What Are Non-Conforming Loans?

Trevor Cole Commercial Corp. pic

Trevor Cole Commercial Corp.
Image: trevorcolecommercial.com

Trevor Cole Commercial Corp., Inc., specializes in providing small businesses and corporations a wide range of money-lending solutions, including non-conforming loans. Based in New York, New York, Trevor Cole Commercial Corp. serves clients throughout the United States.

Certain criteria qualify a potential borrower for an advance when applying for a loan at a bank. If they meet the criteria, which is outlined by government-sponsored agencies, they will secure what’s called a conforming loan.

If they do not meet those loan standards, another lending option includes what’s called a non-conforming loan. Typically granted by institutions that are not banks, non-conforming loans allow for individuals or companies with poor credit to obtain capital for the homes or projects.

They also enable those with excellent credit to secure capital with a higher limit, than that of conforming loans, enabling these borrowers access to greater loan amounts.

In contrast to conforming loans, non-conforming loans may not have as low of interest rates. These such loans may require underwriting guidelines that differ. However, Government-sponsored agencies do not back such loans. Moreover, may require larger down payments upfront, additional fees, and tougher underwriting rules.

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