Lending Philosophy Borrowers Win!
A “common sense” approach to underwriting, focusing on the property that you own, rather than on what you "owe". We have flexibility conventional financing like your traditional bank does not. We loan to borrowers with higher risks of default, unverified sources of income, high debt ratios, or simply borrowers needing cash out quickly. We understand your financing needs are not just numbers on a page, but rather a situation that needs attention and most importantly a solution. We are here to find you a creative financing solution that can help you get financing when you need. We finance borrowers with A through F credit and will not deny you based exclusively on credit score, self-employment, foreclosure, bankruptcy, payment history, title held by corporation or trust, property currently listed, lack of paperwork, etc.
Our criteria is simple…
· You are looking for Residential, Multi-Family, Commercial, Construction, Land Financing
· You have an asset to collateralize or assets to cross-collateralize
· Your asset(s) value have at least 20-30% equity
· You can show ability to repay the loan stated no doc
"MAKE-SENSE" Underwriting Approach
When underwriting "equity-based" loans, we focus on the following:
1) In the event of default where the borrower will not be able to pay, what is the chance of loss of money? To answer this question we look at the following criteria…
a. How true is the current appraisal? Is the subject property compared to similar properties close in size, location, amenities, etc. or are you left questioning what the real value is? Is the property at the low or high end of the average neighborhood value range: If the property had to sell today what would it sell for?
b. What condition is the property in- pride of ownership, move-in, tear down, remodeled, etc.? How much would it require prepare the property for resale?
c. How long will it take to sell the property based on marketability, location, amenities, absorption rate and/or other factors?
d. What is the equity amount or the loan to value in the property currently?
2) What is the chance that the borrower will default? To answer this question we look at the borrower’s willingness to pay based on past or present history, borrower’s ability to pay based on stated income no tax return no verification programs and stability or resulting profits or non doc.
a. Credit History - Reasons for any derogatory credit situation and have those credit problems or issues been resolved. We need to understand the cause of the prior credit concerns to understand the affect of a new loan. We will allow letter of explanations instead of credit. You will never be denied because of credit score alone. No fico ok.
b. Income/Debt Ratio – We look at if the borrower’s stated income ability to pay, how long the borrower has been receiving this income and what the relationship is of such income level to his/her current and future debts. This helps borrowers because for example, our loan may create substantial monthly savings for the borrower. In this case, we can allow for a higher debt ratio than conventional lenders can.
c. Loan Common Sense- Does the loan make sense? Does the loan benefit (save money, cash out or prevent default situation) or hurt the borrower?
d. Higher Payments - If an applicant has not been able to make their present mortgage payments and a new loan would result in higher monthly obligations then we need to justify the ability to repay the higher loan. For example, borrowers are self-employed with a slow business but expect to be filling new orders shortly or borrowers experienced some emergencies that constrained their finances temporarily. Sometimes these financial challenges are temporary and a new loan would allow the borrower to get back on their feet. However the borrower does need to show an exit strategy.
With flexibility like this - call us at (888) 297-4440 today for a quick quote!
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