NON-QM Loans And Guidelines On Purchase And Refinance Transactions
This ARTICLE On 2020 NON-QM Loans And Guidelines On Purchase And Refinance Transactions Was PUBLISHED On January 7th, 2020
Gustan Cho Associates are very optimistic about 2020.
- There have already been some exciting announcements in the mortgage industry
- We expect 2020 to be busy especially when it comes to NON-QM mortgage lending
- Since all of the major lending agencies such as FREDDIE MAC, FANNIE MAE, USDA, FHA, and VA are currently overseen by the federal government, guideline requirements have become strict
- This can affect your ability to qualify for a mortgage
- If you have had trouble in the past with derogatory credit issues such as a foreclosure, you may want to look into a NON-QM mortgage loan
- In this blog, we will detail what a NON-QM mortgage loan means, some of the new loan products for 2020, and how to apply for a NON-QM mortgage with Gustan Cho Associates
In this article, we will cover and discuss the 2020 NON-QM Loans And Guidelines On Purchase And Refinance Transactions.
NON-QM Loans And Guidelines Versus Qualified Mortgages
A NON-QM mortgage loan stands for a non-qualified mortgage. A QM MORTGAGE is overseen by the major agencies.
- For example, FHA, conventional, USDA, and VA mortgage are considered qualified mortgages
- These have very cut and dry mortgage guidelines that must be met
- Some of these mortgage guidelines have 7-year time requirements before being able to apply for a qualified mortgage
- Now that you understand what a qualified mortgage is, a NON-QM mortgage is simply outside of that realm
- Yes, a NON-QM mortgage does have its own set of guidelines, but they are much more lenient
- Especially when it comes to derogatory credit events such as a foreclosure, deed-in-lieu, or short sale
- You can be one day out of foreclosure and still qualify for a NON-QM mortgage
- NON-QM mortgage loans are nothing new, they’ve been around for years
- Thousands of Americans have already utilized them to purchase or refinance their properties
This a great tool to build equity and not make a landlord rich.
UPDATED Non-QM Loans And Guidelines And New Products
New NON-QM loan products for 2020.
- 85% LTV cash-out refinances; In 2019, both FHA and VA lowered their maximum loan-to-value (LTV) requirements for cash-out refinance mortgage loans
- Now only a veteran can use a qualified mortgage to get more than 80% loan-to-value out of their property during a cash-out refinance
- So, if you are not a veteran, even with an FHA loan, you are limited to 80% loan-to-value
- That’s where this NON-QM mortgage loan can really help. NON-QM still allows 85% loan-to-value cash-out refinance mortgage transactions
- This extra 5% can help you pay off debt, help pay for your kids’ college, complete home repairs, and even fund investment opportunities
While the loan-to-value requirements are put in place to protect your house from equity stripping, these refinance transactions can put thousands of Americans in a better overall financial situation.
Unique And Alternative Non-QM Mortgages
Platinum NON-QM products. In the last few months of 2019, a few of our NON-QM investors have started introducing PLATINUM NON-QM mortgage products. The rates aim to be closer to conventional mortgage rates for high credit score borrowers who may not qualify for a conventional mortgage
Besides competitive interest rates, these loans allow a large number of Americans to enter mortgage financing where they may not be able to with Fannie Mae or Freddie Mac guidelines.
- Up to 90% LTV with 680 Credit Score
- Max Cash out up to $1 Million
- 12 or 24 Months Bank Statements can be used for income
- 1-year documentation program available (W2 or tax return)
- ARM, FIXED, or Interest Only Options available
- Cash-out funds can be used for reserves
- Credit/Life event seasoning 4 yrs
- short sale, foreclosure, deed-in-lieu, loan modification, and 120-day mortgage lates
- Jumbo loan amounts up to $ 2.5 M
- DTI Up to 50%
Non-QM Loans Where No Income Tax Returns Are Required
We still have all of our other than NON-QM mortgage products available.
- Everything from bank statement loans, one-year tax return loans, investment property loans, Fix and Flip mortgages, and more
- We have a Full Slate of NON-QM loan products that most lenders do not offer
- If you are having trouble qualifying for a mortgage, please give us a call
We would love to help you with your NON-QM mortgage needs.
Pre-Payment Penalty On Non-QM Loans
A frequently asked question about NON-QM mortgage loans; Is there a prepayment penalty? If the NON-QM mortgage loan is on a primary residence, there is no prepayment penalty. Depending on the loan product, there can be prepayment penalties for investment properties or second homes for a NON-QM mortgage. Usually no longer than two to three years. This is an important question to ask. Many borrowers are only in a NON-QM mortgage loan for six months to a year. Gustan Cho Associates complete numerous NON-QM mortgage loans and help refinance our clients out of them as soon as possible. Please call Mike Gracz on 630-659-7644 to discuss refinance options down the road.
Gustan Cho Associates are specialists in NON-QM mortgage lending. We are also specialists in FHA, VA, and conventional mortgage lending. 75% of our clients have either been denied by their current lender or not getting the customer service they expect. If you have any mortgage questions, please contact Mike Gracz on 630-659-7644.