Our Pricing Engine, by the way, is an on-line database that lets us instantly compare approximately 30 of our 45 lenders after we input a particular loan scenario. Such Engines are invaluable in today’s mortgage arena because there are so many parameters that influence pricing or rates. These parameters include Loan-to-Value Ratios, Credit Scores, Impounds, etc.
First Nationwide/Cal Fed used to offer “No Income Verification” loans up to 65% Loan-to-Value. The borrowers had to have FICOs above 720 and substantial liquid assets, and the rates were fantastic. The default rate on those loans was virtually zero.
Such loans are not available today because there is no secondary market for them and banks are afraid to hold them. This is because new regulations make it impossible to rate securities backed by such loans, and banks are uncertain how much capital is required to hold such loans. Once new rules are established or once the regulators back off somewhat, expect such loans to quickly surface again. But do not expect this in the near future due to the current state of regulatory confusion.
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167