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NINA Loans: What No-Income-No-Asset Loans Are and How They Work

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Content was accurate at the time of publication.

No-income-no-asset (NINA) loans require less documentation than your typical mortgage loan. They allow for loan approval without the mortgage lender first needing to verify your income or assets. But as you might imagine, a NINA loan comes with a fair amount of risk, and it’s often cited as a major contributing factor to the 2007-08 financial crisis.

While these loans are no longer available in the same form they were before the housing crisis, they’re still around today as investment loans. Here’s what you need to know about NINA loans and their place in history.

A no-income-no-asset (NINA) loan is a specialized type of mortgage loan program. With this loan type, the borrower can be approved without the standard income and asset documentation paperwork that’s required by traditional mortgage programs, like conventional loans. This means you don’t need pay stubs, tax forms or bank statements for preapproval. However, in this case, the lender will verify your employment status before the loan is finalized.

NINA loans are considerably different from alternative lending programs that have popped up in recent years, including bank statement loans that allow lenders to use a 12- to 24-month average of cash deposits into your bank accounts to prove your income instead of tax returns.


NINA vs. NINJA loans

A NINA loan is a type of NINJA loan. The acronym “NINJA” refers to “no income, no job, no assets” — in a NINJA loan, lenders issue a mortgage based mainly on the borrower’s credit score.

History of NINA loans

Before the 2007-08 financial crisis, NINA loans were commonly used to buy or refinance owner-occupied homes. Originally intended for self-employed borrowers and those with incomes that were difficult to verify, approval for a NINA loan was typically based on a declaration from the borrower, stating that they had the financial ability to repay.NINA loans and other no-doc mortgage programs were major contributors to the housing market crash. Following the crash, government regulators passed new laws requiring lenders to verify that borrowers could afford to repay their loans and, until recently, borrowers couldn’t get NINA loans.

Federal “ability-to-repay” rules are meant to protect borrowers who are buying or refinancing a primary residence, second home or vacation home. However, regulators left some wiggle room in the guidelines for rental property loans.

Mortgages for investment properties fall under this exception, which gives lenders the ability to decide qualifying guidelines. The biggest safeguard: Lenders must verify the property will generate enough monthly rental income to offset the mortgage payment.

If you’re going to go this route, you’ll need to meet very specific requirements to qualify for a NINA loan. It’s also worth considering the risky features that accompany this loan type.

  • You may need a higher credit score to qualify. Most NINA lenders may require a higher credit score than might be required with a traditional loan. In some cases, they may require a minimum score as high as 700.
  • You’ll probably need a bigger down payment. Expect to make at least a 20% down payment. If your credit score is on the lower end, you may need to put down 30%.
  • You’ll qualify based only on the rental income. Although you won’t need to prove any personal income, the potential rent on the home you’re buying must be high enough to at least cover your new PITI (principal, interest, taxes and insurance) payment.
  • You’ll likely pay higher interest rates. No-income mortgage lenders charge higher mortgage rates than traditional loan programs.

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The most common risk that comes along with a NINA loan is taking out a mortgage you can’t afford. During the 2007-08 financial crisis, predatory lenders used these loans to approve mortgage applications for borrowers who wouldn’t otherwise qualify for a loan. Many borrowers couldn’t afford their homes and ended up defaulting on their mortgages as a result.

This type of loan is also commonly used in mortgage fraud schemes. With that in mind, be wary if you’re encouraged by a loan officer, real estate investment group or even a friend or relative to take out a NINA loan on the promise of getting paid a fee or a guaranteed return on your investment.

Also known as “straw buyer” schemes, this scam involves finding a buyer who meets the credit score requirements to apply for the NINA loan. Meanwhile, the funds for the purchase actually come from a source that intends to manage or own the property. If you think you’re being targeted, report it online to the FBI.

FHA streamline refinance

If you currently have a loan insured by the Federal Housing Administration (FHA), an FHA streamline refinance allows you to reduce your mortgage rate without verifying your income or employment.

 See current FHA loan rates today.

VA interest rate reduction refinance loan

Military borrowers who have a loan guaranteed by the U.S. Department of Veterans Affairs (VA) and have made on-time payments can refinance with no income or asset documentation using the VA interest rate reduction refinance loan (IRRRL) program.

 See current VA mortgage rates today.

USDA streamlined assist refinance

Rural homeowners with existing loans backed by the U.S. Department of Agriculture (USDA) can improve the terms of their loan through a USDA streamlined assist refinance, without facing a credit review or providing income paperwork.

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