New options to help brokers and correspondent lenders capture more of the non-agency market
Deephaven has rolled out new income qualification options to allow its broker and correspondent partners to fill a large market gap for non-agency loans.
Offered exclusively under Deephaven’s Expanded-Prime program, the new alternatives, which include asset and debt ratio calculations, enable loan officers to determine the borrower’s qualifying income based on a broad range of assets (personally held stocks, bonds, mutual funds, vested amounts of retirement accounts and personal bank accounts).
“If borrowers have sufficient assets to meet the down payment and reserve requirements, make 60 months of monthly debt payments and pay off this mortgage, they are likely to be deserving customers,” said Shelly Griffin, senior vice president of client development at Deephaven.
Deephaven’s new asset utilization options include:
- Total Asset Calculation—The company will offer mortgages for borrowers whose assets cover the new loan amount, down payment, closing costs, required reserves and five years of current monthly obligations. It is not necessary to disclose their employment or total income on a 1003 Form.
- Debt Ratio Calculation—At minimum, borrowers must have the lesser of (a) 1.5 times the loan balance or (b) $1 million in qualified assets, both of which must be net of down payment, closing costs and required reserves. Monthly income is calculated by dividing net qualified assets by 84 months.
The non-QM lender noted that this utilization approach is not available for cash-out transactions. If a portion of the assets will be used for the down payment, closing costs or reserves, Deephaven will not include them from the balance before analyzing the entire portfolio, the company said in its release.
“In this competitive market, Deephaven is bolstering each partner’s ability to capture their business before others do,” Griffin said.