Plaza Home Mortgage has expanded the guidelines of its wholesale and correspondent non-qualified mortgage program to allow using bank statements for documenting income.
The change made to Plaza’s Solutions Non-QM program allows borrowers to use 12 or 24 months of personal and business bank statements. Or the borrower can fully document their income over the same period.
Having a jumbo product to offer borrowers this year was important to 83% of the participating originators in the 2019 Top Producers survey. At just under half, 48% said having a non-QM product other than a jumbo loan was important, while 33% said that being able to offer another type of private-label loan was important.
There is a concern that using bank statements to verify income on nonagency mortgages eases underwriting guidelines too much, a report from Moody’s said.
And income-related application fraud is likely to rise with a strong, competitive, spring home buying season expected, a First American report on defect risk pointed out.
With the expanded program, mortgage brokers can send in the bank statements to Plaza and it will calculate the borrower’s qualifying income prior to loan submission.
The program also offers mortgage brokers and correspondent sellers underwriting on a delegated or nondelegated basis, loan amounts up to $2.5 million and debt-to-income ratios up to 50%.
There are also interest-only options; expanded eligibility on all document types and lower reserve requirements.
“In today’s tight environment, originators create value and build relationships by being problem solvers. This requires a wide and expanding array of products and tools at their disposal,” Michael Fontaine, chief operating officer and chief financial officer at Plaza, said in a press release.
Plaza just rolled out a one-time close, construction-to-permanent mortgage program through its wholesale division.