Residential Lending

Conventional loans are the most common type of lending for home buyers. Rates and terms depend on perceived risk to the lender. 

Loan options include

• Interest rate structure: Fixed, fixed-to-floating, or floating 
• Interest rate percentage: Risk dependent 
• Loan length: Short, intermediate, or long-term amortization 
• Payment schedule: Monthly, quarterly, semi-annually, or annually

Financial and mortgage expertise is required to structure and attain the desired conventional loan. Additionally, each institution may have its own preferences and risk factors.    

Home owners use a broker to get the financing they need without the extra hassle.  

A Federal Housing Administration (FHA) loan is a federally insured mortgage supplied by an FHA-approved lender. The guarantee is paid via a mortgage insurance premium payment to the FHA. The lender is at less risk because the FHA will pay a claim to the lender if the borrower defaults.

FHA loans offer a low minimum down payment with less closing costs. These loans make it easier for low-to-moderate income borrowers with below average credit scores to get a mortgage.

Non-Qualified Mortgage (Non-QM) loans are for borrowers with unique financial circumstances. Many people have irregular incomes, lump sum incomes or are self-employed. Non-QM loans fill the void left by CFPB and Federal Government rules. A Non-QM loan uses alternate methods of income verification to get approved for a mortgage loan. Verification methods include business and personal documentation—tax returns, P&L statements, bank statements, and account history. 

Irene Partners' financial expertise and creativity make affordable Non-QM loans a reality. 

A Veteran’s Affairs (VA) loan is a federally insured mortgage supplied by a VA-approved lender. There are low interest rates because a federally backed loan carries low risk to the lender. With a VA Loan, borrowers can finance the home's value without a down payment. Veterans can borrow as much as they want but there is a limit on the what the VA will guarantee. There is no requirement for private mortgage insurance (PMI) because the federal government assumes the risk that is covered by PMI. 

VA loans may only be used for a primary residence. 

A home equity line of credit (HELOC) is a revolving source of funds that the borrower can access at will, like a credit card. Like any form of credit, it comes with a pre-approved credit ceiling. The amount the borrower can access depends on the equity taken from the home. Funds may be accessed via online transfer, writing a check, or using a credit card connected to the account. HELOCs have minimal closing costs and variable interest rates – though some lenders offer fixed rates for a certain number of years. 

Home equity lines have a draw period and repayment period. During the draw period, the borrower can access available credit as they see fit. This is typically over a 10-year period. Payments during this time are interest only, sometimes with the option to pay extra toward principal. 

The repayment period begins as the draw period ends. During this time, no additional funds can be accessed, and the borrower pays principal AND interest (fixed or variable) until the balance is gone. Repayment is typically a 20-year period. 

A jumbo loan, also known as a jumbo mortgage, is financing for luxury properties and homes in highly competitive local real estate markets. The cash amount exceeds the limits set by the Federal Housing Finance Agency (FHFA). Jumbo loans are not eligible to be purchased, guaranteed, or securitized by Fannie Mae or Freddie Mac and therefore come with unique underwriting requirements and tax implications. The value of a jumbo loan varies by location, but the minimum is typically between $450,000 and $750,000. 

Borrowers applying for a jumbo mortgage are subject to rigorous credit requirements. There is a high risk associated with jumbo loans due to the size and structure of the mortgage. Borrowers need a near-perfect credit score and a low debt to income ratio to qualify. Also, borrowers must prove they have liquid cash for high payments and offer proof of ownership for any non-liquid assets. 

Contact Irene Partners now for a free financial analysis to discover whether you qualify for a jumbo loan.