Stated income mortgage loans, also known as “liar loans,” are mortgages where the borrower is not required to document their income or employment. Instead, the borrower simply states their income on the loan application. These types of loans were popular before the 2008 financial crisis, but are now largely unavailable due to stricter lending standards put in place to prevent fraud and protect lenders from default. To qualify for a stated income mortgage loan, borrowers typically need to have a good credit score and a significant amount of assets to use as collateral. They may also be required to make a larger down payment than with a traditional mortgage.
