Alt-AUS Loans FAQ

No SSN required. Takes about 2 minutes.

What is an Alt-AUS loan?

Alt-AUS (short for Alternative AUS Solution) is a jumbo loan program that follows Fannie Mae Desktop Underwriter findings with a small set of lender overlays plus some non-QM options. It bridges the gap between standard conforming conventional and full non-QM jumbo. Loan amounts $300,000 to $3 million. 20, 25, or 30 year fixed rates only. The fastest jumbo approval path for borrowers with clean W-2 income who need a loan above the conforming limit.

What does AUS mean?

AUS stands for Automated Underwriting System. Instead of an underwriter reading your file from scratch, your loan runs through software that scores it against thousands of rules in seconds. The two main agency AUS engines are Fannie Mae’s Desktop Underwriter (DU) and Freddie Mac’s Loan Product Advisor (LPA). Alt-AUS follows DU findings specifically.

Who should consider an Alt-AUS loan?

Borrowers with W-2 income above the conforming limit who want the cleanest, fastest jumbo approval. Specifically: high earners with strong credit and clean documentation; borrowers near the 45-50% DTI line who can’t fit other jumbo programs at 43% DTI; and buyers who want a fixed-rate jumbo without prepayment penalty. Not the right fit for self-employed borrowers with write-offs (route to bank statement) or for ARM/interest-only seekers (route to the IO Jumbo program).

Is Alt-AUS the same thing as “AUS Jumbo”?

Yes — same product, different name. The Jumbo product family on our site profiles eight distinct jumbo programs; the AUS-Driven Jumbo program profiled there is this Alt-AUS Solution. We use “Alt-AUS” as the shorthand because that’s the program name on the matrix.

Is Alt-AUS a non-QM loan?

Sort of. It follows DU findings (agency-style underwriting) but adds some non-QM options, which is why the name includes “Alternative.” It IS QM Safe Harbor compliant — meaning it meets the CFPB Qualified Mortgage rules and gives borrowers full Ability-to-Repay protections. It prices as Jumbo in the pricing engine, not as a true non-QM. Most borrowers think of it as “agency-plus” — agency underwriting standards stretched to jumbo loan amounts.

Does Fannie Mae’s Day 1 Certainty apply on Alt-AUS?

No. Day 1 Certainty options are not allowed on Alt-AUS. Income, employment, and assets must be verified through standard documentation rather than DU’s representation and warranty relief.

What’s the minimum loan amount on Alt-AUS?

$300,000. Below that, you’d route to a conforming conventional loan instead. Alt-AUS pricing is set up for jumbo loan amounts, so the floor exists to keep economics aligned with the product design.

What’s the maximum loan amount on Alt-AUS?

$3 million on owner-occupied 1-unit purchase or rate/term refinance at 60% LTV with 740 credit. $2.5 million at 65% LTV with 720 credit. $2 million at 70-75% LTV with 680 credit. The maximum drops on cash-out and non-owner-occupied transactions. First-time homebuyers cap at $1.5 million regardless of other factors.

What’s the maximum LTV on Alt-AUS purchase?

80% LTV up to $1.5 million on owner-occupied 1-2 unit (661+ credit). 80% LTV up to $1.5 million on second homes 1-unit (680+ credit). 75% LTV up to $2 million on owner-occupied 1-2 unit (680+ credit). 75% LTV up to $1.5 million on non-owner-occupied 1-unit (680+ credit). 70% LTV up to $2 million on owner-occupied 1-4 unit. 65% LTV up to $2.5 million on owner-occupied 1-unit (720+ credit). 60% LTV up to $3 million on owner-occupied 1-unit (740+ credit).

What’s the maximum LTV on Alt-AUS cash-out?

80% LTV up to $1 million on owner-occupied 1-unit (680+ credit). 75% LTV up to $1.5 million on owner-occupied 1-2 unit (680+ credit). 70% LTV up to $1 million on second home 1-unit (680+ credit). 65% LTV up to $1.5 million on second home 1-unit (680+ credit). 60% LTV up to $2 million on owner-occupied 1-4 unit (680+ credit). 60% LTV up to $1.5 million on non-owner-occupied 1-4 unit (requires 700+ credit).

