Homebuyers turn to non-bank mortgage companies for home loans
House hunters who can’t quality for mortgages through traditional channels are turning to non-bank loans to get them into new homes.
Imortgage exec Michael Stowers told HousingWire that 20% of its loans go to customers who were referred to the online lender by traditional banks that have rejected the clients for not meeting stringent requirements for down payment, credit score and debt-to-income ratio.
More than 46% of the loans purchased by Fannie Mae and Freddie Mac in the first three quarters of 2013 were from non-bank mortgage lenders, according to the Federal Housing Finance Agency.
Some non-bank lenders have come under scrutiny by the government for their lending practices, making some borrowers wary of using them. For many homebuyers, however, nontraditional mortgage sources are their only route to homeownership.
- HousingWire.com Economist: Jobs key to selling more new homes NAHB economist says unemployment is biggest obstacle to first-time homebuying As the economy improves, young adults will start purchasing houses, he predicted. The housing recovery depends on new jobs and first-time homebuyers, David Crowe, chief econom