Non-Conforming Mortgages

Non-conforming (or sub-prime) mortgages are home loans that are not regulated by the federal government. They came about as a result to help individuals with credit and debt problems. They are usually associated with higher interest rates and stricter conditions because your credit report doesn't reflect well on your financial strength.

Because homes are such big purchases, it becomes that much more important that you take care of your financial obligations. If you failed to pay several installments on a previous mortgage or credit cards on time, you're now seen as a borrower who is a bigger risk in the eyes of a lender. It used to be that this would completely disqualify you from owning a home, but since the non-conforming market has developed, that is no longer the case.

How does Indigo view these mortgages?

The way that our company approaches the non-conforming market is to view the mortgage as strictly a "band-aid" loan. That means that we want to help you get back on your feet and get into a home. After a few years of you keeping your finances in order, we'll get you back into a conforming mortgage that will have a lower interest rate. If we don't need to use a non-conforming mortgage to get you into a home, we're not going to even bother sending you in that direction because you have much better choices available to you.

It is important not to get seduced by the non-conforming mortgage that has the lowest interest rate. These programs usually also have expensive charges or pre-payment penalties at rates that end up being much, much higher than you should be paying. We do these loans as a service to our clients, not your detriment, and we only use these loans as a tool to do so.

Do Non-Conforming Mortgages work with
the Energy Efficient Mortgage?

No they do not. The Energy Efficient Mortgage is a conforming product that must be done within the guidelines set forth by Fannie Mae, the Federal Housing Administration, and Veteran's Administration. However, the Energy Efficient Mortgage can help lower the operating costs of the home by as much as 30% to 50%. Please refer to the menu on the left to learn more and see actual examples of the Energy Efficient Mortgage at work.