Mortgage without proof of income: which banks give loans without proof of income

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The following Russian citizens fall into this category:

• employees of Russian organizations, officially registered, but receiving the majority of their salary in an envelope;
• citizens who have a stable income, but do not have official employment (this includes, for example, freelancers);
• self-employed and individual entrepreneurs whose income cannot be calculated with maximum accuracy.

Requirements of banks for borrowers

Lenders evaluate future mortgage holders based on a number of criteria:

• solvency - the level of monthly income, the ability to officially confirm your income;
• financial stability - length of service at last place of work, total length of service, average annual earnings;
• social status - age and professional type of activity;
• family status - presence of a spouse, children, dependents;
• availability of savings - cash for a down payment, real estate and other expensive property owned;
• clean credit history - no delinquencies, credit card limits, no problems with credit history in immediate family, the borrower’s integrity in the past;
• availability of solvent and reliable guarantors and co-borrowers;
• absence of problems with the law in the present and in the past;
• the user’s activity on social networks, the content of the content in which the user is interested - sometimes a person’s profile can tell much more about him than official documents.

Based on the analysis of the listed data, the underwriter makes a positive or negative decision on the application. Also, the scoring result is influenced by factors that the borrower himself cannot influence:

• the credit policy of the Central Bank at the time of application - the presence of special recommendations regarding the screening of potential mortgagers;
• the credit policy of the bank itself, where the client applies;
• terms of the mortgage program chosen by the client.

Is it possible to take out a housing loan if there are no documents proving official employment? There are no direct prohibitions in the mortgage law that would limit the issuance of loans to officially unemployed persons. However, the borrower will have to resort to additional measures to convince the bank of its own financial stability. This issue is especially acute for freelancers who receive their main income and do not have an entry in their work book. In Russia, the share of self-employed people at the beginning of 2020 is about 20% of the total working population. This is a very large number of solvent and responsible people who have their own needs. For freelancers, there are several ways to increase your chances of getting a mortgage approved:

• Choose lending programs that provide proof of income on the bank form. Agree with key clients so that they confirm your monthly income from cooperation with them when communicating with a bank employee.
• Agree with key clients so that they confirm your monthly income from cooperation with them when communicating with a bank employee.
• A mortgage based on two documents is a simplified way to get money for housing without unnecessary paperwork. You will still have to indicate the employer’s details in the application form, and an agreement with key clients with whom the freelancer has long-standing and stable relationships will also help.
• When submitting documents to the bank, present an agreement on the provision of services with important customers, a statement of the flow of funds in your personal account and a tax return for the last reporting period. These documents will help demonstrate that you earn regular income and are a responsible taxpayer.

What should I do to get the bank to approve my application?

To increase your chance of getting a mortgage while working informally, you should prepare carefully. The following may influence the bank's decision:

• Owning real estate or a vehicle.
• Providing a certificate confirming the possibility of making a down payment. This could be a bank account statement.
• Positive credit history. If you have taken out loans before and paid them off without problems, this will increase your chances of getting a mortgage.
• Confirmation of monthly cash receipts, for example, a bank statement.

If you are unemployed, you can also turn to credit brokers for help. These specialists will help you successfully obtain a mortgage on mutually beneficial terms.

What documents are required to apply for a mortgage?

The first step to getting a loan is choosing a suitable bank and submitting an application for a loan. Sberbank, for example, has an online document submission system, where you need to take high-quality photographs of all the necessary papers and attach them to the application form in your personal account. This semi-automatic scoring is most convenient for busy clients. However, it should be borne in mind that the absence of a minimum continuous work experience at one place of work at the time of filing an application means almost 100% refusal at this financial institution. For clients without official employment, Sberbank is not the best choice, unless the mortgage amount is 10-20% of the cost of housing.

If you cannot officially confirm your income, choose to submit documents in person to a bank manager. Although this is only the first link of the banking machine, there is a chance to use the personal factor to increase your chances. A typical package of documents for obtaining a mortgage looks like this:

• completed borrower application form;
• borrower's passport;
• employment documents: work record book, current employment contract, contract for the provision of services;
• proof of income: if this is a certificate in a bank form, it must be endorsed by the employer. Also, a long-term lease agreement for the borrower’s own office space and other documents confirming the fact of his work activity can serve as proof of income;
• documents on marital status: marriage certificate, birth certificates of children;
• military ID - for men liable for military service.

All co-borrowers must present similar documents to the lender. If the co-borrower’s income is not taken into account, documents on his solvency are not needed. As additional documents, the bank may request:

• certificates of ownership of the housing provided as collateral and its appraisal by an appraiser accredited by the bank;
• tax returns for the last year, a contract for the provision of services and statements of the movement of funds on the client’s personal account - to confirm income from self-employment.

