Non-Prime Loans are gaining more market share every year as far as percentage of loans closed
Our Non-Prime Loan today is Looking more and more like the the old sub-prime that we all are trying to forget about
Here is the latest on what is available nowadays
Today’s Non-prime loans are geared towards investors who are purchasing multi-unit properties and renting them out. Many are using the properties to try to manage air B N B situations. The DSCR loan will qualify investors on 1-8 unit properties even if the property doesn’t appear to cash flow. The appraisal will use rents that are yearly in most cases.
Other programs are great for entrepreneurs but make sure you have assets, a good credit score and at least 2 years of self-employed-ness in this line of work.
The Old Story
I started my mortgage career back in about 1991 working as a processor at SunTrust bank. It was the perfect training ground for getting into an understanding of what was needed for someone to get a mortgage. I met some really excellent people there.
Later on in my career I was working for a sub-prime lender in 1998. I met some really excellent people there as well but unfortunately in October of 1998 there was a sub-prime meltdown on Wall Street that caused about 10-12 major players, (sub-prime lenders) to go under. The company I was working for was one of them. The company went under but the good part was that I kept in contact with the group that was part of it and we remained in contact going forward in life.
Flash forward to 2009-2010 more sub-prime problems because loans were way too aggressive being bundled with other loans that were supposed to be vanilla Fannie-Mae that don’t have problems.
Today’s Non-Prime is geared towards customers who are aggressive with there taxes and have a lot of assets, Investors or Foreign Nationals.
The bank statement loans require a minimum of 12 months bank statements on a corporation or LLC that has been in existence at least two years.
The DSCR loan is great for investors who do not approve Fannie Mae. The rates are higher with these loans but you still get the property if you have the assets.
The Bank Statement Loan is good for self employed customers who write off a lot of expenses.
You will need good credit scores and at least 10% down.