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Conventional Loans With No Lender Overlays Illinois

Conventional Loans With No Lender Overlays Illinois

This BLOG On Conventional Loans With No Lender Overlays Illinois Was UPDATED On January 9th, 2019

The Gustan Cho Team at Loan Cabin Inc. has no overlays on government and conventional loans.

All of our government and conventional loan programs has no mortgage lender overlays.

  • As long as mortgage borrowers get an approve/eligible per DU Findings from Fannie Mae’s Automated Underwriting System that is all we go by
  • The mortgage loan will get approved as long as the following meets Fannie Mae and/or Freddie Mac Mortgage Guidelines
    • Income
    • Asset
    • Debt
    • Liabilities
    • Credit Scores
    • Payment History
    • Waiting Period After Bankruptcy
    • Waiting Period After Short Sale And/Or Foreclosure
    • Waiting Period After Foreclosure

Unlike other mortgage companies and banks, Gustan Cho Associates at Loan Cabin Inc. has no overlays on government and conventional loans.

No Overlays On Conventional Loans

Now, we offer conventional loans with no lender overlays in Illinois and 21 other states:

  • Conventional Loan Home Buyers require down payment of 5%
  • Mortgage Borrowers need an approve/eligible per DU Findings from Fannie Mae’s and/or Freddie Mac’s Automated Underwriting System

Mortgage Lender With No Lender Overlays

Most Conventional Lenders and Banks have lender overlays.

What Are Lender Overlays?

  • Overlays are additional mortgage lending requirements that is above and beyond those of Fannie Mae and/or Freddie Mac
  • Fannie Mae and Freddie Mac sets the mortgage guidelines on Conventional Loans
  • Conventional Lenders do have to meet the minimum mortgage lending requirements from the Automated Underwriting System but are allowed to set higher standards

The Gustan Cho Team at Loan Cabin Inc. has no overlays on Conventional Loans as well as government loans.

Government Loan Programs

Here are the three government loan programs:

  • FHA Loans
  • VA Loans
  • USDA Loans

Getting Approve/Eligible Per AUS FINDINGS

  • Fannie Mae and/or Freddie Mac has higher lending requirements than FHA, VA, USDA Loans insured mortgage loans
  • Waiting periods after a bankruptcy and foreclosure are as follows:
    • 4 year waiting period after recorded date of deed in lieu of foreclosure and/or short sale 
    • 4 year waiting period after Chapter 7 Bankruptcy discharged date
    • 2 year waiting period after Chapter 13 Bankruptcy discharged date
    • 4 year waiting period after Chapter 13 dismissal date
    • 7 year waiting period after recorded date of foreclosure
  • Minimum credit scores for conventional mortgage loan programs is 620
  • Debt to income ratio requirements for conventional loan programs are normally capped at 50% to get an approve/eligible per automated findings
  • Cap on FHA insured mortgage loan programs can be as high as 56.9%

All of these lending criteria will be picked up by Fannie Mae’s Automated Underwriting System and the results will be given per DU Findings

Mortgage Rates On Conventional Loans

Conventional loans mortgage rates are normally 0.50% higher than FHA insured mortgage loan mortgage rates.

  • Biggest advantage with conventional loans is that mortgage insurance is not required if you as a borrower can put 20% down payment
  • Home Buyers who put less than 20% down payment, private mortgage insurance will be required on Conventional Loans
  • Private Mortgage Insurance (PMI) rates vary depending on borrower’s credit scores
  • FHA MIP is flat at 0.85% of the FHA Loan Balance Amount

Cases Where Home Buyers Qualify For Conventional Mortgage But Not FHA

There are cases where home buyers will qualify for Conventional Loans BUT NOT FHA Loans. If a home buyer had a mortgage as part of Chapter 7 Bankruptcy, the waiting period on Conventional versus FHA Loans are different.

Here is how it works:

  • There is a four year waiting period after Chapter 7 Bankruptcy to qualify for Conventional home loans
  • If a borrower had a mortgage or multiple mortgages as part of Chapter 7 Bankruptcy and those mortgages were not reaffirmed, they can qualify for Conventional Mortgage four years from the discharged date of the Chapter 7
  • However, the housing event needs to be finalized via:
    • Foreclosure
    • Deed In Lieu Of Foreclosure
    • Short Sale

HUD Guidelines On Mortgage Included In Bankruptcy

With FHA Loans, home buyers can qualify for FHA Loans if they had mortgage part of Chapter 7 Bankruptcy under the following circumstances:

  • Three year waiting period after recorded date of foreclosure and/or deed in foreclosure after the discharged date of the Chapter 7
  • Three year waiting period after the short sale date after the Chapter 7 Bankruptcy discharged date

There are many instances where home buyers qualify for Conventional Loans BUT NOT FHA Loans due to the above guidelines.

Conventional Loans With No Lender Overlays Specific Products

Self Employed Borrower(s) with ONLY 1 Year Tax Returns are now eligible as long as we get approval per DU Findings.

  •  (1099 and Schedule C borrowers included where LP indicates only 1 Year  Tax Returns Required)
  • Use Retirement Assets to Qualify as Income
  • Non-Qualifying Co-Borrower(s)Conventional and FHA to Qualify
  • Up to 10 Financed Properties
  • Lender Paid MI to 95% LTV with 620 FICO Scores
  • Unlimited HARP 2.0 with Freddie & Fannie, including N/O/O and Condos
  • Cash Out with Properties Currently Listed on MLS
  • We accept Appraisal Transfer from all Appraisal Management Companies
  • No landlord History needed to Qualify with Rental Income
  • Condo Spot Approvals
  • Professional College Graduate Home Program (1 Paystub)
  • No Conventional Overlay Matrices to Decipher, Your AUS Approvals are Your Guidelines

Refinancing FHA To Conventional To Avoid FHA MIP

There are many homeowners who purchased their home several years ago with FHA Loans.

  • Many homeowners in Illinois, California, California, Ohio, Kansas, Alabama, Georgia, Texas, New Mexico, Arizona, Arkansas, Minnesota, Wisconsin, Michigan, Iowa, Colorado, and other parts of the country has seen their home values increase year after year
  • Many homeowners have seen their property values increase where they have over 20% plus in home equity where they can refinance their current FHA Loans to a Conventional Mortgage
  • By doing so, they can eliminate the hefty FHA Mortgage Insurance Premium

The Gustan Cho Team at Loan Cabin Inc. has no lender overlays on government and conventional loans. Home Buyers needing to qualify for home loans with a direct lender with no overlays, please contact The Gustan Cho Team at Loan Cabin at 262-716-8151 or text us for faster response. Or email us at gcho@loancabin.com. We are available 7 days a week, evenings, weekends, and holidays.

This BLOG On Conventional Loans With No Lender Overlays Was UPDATED On January 9th, 2019

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