Quontic Opens Up Access To Non-QM Mortgage Products

Quontic re-launched its non-qualified mortgage products for one-to-four family owner-occupied home loans, as well as non-QM loans for one-to-four family investors using a non-traditional debt service coverage ratio. These products are available through Quontic's wholesale lending division.

When the COVID-19 pandemic hit, the majority of non-QM lenders pulled out of the market over liquidity constraints, capital losses as well as a number of other factors. Quontic did pause non-QM activity as the pandemic continued to affect the country, however, it has since begun aggressively offering its non-QM product line with rates and terms to keep non-traditional borrowers and investors in the homebuyer market, according to a press release.

Also, today Citadel Servicing Corporation announced it is resuming the origination of non-QM loans. They were suspended in the wake of the COVID-19 pandemic.

"The market for non-QM loans came to a screeching halt during the pandemic. There was still borrower demand, but most non-bank lenders lost their financing and thus their ability to make non-QM loans," said Steve Schnall, founder and CEO at Quontic. "Consistent with our mission as a CDFI, our non-QM products are designed to enable underbanked populations like gig economy workers, immigrants, and seniors to obtain home mortgage financing for both owner-occupied and investment properties with borrower-friendly products for those who don't meet the rigid income documentation guidelines mandated under Dodd-Frank and ATR."

"The pandemic caused a lot of confusion and uncertainty for borrowers. For owner-occupied home mortgages, most non-QM lenders require the borrower to submit 12-24 months bank statements in order to attempt to extrapolate the borrower's income from their deposit activity and oftentimes this results in a denial for nontraditional buyers," added Lee Ann Casanova, director of the mortgage wholesale division at Quontic. "Quontic does not require a stack of bank statements as we can rely on other more objective factors such as credit score, self-employment and equity contribution."

Read more about Quontic's return to the non-QM market.