Stated Income / Stated Asset Mortgage - SISA

A type of reduced documentation mortgage program which allows the borrower to state on the loan application what their income and assets are without verification by the lender; however, the source of the income is still verified.

SISA loans usually fall into the Alt-A classification, and may carry a higher interest rate than a prime mortgage. Self-employed borrowers often use SISA loans because their tax returns might not reflect that actual cash flow they have available to pay their mortgage. Other borrowers might use a SISA loan because their income comes from sources which are hard to document (such as tips in the food service industry). Some lenders may require the borrower to sign a form authorizing the lender to obtain a copy of the borrower’s tax returns from the IRS should the borrower default on the mortgage.