Gustan Cho The Mortgage Expert,
Publish On: February 14, 2022
In this blog, we will discuss and cover the recent late payments mortgage guidelines with non-QM loans. Mortgage borrowers can qualify for traditional government and conventional loans with prior bad credit. Outstanding collections and charge-off accounts do not have to be paid off to qualify for government and conventional loans. Home buyers can qualify for mortgages after bankruptcy after meeting the mandatory waiting period requirements.
Recent Late Payments Mortgage Guidelines: Qualifying For A Mortgage With Bad Credit
Repossessions and high-balance charge off accounts do not have to be paid to qualify for home mortgages. However, recent late payments mortgage guidelines state that borrowers need timely payments in the past 12 months to qualify for government and conventional loans in order to get an approve/eligible per automated underwriting system (AUS). Now, borrowers with recent late payments in the past 12 months can qualify for non-QM loans. In this article, we will discuss recent late payments Mortgage Guidelines with non-QM loans.
Recent Late Payments Mortgage Guidelines: What Are Non-QM Mortgages
Non-QM Mortgages are portfolio loans that do not conform to government agency nor conventional lending guidelines. There are no waiting period requirements after bankruptcy, foreclosure, deed in lieu of foreclosure, short-sale with non-QM loans.
Benefits of Non-QM Loans
Benefits of non-QM loans are there are no maximum loan limits. Borrowers with lower credit scores can qualify for Non-QM Jumbo Loans with credit scores down to 500 FICO. There is no private mortgage insurance required on non-QM home mortgages. Non-QM Loans are for both primary, second homes, and investment homes.
Bank Statement Loans For Self-Employed Borrowers
Self-employed borrowers with little or no income declared on their income tax returns can qualify for bank statement loans for self-employed borrowers. 12 months bank statements are averaged to calculate monthly income. Non-QM Mortgages are not only for borrowers with bad credit. Many higher income/credit borrowers take advantage of non-QM loans such as bank statement loans for self-employed borrowers. Down payment requirements on non-QM Loans are 10% to 20% down. The amount of down payment depends on the borrower’s credit scores, type of property, and longevity of bankruptcy and/or housing event.
Mortgage Rates on Non-QM Loans
Non-QM Mortgage Rates are higher than traditional government and conforming loans. Non-QM Mortgage Rates depends, on the borrowers’ credit scores, the down payment, the type of property, and the longevity after bankruptcy and/or housing event. Non-QM Loans are becoming increasingly popular among home buyers.
Recent Late Payments Mortgage Guidelines Case Scenario
Let’s take a case scenario.
- Let’s say John Smith recently sold his home and made a substantial profit due to the equity he had on this home
- His mortgage loan balance is now paid off and has no mortgage
- However, he had multiple late payments on his mortgage in the past 12 months
- John Smith will have a hard time to qualify for a new mortgage on his next home purchase due to the late payments in the past 12 months on his previous mortgage
- This still holds true even though he sold his home and has his previous mortgage payment paid off
- Recent Late Payments Mortgage Guidelines on government and conventional loans require timely payments in the past 12 months to get an approve/eligible per automated underwriting system (AUS)
- One or two late payments in the past 12 months is not always a deal killer
- However, multiple late payments in the past 12 months will be an issue in getting an approve/eligible per AUS
- The good news is that John Smith can qualify for non-QM Loans with late payments in the past 12 months
- 10% to 20% down payment will be required
Non-QM mortgage rates are higher than government and/or conventional loans. After a year, John Smith can refinance the non-QM Mortgage to a traditional government and/or conventional loan.
Recent Late Payments Mortgage Guidelines: Qualify and Get Pre-Approved Today on Non-QM Loans
Borrowers who have more questions on this blog or other mortgage topics, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at alex@gustancho.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.
