A portfolio loan is a loan that is serviced by the lender that issued the money. Here are the basics of the portfolio loan and how it works and how a Portfolio loan can help you.
In many cases, loans that are issued by a lender are packaged together with other loans and sold on the secondary market. With a portfolio loan, the lender that initially wrote the loan is going to hang onto it and keep it as part of their investment portfolio.
Unique Income Situations
- Self-employed borrowers are often paid sporadically and at different times and require unique underwriting criteria than conventional loans cannot utilize.
- Restrictive Stock Units (RSU): Many borrowers are compensated via RSUs and need to utilize RSU's as part of their underwriting criteria to qualify for their loan.
Luxury Portfolio Jumbo
- Departing Residence: Rental income from departing residence can be used to qualify for a new home.
- Cross-Collateralization: Allows the borrower to utilize the equity in their current home for sale to qualify for the home they wish to purchase. Allows Realtors and the clients to potentially place "non-contingent" offers in a tight market.
- Re-Casting: Once the former residence is sold, the borrower is allowed to pay down their new home loan and "re-cast" the payments based on the new balance without any cost or changes to the terms of their home loan.
- ARMS: Programs such as 5, 7 and 10/1 ARMS often offer lower rates that make payments more affordable.
- Interest Only: North Star Mortgage offers some programs and ARMS with an interest-only feature, including up to a 40-year term!
- Sample: Loan up to 2M, 7/1 ARM I/O, 40-year term, 80% LTV - Primary Residence.
- Loan amounts above 2M also available at lower LTVs.
If a lender keeps your loan as part of their portfolio, it can benefit you overall. Instead of having to work with a lender that is going to service your loan from another location, you will be able to keep your relationship with the lender that you originally worked with. By doing this, you will be able to contact them whenever you have a problem. Your customer service experience should improve.
Portfolio loans are often the solution for borrowers’ that have larger loan requirements and have unique loan requirements that conventional loans cannot meet.
Get started now to start the pre-approval process or give me a call at (408) 402-5936 with any questions that you may have.
*Rates, programs, and products are subject to change at any time and do not represent a commitment to lend*