Is there a separate CLTV cap?

CLTV matches the LTV cap at every tier. There’s no second-mortgage subordinated layering above the LTV cap on Alt-AUS — if your CLTV would exceed the program’s LTV cap with a second mortgage, the deal doesn’t fit.

How does the appraised value work on refinance?

If you’ve owned the property more than 12 months, LTV is calculated on the current appraised value. If you’ve owned it less than 12 months, LTV is calculated on the lesser of the original purchase price (plus documented improvements made after purchase with receipts) or the current appraised value. The 12-month timeframe is based on the new loan’s Note date.

Are two appraisals required on Alt-AUS?

Two appraisals may be required at higher loan amounts (typically above $2 million depending on program tier). When two appraisals are required: both must be completed by independent companies, and the LTV is determined by the lower of the two appraised values when the lower value supports the transaction. Both reports must reconcile any discrepancies. Properties in ongoing disaster areas are not eligible regardless of when the appraisal was completed.

No SSN required. Takes about 2 minutes.

What’s the minimum credit score for an Alt-AUS loan?

661 minimum on the most flexible tier (purchase or rate/term refinance, owner-occupied 1-2 unit, up to $1.5M at 80% LTV). Most tiers require 680. Higher loan amounts and cash-out non-owner-occupied transactions require 700+. The highest tiers ($2.5M and $3M) require 720 and 740 respectively. Self-employed borrowers using SE income for qualifying need 720 minimum regardless of other factors.

How is credit score calculated for Alt-AUS?

Standard Fannie Mae methodology. Tri-merge credit report. The middle score of three (or the lower of two if only two are reported) is the representative score for each borrower. On joint applications, the lowest representative score among all borrowers is used.

Does credit score floor change with DTI?

Yes. If your DTI exceeds 45%, you need at least 700 credit and 6 months of reserves regardless of the LTV/loan amount tier. So a $1.5M loan at 80% LTV (where the standard floor is 661) bumps to 700+ if your DTI is 47%.

Is there a credit score bump for self-employed?

Yes. Self-employment income required for qualifying triggers a 720 minimum credit score, regardless of the LTV/loan amount tier. If SE income is NOT needed (e.g., a spouse’s W-2 income alone qualifies the loan), the 720 minimum does not apply — standard tier credit floors govern.

What if my credit score is below 661?

Alt-AUS doesn’t work. You’d route to a different jumbo program or a non-QM jumbo path with lower credit floors. Or, if your loan amount allows, FHA may be the right route (FHA goes down to 500 credit at 10% down).

Does Alt-AUS use a credit score or a credit story?

Both. The credit score determines tier eligibility. The credit story (history of timely payments, recent collections, credit utilization, etc.) is evaluated by DU as part of its automated decision. DU may approve a 720-credit file with a recent late or condition a 700-credit file with strong overall depth. The score is one input among many.

What’s the DTI limit on Alt-AUS?

49.99% maximum DTI. But DTI above 45% requires a minimum 700 credit score AND six months of reserves. Below 45% DTI, standard tier credit floors apply. The 49.99% cap is significantly higher than the 43% standard on most other jumbo programs — one of the strongest reasons to use Alt-AUS.

What documentation does Alt-AUS require?

Full documentation. W-2 transcripts via a Fannie Mae-approved third-party vendor (typically The Work Number) with separation of income types — base, bonus, overtime, etc. Tax returns when DU requires them. IRS tax transcripts when tax returns are used. NO bank statement, 1099, P&L, or asset depletion paths available on this program.

How many years of income are documented?

Based on DU findings. Typically 2 years of W-2 transcripts and tax returns when needed. DU may reduce documentation requirements based on the file’s overall strength (high credit, low LTV, strong reserves) — but for jumbo amounts, expect 2 full years.

Is manual verification of employment allowed?

