Welcome to Daily Rates Live with the mortgage calculator. My name is Nick Hiersche. I am the president here. We go ahead and do this for him. We will go ahead and get started with the live rates today, and then we'll have Jose, our sales manager, go into a deep dive on the topic for today, low FCO score loans. So let me change my screens and we'll check out the rates today. All right. This is our pricing tool for our team. This will show us the general rates and the a PR for today. It is December 7th, just after 11:00 AM Eastern. So all of our general programs are live here. So we will set up a basic scenario, compare across the programs, so we can compare the A PR if you'd like. A full breakdown, a full loan estimate. Please get with one of our team members. We have over 400 licensed loan officers in 24 states. For the demos, we'll set up a 400,000 loan amount. We'll set up a 80% loan, 20% down payment. We'll look for the lowest rates we can offer for conforming. Then we'll check out FHA, and then we'll go into our expanded guidelines, also known as non qb, where we have over 5,000 additional loan programs. We also have VA and USDA VA's only for eligible vets and active service members. If you are, just let us know. SDA is only for eligible properties. If you do happen to be looking there, just let us know. We're gonna start with conforming purchase, 30 year fixed loan, primary occupancy, single family home, one unit, state of Florida County, Miami-Dade, and for all the demos, we use a credit score of seven 60 and a debt to income ratio of 40. So at these basic settings, let's check out the options. All right. Rates went down yesterday as we expected, which is awesome. Best option today, 6.375. Rate 2.375. Discount points in cost, plus the final a PR 6.659, which is lower than the 6.8 or so we were at yesterday and much lower than a couple weeks ago. We were at the highest rates in many years, so definitely good news, especially for our borrowers out there shopping now. For any reason our borrower has trouble qualifying for conventional. The next option we wanted to check out is an FHA program. FHA allows more leniency on credit issues as well as a higher debt to income ratio. However, we will keep the example exactly the same so that we can compare apples to apples across the programs and compare the a PR. So let's check out the FHA option here. It's pretty much just similar to what it was yesterday. 5.75 rate for 2.25 discount points in cost, puts a final a PR 6.675. So almost identical there for conventional and FHA today. Sometimes they'll flip flop a little bit there. And definitely good news for our customers. It must use it. FHA and conventional have both gone down. Now, if our customer doesn't qualify for FHA or conventional, using full documentation. Many other banks or lenders will have to deny that customer, but that's where we love to specialize. Here at the mortgage calculator, we have over 5,000 other options. Many banks or lenders do not have here under expanded guidelines, also known as non qm, where we can use different income. So everything stays the same here, but now we can select a new income type. Full doc is what we use for conventional and FHA. So that's two years of tax returns. We would probably not select that option here if we don't qualify using that option. So we'll typically use one of these alternatives. We have asset related programs, business bank statement investor programs, or just for investment properties. We'll talk about that shortly. Personal bank statement, 12 month. This is the program we use for the demo. This is the most popular. We also have RSU stated Income, the OE 10 99 programs, p and L programs and no income CDFI programs. The 12 month personal bank statement is the most popular for our self-employed borrowers. Many times it's our self-employed borrowers when they submit two years of tax returns, may have various. Write-offs and may not qualify at all or just may need a little bit of extra income. Either way, we can solve the problem. No tax returns at all. Just their last 12 bank statements here to determine a debt to income ratio of 40%. In our example, using no tax returns at all, just cash in the bank. So many of our self-employed borrowers qualify for double or more income using that method and can therefore get that home they really want. So let's check out the options today. again. Non QM doesn't change much, so it's about the same every day. It was beating conventional for a while there but now conventional has dropped pretty good. This is more normal here. Best bank statement, option 7.6258. 