Non-QM Loans: A Solution for Prospective Homebuyers

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If you have difficulty qualifying for a  conventional mortgage loan, you are not alone. QM guidelines have prevented about 20 percent of prospective homebuyers from entering the market, simply because they do not qualify under these new standards. As a result, these borrowers must consider non-QM loans.

Prior to the financial crisis, high-income borrowers and the self-employed had a multitude of options for attaining a mortgage loan. These options included interest-only loans, as well as loans with minimal documentation. The QM regulatory reforms have eliminated these types of loans; they are no longer offered by banks and conventional lenders.

Non-QM lenders have emerged to cater to the many borrowers who cannot get a QM loan. Non-QM loans are not necessarily high risk. Working with a reputable lender like Athas Capital Group provides a structured and transparent lending program that meets your needs. Non-QM loans often have strong credit attributes, such as borrowers with sizeable income and high credit scores.

The concern surrounding non-QM loans pertains to poor-credit and low-income borrowers. This demographic was targeted by predatory lenders, and this largely contributed to the financial crisis, as many of these borrowers had to default on their loans. No matter your income or credit score, it’s important to choose your non-QM lender wisely. Only work with a non-QM lender that has a positive reputation and demonstrates honesty and integrity.

 

 

 

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Applying for a Subprime Loan

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A subprime loan is designed for borrowers who do not qualify for a conventional prime loan. If you can’t qualify for a prime mortgage due to insufficient credit, little or no down payment, or the inability to prove your income, then you may be eligible for a subprime loan. To apply for a subprime loan, follow these steps:

Research subprime lenders

Subprime loans are most commonly offered by private lenders. Research credible subprime lenders and contact them about their lending programs, rates and fees. Athas Capital Group, for instance, is one of the leading subprime lenders in the country, prized for its transparent programs, quick closings, and reliable service.

Gather your financial documents  

Collect and make copies of the financial documents a lender will need to verify your income, employment status, and creditworthiness, including your most recent paychecks, federal income tax return, bank account statements, and credit card bills. To get a more favorable interest rate, you want to show that you are capable of making payments in a timely fashion. Therefore, you’ll want to include other regular bills with on-time payments, such as a car or student loan statement.  Once you’ve gathered the necessary documentation, submit the copies to the lender.

Submit a loan application

Complete the lender’s loan application, and give the lender permission to pull your credit.

Review the loan terms

If the lender approves your application, review the loan terms offered to you, including the interest rate and repayment period. Make sure you are comfortable with the terms before signing. Keep in mind that interest rates are higher for subprime loans than prime loans due to the higher risks involved.

 

 

 

Many Americans Can’t Get a Traditional Mortgage

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Owning a home is the American dream, but that dream is unattainable for a lot of Americans. Mortgage lending guidelines continue to tighten, making homeownership far from a reality for many.

A recent report released by the Federal Reserve Bank of New York showed that the total volume of new mortgages declined by $39 billion in the second quarter of 2016, compared to a year earlier. Additionally, the median credit score was a high 756, which is well above the average score of 695. This means the average American is unable to qualify for a traditional mortgage, even eight years after the financial crisis.

While prices in several markets have returned to their pre-crisis peaks, this consistent tightening is a key reason why the U.S. housing market is hasn’t recovered. The lending restrictions of conventional banks and credit unions make mortgages only available to the most qualified Americans.

Fortunately, subprime lending offers a solution to this problem. While some subprime lenders have earned a bad reputation due to their contributions to the housing crisis, subprime loans aren’t all bad. Working with a reputable lender like Athas Capital Group eliminates the barriers to homeownership through structured and transparent lending programs, backed by in-house capital. Athas is one of the leading alternative lenders in the country, prized for its outstanding service and transparency. Visit www.athascapital.com to learn more.

 

Athas Capital Group: The Nation’s Leading Nonprime Mortgage Lender

Athas Capital Group emerged in 2008 as one of the nation’s first non-prime mortgage lenders. With bank’s increasingly tight lending restrictions, it can be very difficult for many borrowers to get a loan. Athas Capital Group was founded to provide a solution to this problem. Nearly 10 years after its founding, Athas continues to provide realtors, mortgage brokers, investors and consumers with the subprime and hard money financing solutions they need. With its transparent products, competitive pricing, and superior service, Athas remains among the leading direct nonprime bridge lenders in the United States.

The founders and principals of Athas Capital Group have approximately 50 years of collective experience in the real estate industry and have tailored its innovative financing programs to meet the needs and demands of the market. A genuine direct lending platform, Athas provides its clients with transparent lending programs, defined and concise financing parameters, and institutional funding capacity. At Athas, all funding, underwriting, and decision-making is done in-house.

Visit www.athascapital.com to learn more about Athas Capital Group and its lending programs.