Colorado Alternative Mortgage Solutions
Alternative mortgage solutions are "Type Four" and "Type Five" mortgage solutions. That is, mortgage solutions for borrowers that have unique needs with either great or not so great credit. It is important to understand that there is probably a mortgage solution for you, regardless of your credit profile. The questions become, what loan to values are available, what are the rules for documenting income, and are the costs associated with the mortgage acceptable? Your mortgage consultant should help you understand the answers to these questions for the mortgage solutions that are available to you.
Examples of unique needs include:
Self-employed borrowers: Self-employed people often have difficulty proving income using the standard guidelines (taking income from tax returns) due to substantial tax deductions. Alternative solutions for borrowers who are self-employed extend from conventional mortgages (taking advantage of automated underwriting solutions) to stated income mortgages, to no income no asset mortgages, to no doc mortgage solutions. These solutions represent a range of solutions from limited documentation of income, to stating an income with no proof, to not stating an income (but proving the business exists) to the ultimate alternative solution: a mortgage based on credit alone (no job required).
Buying outside the standard guidelines: Anytime your needs exceed the conventional guidelines for documenting income, source of funds, LTV, credit profile, etc., an alternative mortgage solution may be the best (and only) solution available to you. Your mortgage consultant will help you understand your options.
Less than perfect credit: Many times borrowers are pushed towards subprime mortgage solutions when other solutions may still be an option, including FHA or expanded conventional mortgage solutions. Make sure you connect with a mortgage consultant who has access to, and knowledge of, these solutions to ensure these options are evaluated first. When these solutions won't work, buyers with less than perfect credit will in all likelihood have access to a subprime solution.
No job: If you don't have a job at the time of your home purchase or refinance, you may still be able to secure financing with a no doc mortgage (traditional mortgage solutions require documentable income for loan approval). No doc mortgage solutions focus exclusively on the borrower's credit profile, requiring great to phenomenal credit. If you plan on buying without having a job, be sure to ask your mortgage consultant if this is an available option before you look for your new home.
Refinance: The rules for alternative mortgage solutions for refinancing are many times different than those for a purchase transaction. Speak with your mortgage consultant to ensure an acceptable refinance solutions exists.
The list of potential solutions is almost as long as the list of potential needs, with no way to document all options on this site. You can look here for more information about "Type Four and "Type Five" mortgages. And be sure to talk with your mortgage consultant about your financing options to ensure an acceptable solution is available for you.
For More Information: How much do I qualify for? Overview of the mortgage process.
Last updated: Monday, 10-Nov-2008 10:04:29 EST
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