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Loan programs: Portfolio (Non-qm)

Over the last few years,many hard working people who lost their homes or were forced into bankruptcy due to a layoff or reduced income have since rebuilt their credit and are able to demonstrate their ability to repay. For these borrowers who may be unable to obtain mortgage financing due to seasoning or other requirements, Fresh Start may be the lending solutions they have been looking for.

Loan Features:

  • No seasoning requirements for bankruptcy, foreclosure, deed-in-lieu of foreclosure or short sale
  • No mortgage or rental pay history required
  • Minimum credit score 580
  • Debt ratio up to 50%
  • Loan to value up to 80%
  • Loan amounts to $2,000,000
  • Non-warrantable condos
  • No pre-payment penalty

A Warrantable condo simply means that the condominium project is eligible and the loan can be sold to Fannie Mae or Freddie Mac. A Non-warrantable condo is not eligible to be sold to Fannie Mae or Freddie Mac. Therefore most mortgage lenders will not lend on a non-warrantable condo. However, many portfolio lenders have recognized the need for these types of transactions and have designed products specifically for them.  The issues that could cause a condo to become non-warrantable are: projects involved in a litigation, too many HOA dues that are late, too many non-owner occupied units, too many units (as a percentage) owned by one individual/entity, and more. 

Non-warrantable condo

Fresh Start 

Bank Statement Only

A portfolio loan is a loan that is serviced by the lender that issued the money. Which means they can create programs that fit their guidelines for a clientele base.  Here are the basics of portfolio loans and how they work . Check them out and see if one might work for your situation.

Bank statement only loans are especially meant for Self Employed borrowers. Where this differs from a Conventional Loan is that the lender does not use the net income from the tax returns but the gross deposits from business or personal bank statements. The obvious client for this program is someone who has many deductions on their taxes that results in lower take home (net) income. But, even people who have part-time Self Employed income can use this program

Asset depletion

An Asset Depletion loan may sound risky because of its name....but quite the contrary.  Asset Depletion doesn't mean you "deplete" your assets, but instead, the lender uses a formula (that changes from lender to lender) to calculate a monthly income. This income is added to your other income to be used to calculate your debt ratio. As rare as this way of calculating may sound, it is even used with your standard Conventional Loans (Fannie and Freddie) when needed. Fannie and Freddie's formula is 70% of qualified assets divided by 360. But, many portfolio lenders offer more aggressive calculations.