The non-QM space is attracting more and more originators, but the non-QM loan process can be a complex one. That’s why Angel Oak Mortgage Solutions is implementing solutions to make the process faster and easier for originators and borrowers alike.
“We’ve implemented new systems and technologies that really seem to be paying off as far as ease of use,” said Tom Hutchens, executive vice president of production at Angel Oak. “We have what we call a bank-statement review team. We’re helping originators determine a borrower’s income very early in the process.”
One of the primary markets for non-QM loans is the self-employed borrower and those with other kinds of non-traditional income. But those borrowers bring a unique set of challenges that can slow down the loan-application process, Hutchens said.
“One of the big challenges with bank-statement loans is computing what the income is going to be,” he said. “It’s not traditional. You’re not looking at a W-2 that just gives you a number. We rolled this bank-statement review team out at the beginning of the year, and the feedback we’re getting from originators has been outstanding.”
Originators working on a bank-statement loan simply gather the borrower’s bank statements and upload them through Angel Oak’s secure portal. Within 24 hours, the company’s bank-statement review team will get back to the originator with the borrower’s approved income, Hutchens said.
“It saves a lot of time, and it creates a lot of clarity early on,” he said. “The traditional way of completing bank-statement loans would be for the broker or loan officer to gather all the documentation then send it to the lender to find out if the income will work. They may not know the loan won’t work until pretty far into the process. But that’s one of the first things we do – and once they know the income, they can determine if the borrower will qualify.”
The advantages of this system are twofold, Hutchens said.
“It saves time for an originator having to do all the work – but just as importantly, it saves them from having to do that work if there is no loan,” he said. “By the time you send a loan to underwriting, the borrower has had to gather a lot of documentation – everything that’s required for the loan. By doing it this way, the borrower isn’t wasting their time, and the loan officer isn’t wasting theirs.”
Hutchens said that feedback about the bank-statement review team has been uniformly positive.
“We’ve been asking people how it’s going, and the consensus across the board is how effective it has been at saving time,” he said. “And we’ll continue to roll out enhancements, as it’s our ongoing mission to make doing non-QM loans with Angel Oak easier.”