NON-CONFORMING LOANS

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Non Conforming Loan2018-09-21T00:39:15+00:00

NON CONFORMING LOAN

A Non Conforming Loan is for those who require a mortgage outside ‘traditional’ loan criteria, such as poor credit or employment history, or where the loan may exceed 80% of the security’s value.

A Non Conforming loan should not be confused with a Lo Doc loan. While it is true that both types of loan are available to those who are a little ‘outside the square’, a Non Conforming loan is for those whose circumstances place them outside normal lending criteria.

For example, you may have just commenced at your place of employment, or perhaps have been in financial difficulty in the past and therefore have a blemished credit history.

A Non Conforming loan can also apply to loans where the amount exceeds 80% of the property’s value, or whose total value may be higher than usual, or perhaps the property is an apartment or large property that doesn’t fit normal lending criteria. When deciding on a non conforming home loan, consider the following:

  • INTEREST RATE:
    Bad credit home loans generally do have a higher interest rate, which is why it’s so important to compare home loans to ensure you’re getting the best deal in this category.
  • COMPARISON RATE:
    Always check the comparison rate because it represents the true cost of your home loan. Since you’re already paying a higher interest rate, you don’t want to pay any more than you need to.
  • FEES:
    Another aspect to take into account is the amount of fees that you will have to pay. For instance, does the potential loan provider have any hidden fees or are they upfront about their extra charges? It’s crucial for you to know this information so that you won’t be surprised with any additional expenses.
  • REPAYMENTS
    When selecting the most appropriate lender you must be well versed in the loan repayment schedule. This will allow you to be more organised and know exactly when all of your monthly payments are due.
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