Fitting a Square Peg
Into A Round Hole

The “Square Peg” is the Borrower/Buyer and the “Round Hole” the underwriting guidelines.

The Borrower/Buyer comes in many different varieties from W-2 employees, Retirees, Self -Employed, Investors, ETC. The Underwriting Guidelines also come in many different Varieties from the buyers or Insurers of the mortgages, be they Fannie Mae, Freddie Mac, FHA, VA, Banks, Hedge Funds, Insurance companies, ETC.

The Borrower/Buyer’s goal is to secure financing for their home or rental property and they are best served by seeking advice and Pre-Approval from a Mortgage Professional who has the experience and access to a number of funding sources. Not every loan fits every borrower and making the Square Peg fit the proverbial Round Hole takes experience, knowledge and an ear for the customers’ needs. A Mortgage professional knows the underwriting rules and can advise on how to round out some of the rough edges on the Peg and precisely match the Borrower/Buyer to the best loan program(s).

Underwriting Guidelines are designed to meet the level of risk that the Buyers or Insurers on the loan find acceptable:

  • The strictest Guidelines are for Jumbo Loans, loans greater than $679,650 in Orange and Los Angeles Counties.
  • Next are Fannie Mae, Freddie Mac, FHA & VA, each have variances in their guidelines that will handle special income and credit situations differently and these all require Income and asset documentation.
  • Finally we get to Non-Qualifying Mortgages which will take greater risk levels. These include self employed borrowers who can be qualified with copies of 12-24 months of bank statements to verify income instead of tax returns, stated Income Loans, loans to Non-Resident Aliens and Cash Flow only loans on Rental Properties.

Remember the greater the risk the higher the interest rate so be sure to speak with a knowledgeable Mortgage Professional who can advise what best fits your needs, not the other way round!

Tim Shuey and Maritime Mortgage have been originating Residential and Commercial Mortgages more than 30 years throughout California. Call us with your questions. We have knowledge to share.