After approval of the application, you will also need to provide documents on the subject of the mortgage. In this case, the buyer usually pays for the real estate appraisal; the seller must provide the remaining documents to the bank. If, based on the results of the real estate assessment and consideration of the application, the bank has approved a sufficient amount to complete the purchase and sale transaction, the client becomes the borrower and owner of his own apartment. The apartment itself remains pledged to the bank for the term of the loan.

Additional set of real estate documents

After you choose a credit bank, read the terms of the loan, fill out the form, collect the necessary documents, and you can submit them for review. All documentation must be photocopied. The more impressive the package of documents for the collateral property, the greater the likelihood of a positive decision from the bank.

Look at the same topic: Buying an apartment with a mortgage in a building under construction: step-by-step instructions %%current_year%% of the year

What documents need to be prepared:

• Conclusion of the company's specialists for housing assessment.
• Conclusion from the BTI, cadastral passports.
• A contract provided by the seller, subject to the acquisition of secondary real estate. Documents confirming the legal ownership of the property by the seller.
• Certificate from the Unified State Register no more than 30 days old.
• Home insurance, but here the decision to provide an insurance policy and its type remains with the bank.
• A pre-drafted purchase and sale agreement in which the borrower acts as the buyer.

Mortgage conditions without verified income

The most popular loan product without a 2-NDFL certificate is a mortgage based on two documents. Lending conditions for 2021 using the example of a program from VTB Bank called “Victory over formalities”:

• loan amount from 600,000 rubles;
• loan term up to 20 years;
• interest rate from 11.1% (if you agree to comprehensive insurance);
• the first payment for a new building is from 30%, for a secondary building from 40%.

The conditions differ from the standard mortgage lending parameters for salary clients and citizens who can confirm their income. But checking documents takes very little time, and the decision is communicated quickly.

Another loan product that does not require proof of income from the borrower is a mortgage secured by existing housing. Its main disadvantages are that for the duration of the loan you cannot make transactions with collateral housing, moreover, the loan amount rarely exceeds 50% of the appraised value of the property. And this greatly limits the buyer’s options.

How to indirectly confirm income?

There are several options to confirm solvency without 2-NDFL certificates or using a bank form. They will be useful to freelancers, people who make a profit from renting out property, individual entrepreneurs on “imputation”, and self-employed citizens.

You can provide the bank with:

• a current account statement confirming the stable receipt of significant amounts. It is best to apply for a mortgage at your own bank, where accounts and debit cards are opened. As a supplement, you can present documents indicating the presence of deposits, deposits, etc.;
• agreements confirming the rental of personal real estate: retail premises, apartments, warehouses, production workshops. In the optimal case for the borrower, the agreements are properly registered in Rosreestr, and at the end of each year, a 3-NDFL declaration is submitted to the Federal Tax Service at the place of registration;
• invoices, invoices, bank statements. This option is acceptable for individual entrepreneurs working on imputation. They can have multi-million dollar turnover, but are required to pay a strictly fixed amount to the budget.

Recommended article: What is more profitable to take out a mortgage or a consumer loan

There are many ways to confirm solvency. It is better to find out specific conditions in the bank where you plan to take out a mortgage without official income.

Which banks give mortgages without proof of income?

Not all credit institutions are ready to provide money for housing to clients without official income. However, there is a choice: competition forces bankers to be more loyal to borrowers. Current loan offers:

• VTB, already mentioned above, is the “Victory over formalities” program;
• Alfa Bank - mortgage under two documents from 8.49% for a period of up to 30 years with an initial payment of 10%;
• Svyaz-Bank - involves issuing a loan without proof of income, but only for a new building from accredited construction partner companies and only in the regions where the bank operates;
• UniCredit - mortgage terms are determined individually, but not lower than 15% of the down payment and 8.9% per annum.

Pros and cons of a mortgage without proof of income

Before taking on such a responsible debt obligation, you need to weigh all its advantages and disadvantages. Let's start with the attractive aspects of a mortgage:

• the opportunity to move into your own home without years of savings;
• investing money not in renting an apartment, but in your own home;
• You can rent out an apartment with a mortgage and pay the bank with this money if you do not plan to move into a new home;
• investing in real estate today is the most reliable way to preserve and increase your capital;
• children can be enrolled in a school or kindergarten at their new registration address, rather than being transferred from one educational institution to another with each new change of rental housing.

