Another lender is trying to fill the gap created by the Consumer Financial Protection Bureau's Qualified Mortgage rules, which have prevented many potentially credit-worthy borrowers from obtaining a mortgage loan because of the strict CFPB lending standards.
On Q Financial is set to launch a new non-QM lending program, targeted at borrowers left behind by the CFPB’s mortgage rules. According to the company, On Q Financial’s new program includes solutions for self-employed or recently retired borrowers, individuals with a short credit history or flawed credit from a past short sale or foreclosure.
Additionally, On Q will also be offering debt-to-income ratios up to 50% on certain products and will be introducing a 40-year amortization jumbo loan with an interest-only option in the coming weeks.
“We recognize that many lenders are continuing to impose strict standards, burdensome policies and credit overlays for self-protection, but at On Q we are focused on helping well-qualified customers get into homeownership,” said John Bergman, founder and president of On Q Financial.
“There are a lot of responsible people that don't fit into the QM box that are getting shut out of the market,” Begman added. “It’s been ten months since QM regulations have been in effect and we are confident that with our sensible underwriting standards, these non-QM loans will provide an ideal solution for On Q, our investors and our borrowers.”
On Q, which has offices in Arizona, California, Colorado, Florida, Georgia, North Carolina, South Carolina, Texas, Utah and Washington, also announced that it will also “relax” its underwriting credit overlays.
“We will reach the under-served market of borrowers who have ample equity and assets, but may be challenged by income or credit factors,” the company said in a release. “At On Q, we have the ability to make decisions intelligently, on a loan-by-loan basis while still ensuring that the loan meets responsible standards.”