Non-Prime loans come in many forms. These loan types are in a classification that evolved from the SubPrime days which contributed to the real estate and mortgage crisis in 2007. They do not fall in the same category of standards which are regulated in government backed loans from FHA, VA, FNMA, and FHLMC. Non-Prime loans are not A-Paper as defined as Qualified Mortgages and have sub standard credit and income leniency guidelines.
Non-Prime loans typically are made to borrowers who have recent negative credit which impacted financial events such as Foreclosure, Bankruptcy, Short Sale, Collections, and Charge-Offs. The positive side for borrowers with these circumstances seeking a Non-Prime loan can use alternative documentation to qualify. Depending on the lender, borrowers can supply bank statements, liquid assets, and other non-typical forms of income to satisfy an underwriters requirement, unlike supplying verifiable tax returns, pay-stubs and W-2's for typical conforming loans. Non-Prime loans are associated with higher rates and fees. Investors approving these loans experience higher risks associated with funding and servicing them, therefore the higher costs and fees are substantiated. Non-Prime loans are typically short term loans and should be treated as a temporary financial solution and not permanent financing.
American Nationwide Mortgage Company is a direct lender and funds our own mortgages nationwide. We do understand borrowers have financial and credit hardships in life and we want to help you achieve your mortgage needs. We have customers who need these Non-Prime loans as a result we broker these types of loans to the appropriate investor. Contact one of our Non-Prime Specialists to discuss your options today and plan for permanent financing.