2.375 discount points and cost, but so final a PR 8.053. So about one point, a little more than one point higher here for a bank statement compared to conventional, which is typical here for our borrowers that need to use these programs. The one point differences vary nominal, and there's tons of different options here. If you scroll down. Some of these bank statement options at higher rates and costs may allow bankruptcies, foreclosures, other issues that would cause our customers to not qualify. Some may use slight variations on the way we calculate income. There's hundreds if not thousands of variations here. Please get with our team to find the best ones. And before we get into Jose's low FICO score examples, we still wanna do our live rates for investment properties as we do every morning. So we'll do a couple demos here for investments. We'll do the same setup, 80% loan to value, 20% down payment. We're going to find the absolute lowest rates we can offer for conforming conventional and our expanded guideline Non QM member FHA Via USDA. All the government programs do not work for investment properties, so we'll start with conforming conventional. Everything's gonna stay the same. All we've edited here is the occupancy to investment, so we can see the adjustments the conventional programs have when we do an investment. It's obviously quite a bit higher rates here, but that's typical here. 7.124 rate for 3.25 discount points in costs, puts the final a PR 7.521 for an investment property which is pretty reasonable here for any customers that wanna take advantage of conventional. It's becoming much more reasonable. We were beating conventional with a lot of non QM programs before and now this is more normal. So definitely excited to have some good options there for our customers that need it. However, most customers also want to compare a non QM option. So for the final demo, we will do investment property. We'll do our A DL TV V again, and this time we will select our expanded guidelines, also known as non QM for investments. And the most popular income type, which we must select first for investment properties going to be the DSCR. That's because it doesn't require any income or employment information from our borrower or documents on that. It simply use the estimated rental income from the property to determine A-D-S-C-R value. It stands for debt service coverage ratio if the estimated rents can cover the expenses. The P-I-T-I-A of the mortgage, that's a ratio of 1.0 or higher AKA. The property cash flows. We have options for under 1.0, but for the demo we always put 1.5 as the highest so we can see all the programs pop up. And finally, prepayments penalty is standard for these programs. Three years is what we always use for the demo. We can select zero that will limit what shows up and cost more. We could also select five, which will again limit what shows up since not all allow it, but does save money. Three years is most common. So that's what we use here. So let's check out the DSCR options today. Alright, super low option, which is awesome. Almost identical to conventional. Here we got a 7.375 rate for 3.25 discount points in costs. Puts the final A PR 7.889 for A-D-S-C-R. Remember, conventional was just over 7.5. I'd say 99% of investors, if the A PR is nearly identical as it is today, would choose A-D-S-C-R loan compared to a conventional loan. So still a lot of DSCR activity and non QM activity in general, because the investment property rates under conventional are definitely a little bit higher. Now, if we scroll down here, there's a ton of different options here for DSCR. Some of these may allow bankruptcies, foreclosures, other credit issues. Some of these may allow us to use different ways to calculate income, such as short-term rental income, very popular topic, and just hundreds of different variations. Please get with our team to find the best ones. All right, and now let me introduce our topic for today. It's going to be our low FICO score loan options. So it's a little bit difficult to do that on the live rate show when we have certain niches where there are certain specific programs for lower scores. So we'll have Jose Gonzalez, our sales manager for 28 years of experience. Let's go through some examples where we could select lower scores and find valid programs, which we're not really able to do on the live show when we're doing general demos. So Jose, if you got some options ready here, uh, hopefully you have a few examples for us. So you ready to go? Think you're muted still. How's everybody doing today? Thank you for joining us for Daily Rates Live with the mortgage calculator. Today we have a slew of loan options. What we have done here is try to select the lowest credit score for a number of different pro of our popular program options. So let me get right into it for you. Okay, first option is FHA, uh, with a five 80 credit score. Maximum LTV 96.5% fi five 80 is usually is the number, uh, that the most of the lenders, at least all the ones that I found are putting for obtaining 96.5%. You know, obviously would need also automated underwriting approval because this is assuming that we're being able to go to the maximum DTI for FHA. As well. So here we're looking at 7.25 as our lowest cost option and 6.125 as our lowest rate option. And now we have a FHA purchase with a 500 credit score. What you have to be aware of is that whenever you go below a five 80 credit score, you do have to lower the LTV to maximum 90%. To be able to get any pricing options, uh, and obviously when you're running your automated underwriting with a below five 80 credit score, you also have to be aware to set the LTV at 90 and also to run it as an interim. Selecting whoever is the investor that allows that in their guidelines, in their, in their overlays, because FHA does