Despite all the advantages, mortgages for citizens without official income have significant disadvantages:

• The loan term is shorter than for clients with an official salary. The monthly payment increases, and therefore the bank requires a higher monthly income to approve the loan;
• rates are higher by 1-1.5%, and this is a significant increase in overpayment;
• high down payment of 30%. Most banks do not consider maternity capital as a down payment for mortgage programs without proof of income;
• the bank can approve an amount 10-20% lower than what is needed to purchase the chosen home, thus insuring against risks.

Even with such a solid list of disadvantages, a mortgage still turns out to be more profitable than a long-term lease while simultaneously trying to save up to buy a separate apartment.

Mortgaged property

Any banking organization will try to reduce risks to a minimum. There are statistics confirming that mortgages without income documents are sought by those people who do not have the ability to repay the loan. This kind of reasoning: “The main thing is that they give a mortgage, and then we’ll get housing and somehow cope,” sometimes costs both the citizens themselves and the banks dearly. To protect their capital, banks require real estate insurance; after insurance is issued, the purchased home becomes, in almost all cases, the bank’s collateral.

Not all banking organizations undertake such experiments, and not all real estate can be recognized as collateral. “Khrushchevs” and “Stalins”, most domestic cars are not considered by banks as collateral for real estate.

Also, seized property encumbered by any circumstances with the registration of minors is not taken into account.

How to increase your chances of getting a mortgage approved

There are typical tips on how to increase your credit attractiveness in the absence of official employment:

• save up half the cost of the apartment and pay it as a down payment;
• find a co-borrower or guarantor with a good credit history and high income;
• offer the bank additional collateral - real estate you already own.

But all these recommendations have a downside:

• Given existing obligations to pay for a rented apartment, saving money for a down payment is quite difficult, and sometimes almost impossible;
• If you put off buying an apartment for a year or two, you can wait for a serious tightening of loan conditions or an increase in interest rates
• Finding a guarantor even among relatives is very difficult. The guarantor does not have material rights to the mortgaged housing, but in the event of financial insolvency of the payer, it can become the main target for creditors. Few people accept such a role. A co-borrower is a co-owner, and ownership of the mortgaged apartment will be registered in the name of all co-borrowers. This may not suit the main payer;
• The downside of a secured mortgage is that the bank issues a loan to the client in the amount of about 60% of the real cost of housing (maximum - 80%). This money may not be enough to purchase the selected property.

The situation becomes more complicated when a bad credit history is added to the lack of an official source of income. However, even if there are serious stop factors and refusals already received, you should not give up. A mortgage broker will help you solve this problem. Home lending specialists know the market well and have direct connections with bank management. Due to this, the mortgage broker's client receives loan approval, bypassing the complex underwriting system. Services provided by a mortgage broker:

• preparation of documents and submission of applications to banks;
• guaranteed approval;
• favorable conditions from partner credit institutions;
• assistance in conducting a purchase and sale transaction;
• assistance in choosing housing in accordance with bank requirements;
• assistance in obtaining mortgage loans even in the presence of stop factors.

Using a mortgage broker can save you time and money with discounted partner mortgage rates. Therefore, the costs of paying for brokerage services always pay off. In this case, the client receives what he needs - his own real estate and a loan on favorable terms.

Housing loan terms

In 2021, Sberbank is offering simplified mortgage terms without income certificates:

1. Advance payment – ​​50%.
2. The minimum loan amount is RUB 3,00,000.
3. The maximum limit is 15,000,000 rubles for Moscow or St. Petersburg, 8,000,000 rubles for regions of the Russian Federation. The conditions apply when co-borrowers are involved.
4. Duration – 1…30 years.

You can get a mortgage at Sberbank without proof of income

Program overview

Purchase of finished real estate.

Lending for housing under construction.

Allowances:

• +1% – if you refuse personal insurance;
• +0.5% for clients who do not receive a salary from Sberbank.

Additional expenses:

1. Appraisal of an apartment in Moscow is 3500-4000 rubles, St. Petersburg - 3000...3500 rubles.
2. Personal insurance – 900...4500 rub.
3. Real estate insurance – 0.12%...0.25% of the mortgage amount.
4. State registration of a mortgage, including entering real estate rights into the Unified State Register of Real Estate, records of encumbrances - 1000 rubles.
5. Providing certificates about the repayment amount, the balance of the debt - 0 rubles.
6. Informing about credit rates when placing credit resources – 250 rubles.
7. Issuance of copies of documents (including contracts) – 250 rubles.
8. Correction of information in the loan agreement – ​​0 rub.
9. Making amendments to the contract when changing collateral at the client’s request – RUB 3,000.

When registering the purchased living space via the Internet, a reduced percentage is offered