No. Manual verification of employment is NOT permitted on Alt-AUS. Employment must be verified through the Fannie Mae-approved third-party vendor (The Work Number or equivalent). This is a firm requirement — borrowers whose employers don’t report to those vendors will have qualification difficulty on this program.

What about IRS tax transcripts?

IRS tax transcripts are required for any borrower whose tax returns are used to document income or losses. Transcripts must be obtained directly from the IRS via a third party. They must match the documentation in the loan file. If the IRS rejects the transcript request with a Code 10 identity-theft indicator, borrower-obtained online transcripts may be used as a backup.

Can I qualify with bonus or commission income?

Yes. Bonus, overtime, and commission income is allowed when documented through the third-party vendor with separation of income types. DU findings determine how the income is averaged (typically 24-month averaging for variable income components). Strong, consistent history strengthens the qualifying calculation.

Can I qualify with self-employment income on Alt-AUS?

Yes — with 720 minimum credit score and full tax-return documentation. Two years of personal AND business tax returns required. IRS transcripts required. The 720 minimum applies regardless of LTV tier when SE income is needed to qualify. If your tax returns understate income due to write-offs, the bank statement or P&L non-QM jumbo paths are typically better routes than Alt-AUS.

What’s the minimum down payment on Alt-AUS?

20% down (80% LTV) is the minimum on owner-occupied 1-2 unit purchase up to $1.5M with 661+ credit. Most tiers require 25% down or more. Higher loan amounts require larger down payments — 35% down for the $3M tier. There’s no 10% down option on Alt-AUS (for that, the 10% Down Jumbo program is the path).

Can I use gift funds for the down payment?

Yes — but the borrower must contribute 5% of their own funds first. Gift funds are not permitted to count toward reserves. At LTVs above 80%, gift funds are not permitted at all (so on Alt-AUS, the LTV cap is 80% on the most flexible tier, which means most files can use gifts after the 5% own-funds contribution).

Are business funds eligible for down payment?

Yes, business funds can be used for down payment with proper sourcing, but they are not permitted to be counted as reserves. Moving business funds into a personal account doesn’t convert them — they remain sourced and treated as business funds even after transfer. The funds must be from a business in which the borrower has a documented majority ownership stake.

What seller concessions are allowed?

Follow Fannie Mae Selling Guide requirements. Typically 3-9% of purchase price depending on occupancy and LTV, with closing costs the primary use. Seller concessions cannot reduce the borrower’s required minimum contribution.

Can the seller pay for a permanent rate buydown?

Yes. Permanent rate buydowns (discount points) paid by the seller are allowed within the standard seller concession cap. Temporary buydowns (1-0, 2-1, 3-2-1) are NOT allowed on Alt-AUS — that’s the key distinction.

How many months of reserves does Alt-AUS require?

Based on DU findings, which typically scale with loan amount, LTV, and occupancy. DTI above 45% triggers a minimum 6 months reserve requirement regardless of what DU calls for. Larger loan amounts and non-owner-occupied transactions typically require more reserves than smaller owner-occupied loans.

What counts as reserves?

Cash in checking and savings (100%). Money market accounts (100%). Brokerage accounts holding stocks, bonds, mutual funds (typically 70-80% of value to account for market risk). Retirement accounts (typically 60-70% of value to account for penalty/tax on early withdrawal — but only if the borrower has access without termination of employment).

Can gift funds count as reserves?

No. Gift funds are explicitly not permitted to be counted as reserves. Reserves must come from the borrower’s own funds (or sourced/seasoned business funds for some scenarios, though business funds are also not permitted as reserves on Alt-AUS specifically).

Are reserves required for each financed property I own?

Yes. All financed 1-4 unit residential properties require an additional six months of reserves per property unless specific exclusions apply. Own 3 other homes besides the subject? That’s 18 additional months on top of the program’s base reserve requirement.

What’s the reserve trigger for high-DTI files?

