy is not required, and the loan size can range from $150,000 to over $5M. Amortization is fixed, ARM, or interest-only.


You need to prepare specific documents and fulfill certain requirements before applying for stated income commercial real estate loans:

  • A credit score of 650 and higher
  • A copy of your driver’s license
  • Bankruptcy(s) outside of two years
  • A copy of your social security card

You also need to disclose the following information:

  • Your address history in the last two years
  • How long you have been staying in your current address
  • Do you currently own or rent? If renting, what is the current rent you are paying each month?
  • Your employment history in the last two years
  • If you are self-employed, state the name of the company you own.
  • Civil status (married or unmarried)
  • Your current job title and how long you have held that title.
  • Number of dependents and their ages
  • Current commercial mortgage statement
  • Hazard insurance DEC page showing the annual premium
  • Credit authorization
  • The purchase agreement, if you require a purchase loan.

We can get you qualified for a stated income commercial loan.

Capital Investors Direct is based in Rockville, Maryland, capable of providing CRE investment advice nationwide.

We provide custom commercial loan solutions, including stated income commercial loans to discerning commercial real estate investors who may not acquire financing through conventional banks.

So far, we were able to help investors obtain the investment capital they need to finance retail and mixed-use properties, apartment complexes, and office spaces.

Apply for stated income commercial real estate loans through Capital Investors Direct.

You do not have to provide us with any income proof, and we’ll make the pre-qualified stated income loan process hassle-free and quick.

We promise flexible and reliable terms, fast approval without any hidden fees, and with fewer documents.

Capital Investors Direct provides loan financing in all 50 states and US territories (US Virgin Islands and Puerto Rico) and top 200 MSA Tier I and Tier II Cities with populations over 50,000, metropolitan areas, and much more.

We are proud to be chosen by our happy clientele for our ability to listen to their needs, apply a simple theory, and do our best and more to deliver.

Together, we provide our years of market knowledge, expertise, and detailed insights to help you go over your commercial real estate investment options and apply for the right loan that suits your needs.

Our approach sets us apart from other stated income commercial loans providers, as we make it investment-specific and customized to your unique investment objectives and goals.

Our team is equipped with the latest finance technology to provide a good selection of investment solutions to your finance requirements.

Rest assured, you are working with qualified CRE placement professionals who understand and evaluate your requirements and circumstances before structuring the right loan that is best for your project.

After getting the financing that you need, we’ll continue to work with you by following up on your project's progress and providing further assistance where needed.

That means by choosing Capital Investors Direct; you have a reliable partner who will walk with you through your investment journey.

To apply for a stated income loan through us, simply fill out the form on our website and wait for us to get back to you within 24 hours.