Specialties
Mortgage specialties, explained.
The 32 mortgage specialties LenDb tracks: property types, loan programs and borrower situations, each with what it is, why it is hard and what to ask a loan officer.
Specialties never describe protected characteristics. Languages are tracked separately.
Property types
- Condo. Financing a unit in a condominium project, which requires the lender to review the project as well as the borrower.
- Non-warrantable condo. A condo in a project that does not meet Fannie Mae or Freddie Mac guidelines, so it needs portfolio or non-QM financing.
- Co-op. Buying shares in a housing cooperative corporation rather than real property, common in New York City.
- 2 to 4 unit property. A duplex, triplex or fourplex, either owner-occupied or as an investment.
- Manufactured home. A factory-built home on a permanent foundation, financed as real property or as a chattel loan.
- Rural property. Homes on acreage, in remote areas, or with wells, septic systems or agricultural use.
- New construction. Buying a newly built home from a builder, including spec homes and homes still under construction.
- Mixed-use property. A building with both residential and commercial space, such as an apartment over a storefront.
- Condotel. A condo unit inside a hotel or resort that operates a rental program.
- Vacation home. A second home for personal use, sometimes rented out part of the year.
Loan programs
- FHA loan. A government-insured loan with low down payments and flexible credit guidelines.
- VA loan. A loan guaranteed by the Department of Veterans Affairs for eligible service members, veterans and surviving spouses.
- USDA loan. A zero down payment loan for eligible rural and suburban areas with income limits.
- Jumbo loan. A loan above the conforming loan limit for the county.
- Non-QM loan. Loans outside the Qualified Mortgage rules, used for borrowers or properties that agency loans cannot serve.
- DSCR loan. An investor loan qualified on the property's rental income (debt service coverage ratio) rather than personal income.
- Bank statement loan. A non-QM loan that qualifies income from 12 or 24 months of bank deposits instead of tax returns.
- Reverse mortgage. A loan for older homeowners, usually a HECM, that turns home equity into income without monthly payments.
- Renovation loan (203k / HomeStyle). A loan that finances the purchase or refinance plus the cost of repairs, such as FHA 203(k) or Fannie Mae HomeStyle.
- Construction loan. Financing to build a home, often a single-close construction-to-permanent loan.
- HELOC. A home equity line of credit secured by the borrower's home, usually behind a first mortgage.
- Down payment assistance. State, county or lender programs that provide grants or second loans toward the down payment and closing costs.
Borrower situations
- Self-employed. Borrowers who own a business or work for themselves, whose taxable income may understate their cash flow.
- First-time buyer. Buyers purchasing their first home, often with low down payments or assistance programs.
- Real estate investor. Borrowers buying or refinancing rental and investment properties, including those with several financed properties.
- Foreign national. Borrowers without US residency or US credit history buying property in the United States.
- ITIN borrower. Borrowers who file taxes with an Individual Taxpayer Identification Number instead of a Social Security number.
- Low credit score. Borrowers with credit scores below typical conventional minimums.
- Recent credit event. Borrowers with a recent bankruptcy, foreclosure, short sale or deed in lieu.
- Physician and medical professional. Doctor loan programs for physicians, dentists and other medical professionals, often with low down payments and no mortgage insurance.
- 1099 income. Independent contractors and gig workers paid on 1099 forms.
- Asset-based qualifying. Qualifying from liquid assets (asset depletion or asset utilization) rather than employment income.