6 months minimum reserves when DTI exceeds 45%. This is in addition to the standard reserve requirement per DU findings — the higher number wins. A file with DTI 47% and DU calling for 4 months reserves would still need 6 months (the higher of 4 vs the 6-month DTI trigger).

No SSN required. Takes about 2 minutes.

What occupancy types are eligible on Alt-AUS?

Owner-occupied primary residence, second home, and non-owner-occupied investment property are all eligible — at different LTV and loan amount caps. Owner-occupied gets the most flexible terms. Non-owner-occupied caps lower on both LTV and loan amount.

What property types qualify?

1-4 unit single family residences (attached and detached). Condominiums — both Fannie Mae warrantable and non-warrantable (with LTV adjustment). Modular homes. Planned Unit Developments (PUDs). Properties with 40 acres or less. Florida new construction (full review or PERS permitted). Properties subject to existing leases with proper documentation.

What property types are NOT eligible?

Hawaii properties in lava zones 1 and 2. Hawaii Homeland Leasehold properties. Leaseholds generally. Mobile homes. Manufactured homes. Co-ops. Log homes. Earth houses. Houseboats. Geodesic domes. Working farms, ranches, orchards, or any commercial operations. Properties with income-producing attributes. Commercial enterprises (B&Bs, boarding houses, hotels). Land trusts (except Illinois Land Trust). Properties in active litigation. Life estates. Properties held in business names. Properties in Community Development Districts (CDDs). Properties with C5, C6, or Q6 condition/quality ratings. Properties with hauled water. Properties with PACE/HERO loans attached.

Are 2-4 unit properties allowed?

Yes. 2-unit owner-occupied gets the same tier treatment as 1-unit on most loan amount/LTV combinations. 3-4 unit owner-occupied is allowed up to 70% LTV at $2 million with 680 credit. On cash-out, 3-4 unit owner-occupied is allowed up to 60% LTV at $2 million.

Can I use Alt-AUS for an investment property?

Yes — non-owner-occupied 1-unit purchase or rate/term up to $1.5M at 75% LTV with 680 credit. Non-owner-occupied 1-4 unit cash-out up to $1.5M at 60% LTV with 700 credit. For DSCR-style qualifying (using rental income rather than personal income), DSCR Loans is the better product — Alt-AUS still requires personal income qualification under DU.

What about second homes?

Eligible. Second home purchase or rate/term up to $1.5M at 80% LTV (1-unit, 680+ credit) or up to $2M at 65% LTV (1-unit, 680+ credit). Second home cash-out up to $1M at 70% LTV (1-unit, 680+ credit) or up to $1.5M at 65% LTV (1-unit, 680+ credit). Standard second home rules apply (distance from primary, intended use, etc.).

Are properties with acreage allowed?

Yes — up to 40 acres. Beyond 40 acres, the property typically falls into the “working farm” category which is ineligible. Properties between 10-40 acres with no income-producing attributes are generally fine. Properties with significant outbuildings, agricultural use, or commercial activity get scrutinized closely and may be ineligible.

Are properties in flood zones eligible?

Yes, with standard flood insurance requirements. Flood insurance is required on any property where the structure is in a Special Flood Hazard Area (FEMA-designated). Coverage must equal the lesser of the loan balance, the maximum NFIP coverage available, or replacement cost of the improvements.

What’s the first-time buyer loan amount cap?

$1,500,000 maximum loan amount for first-time homebuyers on Alt-AUS, regardless of credit, LTV, or other qualifying factors. Above $1.5M, first-time buyers route to a different jumbo program (such as the 10% Down Jumbo or AUS-Driven Jumbo with appropriate adjustments).

Who counts as a “first-time homebuyer”?

Standard Fannie Mae definition: someone who hasn’t owned a principal residence within the past 3 years. If you owned a home 4+ years ago and have rented since, you’re not a first-time buyer. If both borrowers on the application are first-time buyers, the $1.5M cap applies; if one borrower has prior ownership within 3 years, the cap doesn’t apply.

Do first-time buyers need a homebuyer education course?

