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Second
Mortgages
You can scroll down
this page or use these links to jump to information on the following
types of Second Mortgages:
Second Mortgages up to 100% Loan-to-Value
Second Mortgages at 125% Loan-to-Value
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Second
Mortgages up to 100% Loan-to-Value
Description:
A second mortgage can be a fixed rate or a Home Equity Line of
Credit (HELOC). A second
mortgage can be:
up to a 180, 240 or 360 month amortization,
interest only, or
a payment of 1% or 1.5% of the balance ($100 minimum payment)
If you want a 15 year fixed rate without a balloon, you will have
to expect that the rate will be higher.
No cash-out is available in Texas, however, purchase money second
mortgages are available. Some cash-out limitations apply on Non-Owner-Occupied
(N/O/O) properties.
Most investors who offer 100% LTV financing use empirical/FICO scoring
as the only credit determination. If both borrowers are under 620,
it is highly improbable that they will approved. If they are under
620 and have ever had a bankruptcy, they will probably be denied
on any CLTV over 85%.
Eligible properties:
1-2 family Owner-Occupied (O/O)
Condominium
3-4 family O/O (exception basis)
Second home (LTV restrictions apply)
Non-Owner-Occupied (N/O/O) -
Now lending 90% LTV on Investment properties
Loan Limits:
Minimum of $5,000
Maximum of $100,000 (or higher on an exception basis)
| Owner Occupied |
Maximum LTV |
Investor N/O/O |
Maximum LTV |
| Single Family |
100% |
1-4 Unit |
90% |
| Condominium |
100% |
N/O/O Condominium |
80% |
| Second Home |
90% |
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Ratios and Rates:
We use many different investors in many different markets. Most
will allow a 50% back-end ratio. Every investor grades a submission
differently, however, an approximate quote on a HELOC (not a fixed
rate) would be:
80.00% or less LTV: Prime plus
1
80.01% to 90% LTV: Prime plus 2
90.01% to 100% LTV: Prime plus 3
Second
Mortgages at 125% Loan-to-Value
Description:
This program is designed for homeowners who may have little or
no equity in their property, but do possess good-to-excellent and
verifiable income. It is for those seeking to make home improvements
as well as consolidating debts. Being that it is credit based, a
high empirica scoring is necessary. For Grade A, a 645 or greater
empirica is needed. For Grade B, a 625 to 644 empirica is needed.
For Grade A, no bankruptcies, judgements, liens, charge-offs, collections
or foreclosures. For Grade B, no bankruptcies or foreclosures in
the last 3 years, and all derogatory past credit must be satisfactorily
explained.
Products Available:
First, second or third mortgages at 15 or 20 year fixed rate.
Eligible properties:
1-2 family owner-occupied, townhouses and condominiums (some limitations)
Loan Limits:
Minimum of $10,000
Maximum of $65,000 (depending on empirica)
Up to a maximum of 65% of the loan can be used for debt consolidation,
except when a mortgage/lien is to be paid in full with the proceeds.
Maximum Loan-to-Value:
125% based on drive-by appraisal, full appraisal, original sales
price or state maximum. Third mortgages must have full appraisal.
Ratios and Rates:
Maximum ratio of 45%
Fixed-income applicants limited to 40%
Minimum disposable income of $1,200 monthly
Improvements and Disbursements:
The funds can be used for any
worthwhile improvements. Checks will be made payable to the borrower
for the home improvement portion of the loan.
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