That “dramatic” expansion, according to Betancourt, has arrived in part thanks to growing understanding among a wide swathe of borrowers, not just in the Hispanic community, of the viability non-QM loans can offer. “If you’re a self-employed borrower, there are other alternatives to the traditional way of qualifying, which is what non-QM aims to fill – a void,” he said.
“After that, you see our community – the Hispanic community – follow along, and a lot of that has come with interactions with the agents and some outreach that we’ve done a lot over the years to let our partners know that these programs are available. It’s a lot of education more than anything, and it’s finally showing.”
While some mortgage professionals and borrowers may have viewed the space with a degree of trepidation having been stung by the subprime bubble that precipitated the global financial meltdown in the late 2000s, Barrera said plenty of effort had gone into highlighting the significant differences between non-QM and those far riskier loans.
That’s served to ease fears about the sector, he said. “The borrower has to have reserves and we have to see a consistent way of them making income – an alternative route [when] banks are not giving them any options to become homeowners,” he said.
“Once we got past that and people started seeing that this is real, and we’re getting people in homes, that’s when it clicked. And now as a result of that, here we are. We have a big, booming market, year over year it’s growing, and we have a lot of competitors.”
Source: mpamag.com