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| {{anchor|Ninja loan}} | {{anchor|Ninja loan}} | ||
| A '''NINJA Loan''' is a type of ]. It was described as '''No Income, No Job, (and) no Assets''' loan because only things applicant had to show was his/her credit rating. The phrase was coined by |
A '''NINJA Loan''' is a type of ]. It was described as '''No Income, No Job, (and) no Assets''' loan because only things applicant had to show was his/her credit rating. The phrase was coined by Charles M. Morris in his book The Trillion Dollar Meltdown, which went to press March 3, 2008 with the manuscript being written in November 2007. They were especially prominent during the ] of the 2000s but have gained wider notoriety due to the ] in July/August 2007 as a prime example of poor lending practices<ref></ref>. The term grew in usage during the 2008 financial crisis as the sub prime mortgage crisis was blamed on such loans. It works on two levels - as an acronym; and allusion to the fact that ninja loans are often defaulted on, with the borrower disappearing like a ]. | ||
| ==See also== | ==See also== | ||
Revision as of 03:49, 20 May 2011
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- For other uses of the term "NINA", see Nina
No Income No Asset (NINA), "No Income No Job or Asset" (NINJA) or simply Nina Loan is a term used in the United States mortgage industry to describe one of many documentation types which lenders may allow when underwriting a mortgage.
NINA programs are reserved for the most credit-worthy of borrowers. This means, among other criteria, a satisfactory mortgage history paid As Agreed (no mortgage lates in the last 24 months), a minimum credit score of 660 and a Loan to Value ratio of no more than 75%. For higher loan amounts the minimum credit scores start above 700 and LTV ratios cap out at about 60%.
Income requirements
Borrowers must also be able to verify they have some source of income based on their status:
Self-Employed
The most common way to show a source of income is a current business license. However, in cases where borrowers do not have a business license they must provide the lender with a letter from their Certified Public Accountant which vouches for the borrowers ability to generate earnings as the CPA has prepared their taxes in the past.
Stated-Wage Earners
The official title for salaried individuals who cannot present W-2's or pay check stubs. A verification of employment (VOE) must still be sent to the borrower's place of employment, where an authorized agent of the employer must verify the borrower is gainfully employed but is not asked to disclose any compensation.
Fixed-Income
In some cases individuals who are receiving some sort of stipend, such as Social Security, disability or pensions, are able to qualify for NINA programs. Lender criteria may vary, but in many cases it amounts to a benefit letter from the payor being provided to the lender which outlines the type of benefit paid. In this letter the amount is either not included or blacked out by the borrower.
No Income No Job no Assets
A NINJA Loan is a type of subprime loan. It was described as No Income, No Job, (and) no Assets loan because only things applicant had to show was his/her credit rating. The phrase was coined by Charles M. Morris in his book The Trillion Dollar Meltdown, which went to press March 3, 2008 with the manuscript being written in November 2007. They were especially prominent during the United States housing bubble of the 2000s but have gained wider notoriety due to the subprime mortgage crisis in July/August 2007 as a prime example of poor lending practices. The term grew in usage during the 2008 financial crisis as the sub prime mortgage crisis was blamed on such loans. It works on two levels - as an acronym; and allusion to the fact that ninja loans are often defaulted on, with the borrower disappearing like a ninja.
See also
References
External links
- Template:Dmoz
- HCL Finance's ninja loan application form
- 'No Money Down' Falls Flat - Washington Post
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