Alternative Lending & NON-QM Mortgage Guidelines

This Article Is About Alternative Lending & NON-QM Mortgage Guidelines:

The 2008 Real Estate & Lending Collapse of 2008 has completely eliminated the subprime mortgage markets. However, with the creation of alternative lending & non-QM mortgages, many homebuyers and real estate investors can now qualify for non-traditional mortgages.

Borrowers of subprime loans were not able to obtain non-QM loans to purchase homes. Borrowers who did not qualify for conforming traditional loans such as FHA and Conventional Loans were left out of the marketplace to purchase homes. This was due to not having access to Alternative Lending & Non-Prime Mortgages. These borrowers were great borrowers who could afford to make the payments on their mortgage loans. They had the means and income to afford to be homeowners. But due to the non-existence of subprime mortgages, they were stuck being renters in a hot real estate market.

They saw home values appreciate before their eyes. These borrowers had the desire, ability, and means. They were prime candidates for alternative lending and subprime mortgage loans. They were perfect candidates but could not have accessibility to alternative lending and Non-QM mortgage programs now offered by Gustan Cho Associates.

Asset Depletion Mortgage Guidelines

Borrowers with substantial assets and no steady income stream can now qualify for Asset-Depletion Mortgage Programs offered at Gustan Cho Associates Mortgage Group. Income is derived from the assets of borrowers. First and foremost, borrowers need to have 110% of the loan amount balance in assets. Income is derived by taking the liquid assets of borrowers and dividing them by 60 months.

The resulting figure will be the monthly qualifying income. Retirement accounts such as 401ks and IRA can be used. However, 70% of the retirement account balance is used as liquid assets. The liquid assets are then divided by 60 months. The resulting figure is the monthly qualifying income.

Who Benefits From Alternative Lending And NON-QM Loans

Alternative Lending & Non-QM Loans are mortgages for home buyers and real estate investors who may not qualify for traditional conforming financing due to one of the many of the following reasons:

  • Borrowers may not have met the mandatory minimum waiting periods after bankruptcy, foreclosure, short sale to qualify for conforming loans
  • Self-employed borrowers who do not have documented income but have bank statements where they can qualify for bank statement loan program
  • Borrowers who do not qualify for traditional conforming financing due to low credit scores
  • Borrowers who do not meet the mandatory waiting period after bankruptcy, deed in lieu of foreclosure, foreclosure, short sale
  • Other reasons

Non-QM loans are not just for homebuyers with bad credit or other credit issues. Many borrowers with high credit scores and great profiles benefit from non-QM loans.

Types Of Borrowers Who Can Benefit From Alternative Lending & Non-QM Loans

Alternative Lending is ideal for borrowers who have the desire and means to afford to make payments but are not able to get accessibility to subprime loans until now:

  • This is due to the fact that they have a few strikes on their credit or income profile
  • Alternative Lending and Non-QM Loans gives home buyers an opportunity to purchase a home now during a hot housing market
  • They can often use alternative lending as a bridge loan until they get their credit and income profile in order
  • They can then refinance their home loan to a conforming lower interest mortgage at a later date

Non-QM loans are for owner-occupant, second homes, and investment properties.

Booming Housing Market

what is a Rising Home Market

Home Values are skyrocketing in many parts of Illinois, Kentucky, New Jersey, Pennsylvania, Mississippi, Colorado, Michigan, Indiana, Georgia, Florida, Texas, and California as well as the rest of the country. The housing market has started to recover starting in 2010. Home prices have been appreciating where it left non-conforming borrowers out of the housing market and just forced them to become renters. Now with the comeback of alternative financing, these non-conforming subprime borrowers can participate in the housing market. Gives them a chance not to miss out on becoming a homeowner in a hot real estate market.

By all indications, it does not seem like there is a pullback around the corner. Folks who could not qualify for traditional FHA, VA, USDA, and Conventional Loans due to not being able to meet the mandatory waiting period after bankruptcy and/or foreclosure can now qualify with Alternative Financing at Gustan Cho Associates.

Benefits Of Alternative Lending

Alternative Lending Programs are non-prime loan programs geared for home buyers and investment property buyers who do not qualify for government and/or conventional loans:

  • Alternative Lenders all agree that a borrower’s credit scores do not pay for mortgage loans but their income and job stability does
  • Gustan Cho Associates offers non-prime jumbo mortgages along with a variety of alternative financing programs never heard of after the 2008 real estate and mortgage meltdown
  • Prior to the launching of non-prime loans this year, non-prime borrowers did not have a choice of even thinking about purchasing a home
  • They were stuck being renters

Gustan Cho Associates Mortgage Group can now help non-prime borrowers get qualified for a home loan and become homeowners.

Non-Prime Mortgages

Non-Qualified borrowers can now qualify for non-prime loans without waiting the many years required to qualify for prime loans after bankruptcy, deed in lieu of foreclosure, bankruptcy, and short sale. Gustan Cho Associates Mortgage Group offers residential and investment non-qualified mortgages for borrowers who have stable employment and incomes.

Here are some of the subprime and alternative financing offered by Gustan Cho Associates:

Bank Statement Loan Program:

  • For self-employed borrowers where income tax returns are not required
  • Ideal for Self Employed Borrowers
  • If more than one borrower, we will use the primary borrower’s middle credit scores and not the lower of the two borrower’s middle credit scores like prime lenders use

Non-QM lenders are open-minded and can make exceptions on a case-by-case basis as long as the deal makes sense.

Alternative Lending And Subprime Mortgage Programs

what are the Types Of Borrowers Who Can Benefit From Alternative Lending & Non-QM Loans

Here are the alternative lending and subprime mortgage programs offered by Gustan Cho Associates:

  • No waiting period out of foreclosure, short sale, deed in lieu of foreclosure, and bankruptcy
  • Loan Limits up to $1 million
  • Borrowers can have credit scores down to 500 FICO
  • Up to 90% Loan To Value
  • 95% Loan To Value Jumbo Loans With No Mortgage Insurance
  • Debt To Income Ratio up to 50% DTI
  • Owner-occupied, 2nd homes and investment properties ARE eligible for alternative financing
  • Non-warrantable condos considered
  • Jumbo mortgages down to 500 FICO
  • Adjustable Rate Mortgages, ARM, or 30-year fixed
  • No pre-payment penalty for owner-occupant homes and 2nd homes
  • No credit tradeline requirements
  • SFRs, townhomes, condos, 2-4 units on residential and investment properties
  • Seller concessions allowed on owner occupant and second homes up to 6%
  • Investment properties are limited to 2% sellers concessions
  • Asset-Depletion Mortgage Programs

If you are a non-prime borrower and have an interest in alternative financing, please contact us at Gustan Cho Associates at 262-716-8151 or text for a faster response. Or email Gustan Cho at [email protected] The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays. We have a national reputation of being a one-stop mortgage shop. This is due to having every available mortgage product in today’s market. Non-QM loans are becoming very popular for primary owner-occupant homes, second, homes, investment properties, and commercial loans.

Comments: 2

Leave a comment