not really have a minimum credit score, but all of the investors and lenders add their own overlays. So in this case here we have 7.625, lowest cost option 7.125, lowest rate option. With a 500 credit score, 90% LTV, not too shabby. Keep in mind if you do have that low credit score, borrower, again, there's going to be two options. Your first option is going to be to run it through automated underwriting, which is going to give you the maximum DTI. Your second option then, assuming that your borrower does not have any derogatory credit in the last 12 months, that's no derogatory credit of any type. We're not just talking housing expense here, but any even consumer installment, if they do not have any derogatory credit and the DTI is set maximum at 43% or below, then it would be eligible for manual underwriting. USDA minimum credit score is five 80, and here we're looking at 7.75 with a little bit of a lender credit, 6.125 lowest rate option. Now, conventional keep in mind, conventional per the matrix, minimum credit score is six 20. So here we have 7.99 is our lowest cost option, 6.99, lowest rate option, and this is for a 97% LTV, first time home buyer option. Now the same 97% LTV with a six 20. Under HomeReady and remember, HomeReady and home possible are going to have very similar rates. Just one is Fanny, the other is Freddie. So there would be reasons other than rate to choose one or the other. One reason may be you have a self-employed borrower, which is usually better to go with Freddie. And the other, for example, could be a manufactured home, which is also better to go with Freddie. So here now you see much better rate when the, it's the home possible home ready. The only catch to this program this is not first time home buyer, by the way, you do not have to be a first time home buyer to participate in these two programs. These are income based programs or minority based programs. So if it is a low to moderate. So it is 80%, you can, you have to be at or below 80% of the area median income, unless you are in a low to moderate income census tract or are in a minority census tract, in which case there are no income limitations as to the max. So again, you see how much better it is. This one is 7% with lender credit. The other option was 7.99 with Out a lender credit, and you can take it down all the way to 6.125. Now on our VA loans, a hundred percent LTV maximum minimum credit score is 5 87 0.75 lowest. Cost option 6.625, lowest rate option. Now I'm gonna give you some non QM examples. DSER programs are our most popular programs. So that is the non QM options I will be showing you, even though we do have bank statement options and p and l, but I wanted to show with a 5 75, now we can do bank statement and other and other alt dunk options. A 5 75 credit score up to a maximum 65% LTV on a purchase. In this case, our DSER option is at an 11.125 rate. Now this is a borrower paid option, which means that any compensation paid is paid as a borrower paid option. So 11.125. Pretty good considering there's nobody else that's gonna come close to getting to a 65% LTV on A-D-S-E-R purchase with a 5 75 credit. I. Now, and that was again, 11.125. Now the full doc option, I did give you a full doc option of 5 75 just so you could compare not much difference in the rate 10.99 as opposed to 11.125. This is non-owner occupied. Full doc by the way. DSCR. Cash out is 5 75. Again, same LTV. We can take it all the way up to 65%. Now this is extremely amazing with a 5 75 credit score interest rate of 11.5. Now there are buy down options. Again, for all of these, I haven't provided the buy down option. This is essentially the par rate at 11.5. Now another little twist here. DSER 5 75 with a 0.8 to 0.99 with a 5 75. This is pretty amazing because we can still take this option to 65% LTV on a DSE or cash out with a less than 1.0 so your property's not cash flowing on a one-to-one basis. You're at 0.8 to 0.99. We can refinance you using DSER guidelines down to a 5 75 and now my last option is the low credit score for a 80% DSER cash out. This is not technically a low credit score option, but I wanted to highlight this option to everybody out there. 80% LTV. DSER cash out, right? That's the unicorn with a seven 20 or above. So the minimum credit score for the 80% LTV cash out, DSER for a one unit seven 20. And look at that rate, 9.374 at par. That's pretty amazing because I know a lot of 75% DSCR options that are at that rate. So 80% the DSCR investor unicorn available for you all day every day at the mortgage calculator. Let's see. There was one question earlier. Oh, just an example of low scores. Yes. So Jose had all the examples with low scores. Again, it's, it's kind of tricky, right? So he did like multiple examples.'cause the LTVs change, right? So just because you don't always get an option, make sure, uh, you check the LTVs and all that kind of good stuff. So if we don't have any more questions, I guess we'll wrap it up. Thank you Jose. We'll be back here tomorrow at 11:00 AM Eastern. Hopefully Kyle's back in action and we will go through another episode of Daily Rates Live. Thanks for joining us today and we'll see everybody tomorrow. Thank you everybody. Have a great day.