These questions will answer most basic needs. If more questions are needed please email the scenario or ask jumbo desk but remember to always:
A. Run the pricing engine first. EPPS for QM and LoanNex for Non-QM.
B. Include the 5 pieces of info (LTV, DTI, Loan, FICO, and Primary, Second Home, or Investment)
C. Ensure you have read and attended the LO Orientations. As an LO is it important you attend the weekly meetings in person. This will allow you to be proficient and knowledgeable with the latest guidelines and products available which in turn will help borrowers obtain the best possible lending solution.
D. Ensure you have read the Agency Underwriting Guidelines and Training on MGIC.
E. Keep in mind Underwriting Guidelines are constantly changing, these are just for quick reference; if exact information is needed you will need to check the underwriting guidelines.
- What are the DTI ratios for conforming and non-conforming loans?
- Jumbo QM loans will have a maximum DTI of 43% while Non-QM/Jumbo loans can range as high as 55%. Agency loans allow for up to 50% DTI.
- What is the maximum loan amount for a GMCC product?
- Product max can range from $1M to $20M. Most have a $3M maximum loan amount.
- What is the minimum FICO score for loans?
- For Non-QM loans it is usually 620, Agency is also 620, and finally QM jumbo loans are usually 680.
- What is the minimum amount of tradelines required on a credit report to qualify for a loan?
- For the Supra products it is 2 trades; every other product is 3 trades.
- When calculating an ARM loan can I use the introductory payment as the qualifying payment?
- We have two or three products that will allow the note intro rate to be used on a 7- or 10-year ARM but not on a 3- or 5-year ARM. The rest of the products will require the greater of the note rate or fully amortized payment.
- Can I use RSU income as qualifying income?
- Most products will allow RSUs as long as they have received it for 2 years and have a vesting schedule showing they will be receiving it for another 3 years and the company is publicly traded.
- Can I use Capital Gains income as qualifying income?
- Most products allow for this with three years taxes and proof of future sales. Therefore, if they sold homes, we would need to see home sales for the past three years on the schedule d tax return and inventory showing they have more homes they can sell.
- Do Capital Losses have to be listed on my income?
- Some products do require we list these losses if it has been occuring for multiple years.
- Can I use Asset Depletion to qualify?
- Asset depletion can be used on almost every product GMCC offers. It is important to know that whatever assets you use to qualify for income you cannot also use as reserves, no double dipping.
- Do I need rental history of two years to use rental income to qualify?
- We have a wide range of products that do not require rental history of 2 years to be able to use this as income.
- If I am selling or renting my departing residence can we ignore the mortgage payment?
- If you provide a closing disclosure you can ignore the payment with all products. If you haven’t sold the home yet we have quite a few products that allow you to have the applicant write a letter of intent to sell the property and we require equity of at least 20% in the property. If you wish to rent the property please provide a lease agreement along with a copy of the deposit check and first month’s rent.
- Can retirement distributions be used for income?
- Pension and social security income can always be used to qualify, if they are using 401k distributions or annuity distributions some products require six months distributions to see consistency, there are a few that don’t. We also need to see three years’ worth of payments in the account balance.
- Can I use bonus income if they switched jobs?
- We have one product that will allow new hire sign on bonus to be used as qualifying income if they received two years’ worth from Amazon. Every other product will allow bonus income with two years history. If they switched jobs but are in the same field most of the time an exception can be made.
- Do we have any Non-QM products that allow 90-95% on a jumbo loan?
- Long story short is yes, but keep in mind when the LTV goes up the DTI goes down. These products usually require a 38% reserve and/or more reserves than normal.
- Do we have a product that allows for an applicant on a student visa to apply for a mortgage?
- Yes, if they have an EAD card. This can be used for jumbo and agency.
- Can I use business funds as reserves?
- Most of our products allow for this especially if the applicant(s) own 100% of the business. Most of the time if they wish to use these funds as a down payment an underwriter analysis must be performed to ensure the business would not be severely impacted by the loss of funds. Another option is to obtain a CPA letter stating this.
- What is the borrower contribution limit when using gift funds for a jumbo loan?
- Most products require 5-10% of the funds being borrower’s own contribution unless the LTV is under 80%. Most only allow gift funds on a primary or secondary residence, no investment properties. However, we do have two product that will allow 100% gift funds when the LTV is less than 70% LTV.
- Can gift funds come from outside the country?
- Yes, as long as it is sourced.
- Can I use a non-occupant co-borrower on my file?
- We have a wide range of products that allow for this when the applicant is purchasing a primary or secondary residence. The DTI is also then limited to 43%. Some of the products allow for a blended ratio while others do now.
- Can my borrower use foreign income to qualify?
- We have a multitude of products that will allow foreign income to qualify as long as it is on their U.S. Tax Return.
- How long must my borrower be employed with a US company?
- Most jumbo products will require 2 years.
- How long must my borrower have a United States address?
- Most jumbo products will require 2 years.
- What is the maximum amount of financed properties my borrower can have?
- GMCC has a wide array of products that can allow unlimited financed properties assuming the LTV is at 70% or less.
- Do we have loans for Foreign Nationals?
- Yes, we have a few products that do cater to foreign nationals as long as the subject property is a second home or investment property.
- Do we have any no ratio no job no asset loans?
- Yes, most products require the property is an investment property and meet certain credit requirements. Some offer more favorable LTV ratios with a DSCR over 1.00. We do have a special product that allows for a primary residence purchase.
- Do we have bank statement loans?
- Yes, we have personal and business bank statement loans.
- How long must my applicant wait since their last credit event?
- Most of the time the requirement is 2 years for a minor credit event and 4 for a major credit event. There are some products that do have no waiting period or one year.
- Can the applicant use cash-out as reserves?
- We have quite a few products that will allow cash-out reserves.
- Can my borrower use boarder income as qualifying income?
- We do have two products that will allow for boarder income as long as they are present on the last two years taxes.
- What is the most acreage allowed for an applicant?
- The maximum acreage depends on the product, it can range anywhere from 5 to 20 acres max.