Non Conforming Loans

Not all borrowers fit within the stringent lending criteria of the more traditional bank and non-bank lenders. Issues which may be affecting someone’s borrowing ability can include paid and unpaid defaults on their credit report, non-genuine 5% savings deposit, borrowing to consolidate debts, current or past repayment arrears, or casual employment. If any of the above circumstances are affecting someone’s ability to get finance approved, a Non-Conforming lender and loan product may be appropriate to consider.

Non-Conforming lenders are much more flexible than traditional lenders and will consider each application based on its merits, and not discredit a loan proposal just because it does not fit perfectly within traditional lending criteria.

The flexibility offered by Non-Conforming loans does come at a cost however. Generally the fees and interest rates will be higher. They can however, be a great way to rebuild a borrower’s credit rating by establishing 12 months of good repayment history, and then the borrower can refinance to a more traditional home loan product on a better rate.