Non-status homeowner loans are targeting to borrowers who struggle to qualify for traditional bank financing. If you have less-than-perfect credit, limited financial documentation, self employed income or other barriers, a non-status mortgage may be your solution for accessing equity in your home. Here’s how to shop and compare online lenders offering these alternative homeowner loan options.
Defining a Non-Status Mortgage
The term “non-status” refers to mortgage loans that do not meet mainstream or “status” programs offered by large banks and credit unions. They are instead flexible loan types that allow for things like Alt-A documentation, non-prime credit, or prior consumer proposals.
Also known as low doc or “B-Lending” programs, these specialty loans prioritize the equity you hold in the home rather than solely relying on credit scores or taxable income to determine your eligibility. The funds can be used for any purpose such as home renovations, paying off high interest debt, or accessing cash reserves.
Who Offers Non-Status Mortgages?
Most major retail banks do not offer specialty non-status loans. Instead, many non-bank or private lenders have carved out a niche catering to alternative borrower profiles that do not meet strict status loan guidelines.
Some notable non-status home financing companies offering online access include:
– MortgagePal – Low doc, stated income mortgages
– Resolve Financial – Consumer proposal friendly financing
– AltFi Mortgages – Solutions for 500+ credit scores
– Lendwise Financial – Alt-A mortgages and unstated income
– iMortgage Solutions – Mortgages for self-employed borrowers
These companies operate primarily online and are able to assess and approve applications with a wider scope than mainstream banks. Deploying flexible alternative qualification criteria allows them to say “yes” more often.
What Do You Need to Qualify?
Non-status lenders emphasize the amount of equity you currently have in your home as the key indicator for mortgage approval – not just your employment history or credit scores. Your home value, existing mortgage balance, and available home equity versus requested loan amount is prioritized. Minimal paperwork and a wider borrower mandate facilitates quicker approvals.
Here are some general guidelines on non-status mortgage eligibility:
– 25% minimum home equity
– Stable income source (less documentation required)
– Re-established credit and consumer proposals accepted
– Flexible self-employed income verification
– Bankruptcies, past defaults may be permitted
– Unmortgaged or rental properties may qualify
Requirements and rates will vary for each lender based on their non-status mortgage products and risk evaluation criteria. Applying with an online broker provides access to multiple alternative financing options under one roof.
FAQs on Finding Non-Status Homeowner Loans Online
Q: Will I still get a fair interest rate with a non-status loan?
A: Online non-status lenders offer very competitive rates – often not far off prime bank posted rates. The flexibility and convenience of quicker approvals counterbalances slightly higher interest rates in most cases.
Q: How much cash can I get from a non-status refinance?
A: This depends on the appraisal value of your home, your current mortgage balance, and lender loan-to-value (LTV) ratios. Many lenders will fund 60% to 80% of your home’s current value less your current outstanding mortgage.
Q: Is the foreclosure process different than a regular mortgage?
A: Foreclosure is always a last resort if you default on payments. Most non-status lenders will work diligently with borrowers facing financial struggles before initiating power of sale proceedings in order to protect their and the borrower’s equity position.
Q: What documents do I need when applying?
A: Basic identification, proof of property ownership, proof of income, and mortgage statements covering the last 3 months will be required. Alternative lenders rely less on tax documents or employer confirmations for income verification.
The bottom line is non-status loans cater to a wide range of borrowers who do not qualify via mainstream mortgages. Working with an online broker simplifies exploring multiple alternative financing solutions for your unique scenario. Be sure to read the fine print and understand terms before signing your loan agreement.