Not required on Alt-AUS. Homebuyer education is required on certain low-down-payment conforming products (HomeReady, Home Possible) but isn’t part of Alt-AUS requirements at any tier. We still recommend the course as a learning experience but it’s not a qualifying condition.

Who is eligible to borrow on Alt-AUS?

US Citizens. Permanent Resident Aliens. Non-Permanent Resident Aliens with valid Social Security Numbers. Illinois Land Trust holders (Illinois only). Inter Vivos Revocable Trusts (with specific documentation). Non-Occupant Borrowers who are related family members. Maximum 5 borrowers per loan. All borrowers must have valid Social Security Numbers.

Who is NOT eligible?

Foreign Nationals. Borrowers with Diplomatic Immunity status. Life Estates. Non-Revocable Trusts. Guardianships. LLCs, Corporations, or Partnerships (entity title not allowed). Land Trusts (except Illinois Land Trust). Borrowers with any ownership in a business that is federally illegal — even if that income isn’t being used for qualifying.

Can the property be titled in an LLC?

No. Alt-AUS doesn’t allow LLC, corporation, or partnership ownership. If the property is currently in an LLC, the borrower would need to take title in their personal name(s) at closing. For LLC-titled investment properties, DSCR Loans is the right product instead.

Can I add a non-occupant co-borrower?

Yes — but only a related family member of the borrower(s). The non-occupant co-borrower must have a valid Social Security Number. Standard Fannie Mae non-occupant co-borrower qualifying rules apply (their income, credit, and debts all factor into the qualification calculation).

Are Non-Permanent Resident Aliens really eligible?

Yes — but with specific documentation requirements around valid SSN, current immigration status documentation, and continuance of employment authorization. The qualification standards are the same as for US citizens once eligibility is established. Foreign nationals (no SSN, non-resident) are different and NOT eligible on Alt-AUS.

Can I refinance into Alt-AUS?

Yes. Both rate/term refinance (limited cash-out) and cash-out refinance are eligible. The LTV cap differs between the two — rate/term goes higher than cash-out at every tier. Standard refinance qualifying applies.

What’s the cash-out maximum on Alt-AUS?

Maximum cash-out loan amount: $1M at 80% LTV (1-unit owner-occupied), $1.5M at 75% LTV (1-2 unit owner-occupied), $2M at 60% LTV (1-4 unit owner-occupied), $1M-$1.5M for second homes, and $1.5M at 60% LTV for non-owner-occupied 1-4 unit (requires 700+ credit). Maximum cash-back to borrower follows DU findings within the LTV cap.

Is Texas Section 50(a)(6) cash-out allowed on Alt-AUS?

Check program-specific allowances. Some jumbo programs explicitly prohibit Texas Section 50(a)(6), others allow it with conditions. Texas home equity cash-out has specific state law requirements that change the structure of the transaction. Confirm with intake if you’re in Texas.

Can I do a streamline refinance on Alt-AUS?

No streamline refinance program exists for Alt-AUS. Full underwriting is required on every refinance — full doc, DU run, full appraisal (unless the file qualifies for an alternative collateral evaluation tool). VA IRRRL and FHA Streamline are specific to those government programs, not Alt-AUS.

When does it make sense to refinance INTO Alt-AUS from another program?

Common scenarios: (1) Refinancing from a non-QM jumbo into Alt-AUS after building two years of clean W-2 income that supports full-doc qualifying — typically lower rate, no prepay penalty. (2) Refinancing from an ARM or interest-only jumbo into Alt-AUS fixed-rate to lock long-term rate stability. (3) Refinancing from FHA to Alt-AUS to drop MIP once equity allows the jumbo LTV.

What loan terms are available?

20-year fixed, 25-year fixed, and 30-year fixed. That’s it. No 15-year fixed on Alt-AUS specifically (some other jumbo programs offer 15-year). No ARMs. No interest-only. No balloon payments. The pure fixed-rate amortizing nature is part of the product positioning — predictability for the long haul.

Can I get an interest-only or ARM Alt-AUS loan?

