A Liar Loan is a type of mortgage loan in which the borrower is allowed to take out the loan without providing standard documentation to prove income, employment, or assets. These loans were quite prevalent during the housing bubble of the mid-2000s and significantly contributed to the subsequent financial crisis due to their risky nature.
A no-documentation loan (often referred to as a 'no doc' loan) is a mortgage loan for which the borrower is not required to provide proof of income, employment, or assets.
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