A no-documentation home loan is a mortgage that doesn’t require the borrower to provide standard income documentation.

In lieu of pay stubs, W-2 forms and tax returns, lenders may accept bank statements as proof of income. They will also order a property appraisal to check the resale potential of the investment. This type of loan is instead approved on a declaration that confirms the borrower can afford the loan payments. No doc mortgages are commonly given to those whose incomes aren't easily verified.

Extra consumer protections make today’s no-doc loans a viable option for people with nontraditional income or those who have complicated tax returns.