No Documentation (No Doc) Mortgages: How It Works, Types

A no documentation (no doc) mortgage does not require traditional income verification, relying instead on a borrower's declaration of repayment ability. These loans, often given to self-employed or irregular income earners, are higher risk and now largely illegal due to regulations like the Dodd-Frank Act. Modern lenders may accept alternative documents such as bank statements but require higher down payments, excellent credit, and thorough financial vetting.