Non-QM Product Launches

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A new program has been launched that provides home financing for borrowers who don’t necessarily meet the requirements for a Qualified Mortgage.

The Home Buyer Power product has been introduced by New Penn Financial LLC, a news release Tuesday said.

The new offering is designed to help finance borrowers who are unable to meet the Consumer Financial Protection Bureau’s QM requirements.

Debt-to-income ratios on the program can go as high as 55 percent on transactions where the loan-to-value ratio doesn’t exceed 80 percent.

Also featured are interest-only payments.

In addition to primary residences, second homes and warrantable and non-warrantable condominiums are eligible properties.

“We expect Home Buyer Power to appeal to high-end customers who may be paying expensive metro-area rents,” New Penn’s Brian Simon said in the announcement. “They have the income to support a home purchase, but they may also have higher than average debt obligations.”

The Plymouth Meeting, Pa.-based firm claims to be one of the first non-bank lenders to enter the non-QM market.

Impac Mortgage Holdings Inc. developed an Alt-QM program that allows DTI ratios up to 50 percent, multiple loans to investors and difficult-to-document self-employed borrowers.

New Penn said that its program is not a free for all.

“While the non-QM loans broaden the pool of customers eligible for a mortgage, the designation doesn’t mean that borrowers are unvetted or under-qualified,” today’s statement said. “Buyers will need to provide full income documentation, demonstrate strong credit scores, and meet additional guidelines that indicate their ability to repay.”

A New Penn spokesman said that the program will initially be made available to mortgage brokers through its wholesale channel.

The product is expected to rolled out through other channels shortly.

More non-QM products are anticipated by New Penn.

Mortgage Expert

Mortgage Daily Staff



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