TD Bank is offering a new mortgage loan product alternative to FHA loans.
While there are some features of the product that may remind people of subprime mortgages, the bank stressed its “conservative approach to lending” differentiates their product from the overly flexible loans others made a few years ago.
TD Bank’s "Right Step" mortgage product is designed for homebuyers who make up to 80% of the median area income as determined by the Department of Housing and Urban Development to buyers in the bank’s Maine to Florida footprint.
The bank calls its “Right Step” loan “an alternative to Federal Housing Administration-backed loan products” for homebuyers who need flexible downpayment options to become homeowners.
It offers simplified underwriting and appraisal processes and the potential savings on mortgage insurance, and the convenience of 24/7 access to lending professionals.
Michael Copley, the bank’s EVP of retail lending, said the goal is to provide multiple options for “a diverse array of borrowers.”
TD Bank, one of the 10 largest banks in the U.S. serving nearly 8 million customers nationwide, also pledges to provide competitive rates on various mortgages including jumbo, adjustable-rate and FHA loans.