…with One that INVESTORS will Love

School is starting, inflation is affecting everyone, and who knows what the hell is going on! There is a weird feeling in the air, but when it comes to Arizona it’s a better feeling than other states. We continue to see an influx of people moving to Arizona for multiple reasons which causes inventory to still be low. Even though the last month we saw that the numbers grew slightly, I wouldn’t expect to see that inventory number grow drastically anytime soon. Projections show that home values will continue to climb, just maybe not at the same rate as they were before.

Investor Cash Flow Loan
Investors, this product is the solution to all your problems! If you are an investor with long term rentals but have had trouble qualifying in the past, the investor cash flow loan is the minimum doc solution. The investor cash flow loan is specific to investors only. Below are the main characteristics to know about this product:

  • Purchase and Refinance Allowed
  • No income documentation from any tax returns
  • The loan is qualifying simply off the ability for the rent to cover the mortgage payment.
    – Example = Mortgage payment around $1000 per month

    • Rent for that property is $1200 per month
    • Property qualifies for the loan if the rent vs mortgage is at minimum 1:1 ratio or greater
  • Loan to Value Maximums
    – Purchase up to 80% loan to value
    – Refinance loan to values range from 70%, 75% to 80% depending on the type of refinance

Borrower with No FICO Score
If one or more borrowers do not have a credit score due to insufficient credit, the lender must establish an acceptable nontraditional credit profile. Nontraditional credit profile incorporates anything a borrower may make payments on monthly. An example of this would be monthly insurance, gym membership, phone bill, utilities etc. The lender must first check all three major credit repositories to verify the borrower’s credit history and confirm that the borrower does not have a credit score.

If the borrower’s credit information is frozen at one of the credit repositories, and no credit score is available from any other repository, the lender may underwrite the borrower following the requirements for nontraditional credit. If the borrower’s credit information is frozen at two or more of the credit repositories, the loan is not eligible as nontraditional credit even though no credit score is available.

The credit report will indicate if a credit score could not be produced due to insufficient credit. Lenders must ensure that the credit report accurately reflects the borrower’s information, such as the name, Social Security number, and current residence of the borrower to confirm that the lack of traditional credit was not erroneously reported because incorrect information was used to order the credit report.

Note: For certain loan transactions, one or more borrower(s) are required to have traditional credit as evidenced by a credit score.

Always feel free to contact me directly with any questions!

by Andrew Augustyniak, Peoples Mortgage Co