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Nonprime Wholesaler Expands

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A wholesale lender that funds short-term hard-money mortgages is moving into longer-term nonprime financing.

Athas Capital Group Inc. says it has already been funding bridge loans for hard-money borrowers.

But the Calabasas, Calif.-based company says that nonprime or “soft-money” borrowers are underserved in today’s market.

“If a borrower fails to meet the onerous underwriting guidelines of banks and GSE lenders, they are not provided with a middle ground solution and their only alternative is bridge/hard money financing,” the statement said.

So the company is targeting the underserved segment.

An announcement Tuesday indicted that it will expand its offerings to include longer-term loans with lower interest rates.

“We are going to fundamentally change the current lending landscape,” Athas Chief Executive Officer Brian O’Shaughnessy proclaimed in the announcement.

In a separate statement to MortgageDaily.com, O’Shaughnessy said that the company funds commercial and residential properties, though residential is only available in Arizona and California.

He explained that loan-to-value ratios are capped at 65 percent on purchase transactions and 60 percent on refinances — though 70 percent LTV is available on “fix and flip” residential transactions in California.

O’Shaughnessy said that more than 95 percent of the lender’s originations are originated by mortgage brokers.

The company’s rate sheet is reportedly comparable to subprime product sheets used between 1989 and 2007. The matrices are based on credit tiers, loan-to-value tiers and prepayment options. Also included are pricing add ons and deductions.

“Our residential and commercial product matrices are highly structured and defined,” O’Shaughnessy claims. “There are no hidden fees and everything is transparent.”

A pricing campaign in place over the past few months has Athas meeting or beating “any of our competitors’ pricing on loans that fit our product offerings.”

“Athas will put more points in our brokers’ pockets than any other private lender,” O’Shaughnessy stated.

Athas obtains funding for the mortgages from The Rama Fund LLC, which is managed by O’Shaughnessy and Athas President Alim Kassam.

While O’Shaughnessy declined to quantify the size of the company’s war chest, he did note, “We have no liquidity restraints. The model of our mortgage fund allows for continual deployment of our funds pursuant to our product metrics.”

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