2020 Mortgage Guidelines Update

2020 Mortgage Guidelines Update During Coronavirus Pandemic Crisis

Gustan Cho Associates are mortgage brokers licensed in 48 states

BREAKING NEWS: 2020 Mortgage Guidelines Update During Coronavirus Pandemic Crisis

2020 Mortgage Guidelines Update
Gustan Cho Associates

Since it has been a few days since we have given our readers an update, this blog will highlight some changes we have seen in the mortgage industry over the past week.

  • We will also give a quick coronavirus COVID-19 update
  • Many of our loyal readers have been following our site very closely during these uncertain times
  • We are seeing an increase in mortgage applications for borrowers with credit scores below 660, which many lenders are no longer offering
  • The mortgage market is not in the best place with this pandemic

In this breaking news article, we will discuss and cover the 2020 Mortgage Guidelines Update During Coronavirus Pandemic Crisis.

2020 Mortgage Guidelines Update During Coronavirus Pandemic Crisis For Homebuyers

2020 Mortgage Guidelines Update Due To Coronavirus Economic Shutdown:

  • Last week we saw President Trump issue guidelines on a three-tiered approach for individual states to start easing coronavirus stay at home restrictions
  • Many states have given backlash while other states have already embraced the loosened restrictions
  • The key to opening our States back up seems to be ample COVID-19 coronavirus testing
  • We have already seen some states such as Texas, Georgia, and South Carolina lift their stay-at-home orders while others are taking a more strict approach
  • Protests have begun throughout the United States in areas such as Michigan, Colorado, Arizona, California, and Illinois
  • Many citizens feel like their freedoms have been stricken from them
  • This is not a good feeling and historically speaking, does not have positive outcomes
  • Many Americans are upset with their state and local officials as well as the federal government
  • Many small business owners are hurting and need to see a date of getting back to business
  • States such as Michigan had large protests against Governor Gretchen Witmer’s stay at home order
  • Witmer told citizens the next 10 days are critical for the future
  • We want things to clear up before getting ugly
  • As individual states will start to open, we hope to see a positive domino effect through our Nation’s economy
  • In the next coming days, we should see individual states release plans for slowly reopening their economies

We hope to see more businesses allowed to serve their communities.

2020 Mortgage Guidelines Update On Loan Programs AT Gustan Cho Associates

Gustan Cho Associates Mortgage Product Updates:

  • FHA credit score requirements- We are still going down to 500 scores with 10% down for FHA loans
  • While most banks have dramatically increased credit score requirements on FHA mortgages, a few of our investors have not added any additional requirements
  • We are still able to close FHA mortgages all the way down to a credit score of 500
  • Please keep in mind, credit scores between 500 and 579 require a 10% down payment
  • Any credit scores above 580, only require a 3.5% down payment
  • For more information on qualifying for an FHA loan, please see this FHA BLOG
  • With the mortgage market all over the place due to the global economy, some investors are requiring borrower-paid compensation for lower credit score files
  • This may not apply to every FHA (and VA loan file)
  • However, it is a growing trend

Please see the article on BORROWER PAID mortgage compensation for more information.

VA Mortgage Guidelines During Coronavirus Pandemic Crisis

What are the VA guidelines for mortgage loans during the coronavirus pandemic crisis?

There is no minimum credit score requirement on VA loans:

  • With most mortgage companies at capacity, our call volume is through the roof
  • Many veterans are calling us about credit score requirements
  • Many of our investors have raised the minimum credit score requirements due to the COVID-19 coronavirus outbreak
  • However, not all of our investors have
  • We still do not have a minimum credit score requirement for VA mortgages

So we are able to lead to more veterans than most banks or lending institutions.

2020 Mortgage Guidelines Update On Non-QM Loans

NON-QM starting to slowly resurface:

  • If you have been following our COVID-19 coronavirus outbreak blogs, you will already know that NON-QM mortgage lending came to an abrupt stop a few weeks back
  • We are starting to see a few NON-QM loan products roll back out
  • These programs are in the beginning stages and require a significant down payment
  • Our investors are currently requiring a 25% to 35% down payment for NON-QM mortgage loans
  • This is a significant step in the right direction
  • I am sure once the economy shows some stabilization, the down payment requirements will be lowered

We may even see alternative income products, such as bank statement loans, make a comeback in the near future. Please continue to follow our blogs for more information.

Federal Agency Mortgage Guidelines Versus Lender Overlays

What are the guidelines of a federal mortgage agency and lenders overlays

In these uncertain times, we still feel lucky to be able to offer loan programs without LENDER OVERLAYS.

  • The mortgage industry is changing rapidly
  • We hope to have Americans safely back to work as soon as possible so everybody can get back to life as we knew it
  • Deep down, this has the opportunity to bring Americans together and the world together
  • Everybody throughout the planet has sacrificed in order to tackle this pandemic
  • As States and other countries loosen their stay-at-home requirements, we should see a stabilization in the global economy
  • Well, we will be slowly adjusting back into society; we hope for the best outcome
  • We do not want to see a new spike in COVID-19 cases and deaths

It will be interesting to see how the first States do with the loosened restrictions.

Over 75% Of Our Borrowers Could Not Qualify For A Mortgage Elsewhere

As many mortgage companies have tightened up their qualification requirements, we have not. If you have been turned down by your current lender, please give us a phone call. Please call Mike Gracz on 630-659-7644 or email mgracz@gustancho.com. You may be running into an overlay or an added overlay due to the COVID-19 coronavirus outbreak. Even before the pandemic, 75% of our clients were turned down by their current lender. Many times, we are able to save the day. Please check out our reviews and subscribe to our YouTube CHANNEL.

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