Interest only Mortgage Lenders 2015Only interest mortgage lender 2015
The UWM also happens to be a wholesaler mortgage financier, implying that they work with mortgage brokers who link with home-owners. Not only mortgage agents but also esoteric forms of credit such as pure interest rate mortgage have been held responsible for the recent real estate crises, but this year things seem to be a little different, at least for now.
Lenders who claim to be "one of the nation's biggest and fastest-growing major lenders" have some fairly strict credit standards. One you need a minimal FICO score of 720, so there is certainly no sub-prime concern - only material that floats around. This is certainly important given the fact that a pure interest rate borrowing only disburses interest and no capital.
Thus if house prices should be low or drop lower, the borrower could wrap up with little to no equities to act as a cushion for the lending institution in the event of arrears. One could say that this is quite different, even if it is still a pure interest mortgage.
While preparing for the crises, it was customary to see IO mortgages without cash that only needed sub-prime credits. This means they can buy a fully amortising mortgage, but they just want to make interest payments so they can put their funds elsewhere. They should also gain a comparative advantage by having a broader choice of products to make an offering to the borrower.
In terms of recording, their IO products are just like the gear that came before them - a 10-year IO term followed by a fully amortising 20-year pay-back time. This means that the mortgage repayments will start to leap once the first 10 years are over, although if these borrower are really skilled, they should be able to deal with it.
Prior to blogging, Colin worked as an advisor to a mortgage financier in Los Angeles. He' been passionate about mortgage lending for 12 years.