NON-QM Cash-Out Debt Consolidation Refinance With 90% LTV

NON-QM Cash-Out Debt Consolidation Refinance With 90% LTV

This BLOG On NON-QM Cash-Out Debt Consolidation Refinance With 90% LTV Was Published On November 27th 2018

NON-QM Cash-Out Debt Consolidation Refinance Explained:

The housing market is hot despite rising mortgage rates.

• Nationwide, home prices have been steadily increasing year after year since 2010.
• Most of Florida, Texas, Georgia, California, Colorado, New Jersey, Indiana, Pennsylvania, Kentucky, Mississippi, Michigan, Illinois have seen home values increase double digits
• Many homeowners are thinking of consolidating all of their debts by doing cash-out refinancing
• Consumers are paying credit card interest rates north of 20%
• Many consumers have car payments that are higher $500 per month
• Gustan Cho Associates Mortgage Group at Loan Cabin Inc. now offers NON-QM Cash-Out Debt Consolidation Refinance up to 90% LTV

Difference Between NON-QM Cash-Out Debt Consolidation Refinance Versus Traditional Cash_Out Refinance

Many homeowners who purchased their homes a few years ago have seen their values appreciate double digits.

NON-QM debt consolidation refinance is similar to traditional cash-out refinancing with one exception. With NON-QM Cash-Out Debt Consolidation Refinance, the loan to value is higher. Bottom line is more money for homeowners.

Debt consolidation is not always a fun subject to talk about.

• Around the holidays many Americans sink deeper into their debt problems
• Traveling to see family or buying gifts, the holiday season can be costly
• There are numerous different reasons Americans find themselves tangled in debt
• Sometimes a catastrophic event such as a car accident or unexpected medical expenses, or sometimes we are to blame with poor budgeting skills
• No matter what the reason for being in debt is, you want to get out of debt as soon as possible
• Many Americans are sitting on a gold mine of equity in their homes but are unable to tap into it due to credit scores or late payments
• Obtaining a second mortgage in the year 2018 is next to Impossible
• It looks like that trend will continue into the future
• The good news is, even if your credit is whacked we still have mortgage loans available for you
•  Gustan Cho Associates at Loan Cabin Inc. carry a full line of NON-QM mortgage products
• We will explain these in more detail below

What Are NON-QM Versus QM Mortgages

What is a NON-QM mortgage?

• QM stands for qualified mortgage
• Just like it is spelled, it means a non-qualified mortgage
• For more information on what a qualified mortgage is please see our blog explaining a QM MORTGAGE
• In short a NON-QM mortgage does not follow Fannie Mae, Freddie Mac, VA or HUD guidelines for mortgage qualifications
• They have their individual set of guidelines
• These guidelines are black and white
• We can get exceptions and have a gray area when it comes to underwriting
• This opens up mortgage opportunities to many Americans who cannot qualify for your everyday conventional financing

Debt Consolidation Versus Cash-Out Refinance Loans

What is the advantage to a debt consolidation loan versus a cash-out refinance?

• Most homeowners who do a cash-out refinance mortgage intend on paying off debt with the proceeds
• Why not go the extra mile with NON-QM Debt Consolidation Cash-Out Refinance versus traditional cash-out
• Doing so, homeowners with 680 credit scores can go up to 90% Loan To Value

LTV On NON-QM Cash-Out Debt Consolidation Refinance Versus Traditional Cash-Out Refinance

With NON-QM mortgage loans there is a major advantage.

• That advantage is the maximum loan-to-value thresholds
• With a cash-out NON-QM Loans, borrowers are capped at 80% loan to value
• But if you were to do a debt consolidation refinance, borrowers are capped at 85% loan-to-value
• That extra 5% can mean getting out of a debt faster!
• For credit score 680 and above borrowers can go up to 90% loan to value for a debt consolidation NON-QM mortgage
• That’s right, 90% loan-to-value, that is unheard of in the mortgage industry
• When completing a debt consolidation NON-QM mortgage, you will pay your creditors directly with the loan, and can receive a maximum of $2,000 cash in hand after closing
• This is a great opportunity to get back on your feet
• Below is a grid of credit scores and maximum loan-to-value is allowed for NON-QM lending

Credit Scores Versus Maximum LTV Cash-Out Limit

Borrowers credit scores dictates on the maximum loan to value allowed on non-qm cash-out refinance financing.

Here is the credit scores versus Debt Consolidation Versus Traditional NON-QM Cash-Out LTV Limits:

• CREDIT SCORES 500-579
  • Cash-Out Refinance 70%
  • Debt Consolidation Refinance 75%
• CREDIT SCORES 580-599
  • Cash-Out Refinance 80% LTV
  • Debt Consolidation Refinance 80 LTV
• CREDIT SCORES 600-679
  • Cash-Out Refinance 80%
  • Debt Consolidation Refinance 85%
• CREDIT SCORES 680 AND HIGHER
  • Cash-Out Refinance 85% LTV
  • Debt Consolidation Refinance 90% LTV

Case Scenario Where NON-QM Cash-Out Debt Consolidation Refinance Benefits Homeowners

Example:

Daniel has a home in Riverside California worth $450,000. Current credit score of 611 due to a few late payments on his mortgage and vehicle. He is not married and has the debts below:

Mortgage –

• $274,000

2nd Mortgage (HELOC) –

• $54,400
• Auto Loan –
  • $17,500
• Credit Card 1 –
  • $11,700
• Credit Card 2 –
  • $10,300
• Personal Loan –
  • $7,500

Total Debt – $375,400

Daniel was able to combine all of his Consumer Debt into one easy to make monthly payment.

• At the end of this debt consolidation refinance, Daniel was saving over $700 a month
• Can you imagine what you would do with $700 a month?
• Especially while struggling
• These loans can be life changing
• He would NOT be able to do this loan with a conventional or FHA loan due to his late payments
• This loan allows Daniel to hit the reset button and get a second chance!

NON-QM Lending Guidelines

NON-QM Loans are becoming increasing more and more popular.

• Home Buyers do not have mandatory waiting period after bankruptcy and/or housing event like government and/or conventional loans
• There is no maximum loan limit
• There is no private mortgage insurance required
• Gustan Cho Associates at Loan Cabin Inc. has 95% LTV NON-QM Jumbo Mortgages with no mortgage insurance
• We offer bank statement loans for self employed borrowers with no private mortgage insurance and no tax returns required
• Loan Limits can be up to $3 million and maybe higher depending on circumstances

NON-QM Mortgages are NOT for borrowers with bad credit. Many borrowers with great credit can benefit with our non-qm loan programs.

Non-Borrowing Spouses Debt Does Not Count In Community Property States

Another great feature of NON-QM loan is, NON-QM loans are “conventional” in a sense that community property states rules are not applied:

• They also do not have to follow conforming or FHA loan limits
• There are maximum loan limitations typically $1,000,000 to $3,000,000 depending on credit score

If you have done a cash out loan in the past, you will understand 90% loan-to-value is out of this world!

• It really opens up the opportunity to get you out of the hole that you’re in
• If you feel like a NON-QM mortgage loan might fit the needs of yourself or your family, please reach out to us directly
• Contact Mike Gracz on 630-659-7644 or shoot an email to mgracz@gustancho.com
• We are experts on the ins and outs of NON-QM Mortgage lending
• There are very few situations we have not come across in the past, we are always here to help
• If for any reason you do not qualify today, or you are not happy with the terms you qualify for, we will put you on a financial plan to qualify for the right mortgage as soon as possible

Consolidating your Consumer Debt into tax deductible mortgage interest has many benefits. We are available seven days a week to go over your scenario!