Since lenders felt that non-conforming loans were riskier than conforming loans, they required a higher return on their funds. Recently, this traditional way of making mortgage loans has undergone changes in some lending circles. By combining the elements of a reasonable down payment and slightly higher rates, some lenders are finding it more attractive to offer non-conforming loans. Bankruptcy - The applicant may have had a Chapter 7 or Chapter 13 bankruptcy filed during the last two years. Some programs even assist satisfying the applicant's Chapter 13 bankruptcy plan.
Some programs help an applicant to reinstate a loan currently in foreclosure.
Down Payment Requirements - The amount of money required for a down payment on nonconforming loans is usually higher than for conforming loans due to the risk lender perceive in these loans. Generally, the down payment can be as low as ten percent of the appraised value or the sale price of the property. The additional types of properties that are allowed are residential acreage with proven marketability, mixed use properties where a portion of the property is used for commercial purposes and modular homes. Loan Programs - There are a variety of loan programs that can be tailored to meet the needs of the individual applicant.