In an effort to reach out to more clients, a national correspondent lender has enhanced its product line with government and conventional renovation financing and loans for manufactured homes.
Word of the new programs came Tuesday from First Guaranty Mortgage Corp.
While the company already had a correspondent channel in place, only 10 customers were set up as it established the operational flow, First Guaranty Senior Vice President Andrew Peters said in a written statement.
The McLean, Va.-based company said the new offering is a niche lending program dubbed “Correspondent’s Edge.”
According to First Guaranty, the new product line includes manufactured housing loans and rehabilitation loans like the Federal Housing Administration’s 203(k) program and Fannie Mae’s HomePath loan.
“Many of the correspondents we speak with have found themselves limited to fairly vanilla loans, limiting them to a fairly narrow range of potential borrowers,” Peters said in the news release. “Correspondent’s Edge should provide them with additional tools and offerings, and widen the market for many of the newer correspondents making the transition from third-party originator to correspondent lender.”
Peters estimates that the new initiative will account for a quarter of its upcoming business.
A settlement between First Guaranty and the Federal Housing Administration’s Mortgagee Review Board was announced in April by the Department of Housing and Urban Development. The settlement included a $127,500 civil money penalty, FHA reimbursements of more than $102,000 and borrower reimbursements of $7,900. HUD claimed that First Guaranty ignored bad credit, excessive debt-to-income ratios and improper broker fees on FHA loans.
In today’s announcement, Peters said that the lender’s expansion into non-traditional loans — which competitors have been avoiding as of late — is prudent given First Guaranty’s “cautious underwriting and an attention to detail.”
