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Wholesalers Tout Subprime, Hard Money & YSPs

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Wholesale lenders are offering programs that include 80 percent loan-to-value with stated income, refinances for borrowers in foreclosure or Chapter 13 bankruptcy, and rebates up to 3 percent. Other subprime and hard money products are also being marketed. One wholesaler is training mortgage brokers how to originate commercial loans.

In e-mails to mortgage brokers, Accredited Home Lenders is promoting 80 percent loan-to-value for borrowers with 30-day mortgage lates and for self-employed borrowers with stated-income. In addition, 80 percent LTV is available to buyout fully documented borrowers in Chapter 13 Bankruptcy if two years have elapsed since the filing.

The San Diego-based company, which said its full documentation loans go up to 90 percent LTV, also touts debt ratios up to 60 percent in some situations while it says “collections, charge offs, judgments not on title are ignored.” FICO scores are allowed down to 525 on full documentation loans and down to 600 for stated-income self employed borrowers. On borrowers with 90-day mortgage lates, Accredited says it will do up to 60 percent LTV.

It noted loan terms up to 40 years and maximum loan amounts up to $750,000, though “if it makes sense we can make exceptions.” The company promises approvals and appraisal reviews within 24 hours and closed loans within five days.

Charter Bank Specialty Lending Group also used e-mail communications to market subprime and hard money programs to mortgage brokers.

“Our typical borrower is either in Chapter 13, is facing foreclosure or has recently had a foreclosure,” Charter states on its Web site. “We have designed our products to permit borrowers who have equity in their property to be able to get out of bankruptcy, save a home from foreclosure, purchase a home having just faced foreclosure, or refinance their existing mortgage to clean up their credit.”

Charter said it recently closed a transaction where the borrower put 5 percent down and had a 498 credit score. A seller second enabled the 50 percent LTV first mortgage.

In its own e-mail messages to mortgage brokers, Wachovia Bank said it offers 80 percent LTV on “pick a payment” stated-income loans with FICO scores down to 620 and loans up to $750,000 for cashout or rate and term refinances. The program allows loans up to $1.5 million on rate and term refinances with 650 FICO scores up to 80 percent LTV.

Wachovia said yield spread premiums go as high as three points, to a maximum of $40,000.

American Home Bank, which offers third party originations through community banks, recently announced that seniors can finance the purchase of a newly-constructed home using a reverse mortgage.

“In a purchase transaction, a reverse mortgage could be used to limit the amount of cash a purchaser would need to buy a home without being burdened by debt service,” the announcement said. “Since reverse mortgages do not require repayment as long as the homeowners occupy the property, the ‘reverse for purchase’ option allows buyers to finance the new home without also taking on future monthly loan payments.”

Mercantile Commercial Capital announced it is hosting conferences to train residential mortgage brokers how to transition into commercial lending under the Small Business Administration’s 504 program.

Among recent deals Mercantile said new correspondents have closed are a $1 million loan for an Orlando, Fla., office condo; an $0.5 million loan for a Wisconsin office-warehouse; and an $0.4 million loan for a Tampa, Fla., assisted living facility.

SunTrust Mortgage Inc.’s wholesale division was recognized for improving customer satisfaction by the National Business Research Institute, according to an announcement Thursday. The award was based on a benchmarking database score in conjunction with improvement from the last score.

“The SunTrust Mortgage wholesale division began the best practice of continuous improvement with their first customer survey in early 2007, Dr. Jan Stringer, organizational psychologist at the institute, said in the announcement. “As a result of customer survey research combined with targeted action, the SunTrust Mortgage wholesale division has realized great gains in customer satisfaction, which has sustained their impressive growth.”

MortgageIT recently announced a reorganization of its wholesale branch structure, a move it said will allow it to “weather this turbulent market.” More information about the new process and procedures were expected to be released over the next few weeks.

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