NMP National Mortgage Professional - December 2020

SPONSORED EDITORIAL

Non-QM Lending, Vital to Industry Growth

If the past decade has taught us anything as an industry, it is that the business of mortgage lending is highly adaptable and resilient. Through market changes, a financial crisis, regulatory overhauls, and a global pandemic, we continue to adjust and respond, and of course continue to provide secure and reliable home financing options.

As we look forward to 2021, Non-QM lending represents a great opportunity for both mortgage professionals and their consumers. Many viable transactions no longer fit the conforming mold. More borrowers are self-employed, earning non-traditional income, or investing in real estate. Non-QM products, such as the suite of Simple Access® programs from Luxury Mortgage Corp.®, provide solutions for these once tough to handle scenarios.

Based on recent advances in the Non-QM niche, lenders and originators can capitalize on unique opprtunitiesto drive this segment of their businesses forward in the first quarter of the new year and beyond.

Improved Guideline Flexibility

Expanded guidelines and a commonsense underwriting approach have broadened the scope of Non-QM lending. It is now a viable option in a wide variety of scenarios. Some of the enhancements recently applied to the Simple Access® products include:

• Loans Amounts to $3M

• Credit Scores down to 640

• DSCR option with No DTI

• LTV to 80%

• Recent credit events allowed

• Cash Out up to $500K

This opens financing opportunities to many more borrowers, including those without perfect credit or in need of large loan amounts. As a result, this means increased opportunity for growth within the industry.

Return of Lender Paid Compensation

Now that Lender Paid Compensation is once again a viable option, you have greater flexibility in delivering user friendly solutions to a wider swath of eligible borrowers. As mortgage professionals work hard to find flexible solutions for sometimes complex scenarios, they can now see more significant financial compensation while providing lower rate options to their clients.

Expanded Product Offerings

A key opportunity of Non-QM lending is that there is no “one program fits all” approach. We see this built upon further with the release of additional product options. Some of the specialty programs available within Simple Access® include:

• Investor Cash Flow Qualification based on income generated by the subject property.

• Bank Statement Qualification based on business or personal bank statements.

• Asset Qualifier Eligibility based on a borrower’s liquid assets

• Full Doc Excellent pricing for scenarios just outside conventional guidelines.

• 1099 Only Great option for self-employed, independent contractor, or commission only professionals.

We anticipate this product expansion will further fuel continued growth of Non-QM lending, leading to increased production for mortgage lenders who embrace the niche. “Luxury Mortgage is committed to being the leader in Non-QM lending options for our brokers and correspondent sellers.” Says Mr. Lawrence Winters, Luxury Mortgage’s Product Development Committee Chair

About the Author Brett Mosello is the Vice President of Sales and Marketing at Luxury Mortgage Corp. With over three decades of experience in the mortgage and finance industries, he is focused on balancing sustained growth without sacrificing client experience. Mr. Mosello splits his time between Stamford, CT, home to Luxury Mortgage Corp.’s headquarters and Irvine, CA the firm’s wholesale operations center.