No. Alt-AUS is fixed-rate only. If you need IO or ARM features on a jumbo loan, you’d route to the Interest-Only Jumbo program (offers IO up to $5M with 5/6, 7/6, 10/6 SOFR ARMs).

Does Alt-AUS have a prepayment penalty?

No. Pre-payment penalties are NOT allowed on Alt-AUS loans. You can pay off the loan at any time without penalty — sell, refinance, or make extra principal payments. This is a meaningful consumer advantage versus full non-QM jumbo programs, which often carry prepayment penalties on investment properties.

Are temporary buydowns allowed?

No. Temporary buydowns (1-0, 2-1, 3-2-1) are NOT allowed on Alt-AUS. If a temporary buydown is essential, the seller credit or builder credit must be applied as a permanent rate buydown (discount points) or general closing cost credit instead.

Is loan recast allowed on Alt-AUS?

Yes. Loan recast (also called re-amortization) is allowed. After making a large principal paydown, you can request the servicer recalculate your monthly payment based on the new lower balance — same rate, same term, lower monthly payment. Typically a small administrative fee. Useful when borrowers come into a lump sum (sale of prior home, inheritance, bonus) and want to reduce monthly payment without refinancing.

Can I use Alt-AUS for a non-warrantable condo?

Yes, but with LTV restrictions. LTV/CLTV must be 10% below the standard program maximum, up to a maximum 70% LTV/CLTV. So a tier that normally allows 80% LTV would cap at 70% on a non-warrantable condo. The condo project still needs full condo review and may need additional Non-QM team review.

What makes a condo “non-warrantable”?

Falls outside Fannie Mae’s warrantability rules. Common reasons: too many short-term rentals in the project, too high a percentage of investor-owned units, ongoing litigation affecting the HOA or developer, inadequate insurance, owner-occupancy ratio below 50%, or a single entity owning more than 20% of the project. The condo HOA’s condo questionnaire response determines warrantability.

Are condotels allowed on Alt-AUS?

Yes, on a case-by-case basis. The condo project must be submitted to the Non-QM team for acceptability in addition to the standard condo review. Condotels are manually priced and locked by PRMG’s Secondary team rather than the standard pricing engine — meaning pricing isn’t quoted instantly and takes a few business days to confirm. Same 10% below max LTV with 70% cap applies.

What’s a condotel vs a regular condo?

A condotel is a condominium project that operates partly like a hotel — typical features include short-term rentals managed by an on-site front desk, room cleaning services, restaurant or amenities open to non-residents, and a strong tenant mix of vacation visitors rather than full-time owners. Common in resort areas (beach, ski, urban downtown). Many lenders refuse condotels entirely; Alt-AUS allows them with the additional review path.

Alt-AUS vs Conventional Conforming

Below $832,750 (or $1,249,125 in high-cost counties), conventional conforming is the better choice — easier underwriting, lower rates, easier qualifying. Above those limits, Alt-AUS is one of the options. The Alt-AUS sweet spot is loan amounts between the conforming limit and $3M.

Alt-AUS vs Standard Jumbo

Alt-AUS is itself one of the 8 jumbo programs. Versus other jumbo programs: Alt-AUS allows up to 49.99% DTI (most jumbo caps at 43%). Alt-AUS uses DU findings (some other jumbo programs use manual underwriting or different AUS engines). Alt-AUS is fixed-rate only (other jumbo programs offer ARMs and IO). Alt-AUS has no prepay penalty (matches other conventional jumbo). Alt-AUS is full-doc only (no bank statement, 1099, or asset depletion paths available within Alt-AUS).

Alt-AUS vs Non-QM Jumbo

Alt-AUS is full-doc only. Non-QM jumbo uses bank statements, 1099s, P&L statements, or assets. Alt-AUS pricing typically beats non-QM jumbo for clean W-2 files. Alt-AUS has no prepay penalty; some non-QM jumbo paths carry prepay on investment properties. If your tax returns clearly support qualifying income at 49.99% DTI or less, Alt-AUS wins. If write-offs reduce qualifying income or you need higher DTI than 50%, non-QM jumbo takes over.

