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The New Penn HELOC Piggyback

Announcing the launch of our new HELOC Piggyback product.

New Penn is proud to announce the rollout of our new HELOC Piggyback product, furthering our commitment to bring forth new and inventive products to better meet the needs of our clients and borrowers. 

 

Some of the benefits of this product include:

  •  Provide options to increase borrowers’ buying power up to 95% CLTV.
  • Guide borrowers to avoid Jumbo and high balance pricing.
  • Help borrowers avoid MI costs.
  • Maximize borrowers’ cash out amount.
  • Save borrowers money by reducing their monthly payments.
  • Open doors to new broker and agent relationships.
  • Pair the HELOC with a wide variety of 1st mortgage products.  (Conventional DU/LPA, Jumbo Series F, I, J, Dream Big and High Balance Extra)

 

The HELOC will have these great features and product parameters:

Create the piggyback loan with the push of a button.  Borrower and subject property information is synched from the 1st to the 2nd.

  • Revolving line of credit with a 10-year draw period and a 20-year repayment period
    • Interest only payments during the 10-year draw period
  • A full draw is required at closing. 
  • Minimum line amount is $15,001.
  • $500k maximum loan amount
  • 95% maximum CLTV for purchase and rate/term refinance
  • 90% maximum CLTV for cash out refinance
  • 680 minimum FICO
  • No early closure penalty
  • Brokers may add a HELOC to an existing pipeline loan.
  • Qualifying payment is the fully amortizing payment based on the fully indexed rate (index + margin) plus 1% using the full line amount over a 20-yr amortization period.
  • The index is the Prime Rate.
  • The margin varies by credit score and CLTV.
  • Not available in Alaska, Hawaii, Louisiana, Tennessee, Texas, and Utah.

 

Additional Information for Brokers:

  • Brokers will be asked to provide documentation to show they have the appropriate license or state approval required to offer/broker HELOC loans for properties located in Colorado, Kansas, Michigan, Oregon and Wyoming
  • Brokers will not receive compensation for the HELOC
  • Brokers are required to provide the borrowers with following HELOC disclosures in their upfront disclosure package:
      • Important Terms of Your Home Equity Line of Credit, (this is the TILA disclosure for HELOCs)
      • What You Should Know About Home Equity Lines of Credit (Federally-mandated CFPB booklet)

 

For detailed product parameters and instructions, please refer to the HELOC Product Profile.

Learn more about the product and target borrowers at an upcoming training - click here to sign up.