Donald Salmon of TBI Mortgage says private investors are beginning to buy mortgages written just for self-employed borrowers who put down 30 percent and have good credit scores. Instead of looking at paychecks, they examine a twelve-month bank statement to determine if the borrower can afford the home, nationalmortgagenews.com reports. “These types of loans made to high-net-worth borrowers with excellent credit, significant equity in the property, and substantial reserves is not new, but has been limited,” according to Michele Patterson of Kroll Bond Rating Agency.

On the other hand, Larry Sorsby of Hovnanian Enterprises decries the drop in Federal Housing Administration (FHA) loans due to increases in mortgage insurance costs, especially since the Great Recession. The first nine months of the government’s fiscal year, which ended June 30, saw originations of 566,500 FHA-backed loans, a drop of 47 percent from the same period of 2013. Says Sorsby: “Borrowers have switched away from FHA loans to more affordable Fannie Mae and Freddie Mac loans.” As Daily Business News posted Aug. 29, 2014, the Freddie Mac manufactured housing community finance program was inaugurated by Walker & Dunlop: $10.5 million for Longhaven Estates MHC in Arizona. ##

(Image credit: top left, andyenstallblog.com; bottom, globest.com–Freddie Mac headquarters)