Alt-AUS vs 10% Down Jumbo

Different positioning. 10% Down Jumbo allows 89.99% LTV up to $2M. Alt-AUS caps at 80% LTV on the most flexible tier. If you need higher LTV than 80%, route to 10% Down Jumbo. If you need higher DTI than 43% (Alt-AUS allows 49.99%), Alt-AUS wins. Often the choice is which constraint matters more in your scenario.

Alt-AUS vs VA Jumbo

If you’re VA-eligible with remaining entitlement, VA Jumbo wins almost every time. No down payment with full entitlement. Lower rate than conventional jumbo. No PMI required. The VA funding fee applies (reduced for VA disability, waived for 100% disabled veterans). Alt-AUS would only beat VA Jumbo in unusual scenarios — e.g., no remaining VA entitlement and substantial down payment available.

What’s the waiting period after bankruptcy?

Follows Fannie Mae standards via DU findings. Chapter 7 typically requires 4 years from discharge date (2 years with documented extenuating circumstances). Chapter 13 typically requires 2 years from discharge or 4 years from dismissal. Open bankruptcies are NOT eligible — the bankruptcy must be fully discharged or dismissed before the file can clear DU.

What’s the waiting period after foreclosure or short sale?

Follows Fannie Mae standards. Foreclosure typically requires 7 years from completion (3 years with documented extenuating circumstances). Short sale typically requires 4 years (2 years with documented extenuating circumstances). Properties currently in the foreclosure redemption period are not eligible until the redemption period has expired AND the foreclosure sale has been confirmed AND clear and marketable title can be obtained.

Are open collections OK?

Follows DU findings. Open collections typically need to be paid off prior to or at closing, or the file may require additional documentation explaining the collection. Medical collections may be treated differently than non-medical collections under current DU logic. Recent collections (within 24 months) get more scrutiny than older ones.

What’s the application process for Alt-AUS?

Start with the 2-minute intake form (no SSN, no hard credit pull). We confirm Alt-AUS is the right program for your scenario, then move to formal application: credit pull, full document collection, DU run, appraisal ordered, underwriting review. From intake to clear-to-close is typically 25-35 days depending on appraisal and document turn times. Closing is standard.

How long does Alt-AUS typically take to close?

25-35 days from application to close for clean files. The DU-driven nature shortens underwriting compared to manual jumbo programs. Two-appraisal loans (typically above $2M) add time. Files with documentation gaps, condotel reviews, or special property types take longer.

What documents will I need to provide?

Standard full-doc package: 2 years W-2s, 2 years federal tax returns (personal and business if self-employed), 30 days recent pay stubs, 60 days asset statements (more for reserves verification), photo ID, divorce decree if applicable, current lease agreements on other properties. We also need permission to verify employment through The Work Number and to pull IRS tax transcripts.

When do I lock my rate?

Typically after underwriting issues conditional approval, when we have confidence in closing timeline. Standard lock periods are 30, 45, or 60 days. Condotels require manual lock by PRMG’s Secondary team, which takes additional time to confirm pricing before locking.

What happens after closing?

Standard mortgage servicing. The loan is typically transferred to a long-term servicer within 30-60 days of closing — you’ll get a notice explaining where to send payments. Loan recast is available if you make large principal paydowns and want monthly payment recalculated. Refinance to drop rate (if rates fall) requires full re-underwriting since there’s no streamline refinance on Alt-AUS.

No SSN required. Takes about 2 minutes.

About this guide: Compiled by J.D. Peck, NMLS #314883, Area Manager and Mortgage Loan Originator at Paramount Residential Mortgage Group (PRMG), NMLS #75243. 25+ years of mortgage lending experience, 3,100+ loans closed, Scotsman Guide Top Originator 2026. Rules above are from the PRMG Alternative AUS Solution product profile dated 02/12/2026. Guidelines, fees, and limits are subject to change. Lending in 49 states. New York excluded. Last updated June 6, 2026.