The nation’s largest wholesale lender, United Wholesale Mortgage (UWM), introduced a new product on Wednesday, the 23rd of March, that will qualify borrowers for investment properties based on monthly rental revenue rather than current income. This is the second non-QM product introduced by the Pontiac-based lender this month; the wholesale lender recently announced a bank statement loan for self-employed applicants.

Rising interest rates, which are now in the mid-4% area, have slowed refinancing substantially, prompting lenders to look for alternate solutions to entice prospective buyers or those with equity in their current homes. The product Investor Flex is a 30-year fixed Debt-Service Coverage Ratio (DSCR) credit option for real estate investors, according to UWM. It can be used to finance up to 20 properties and is available on buy and refinance loans up to $2 million.

The new offering is aimed toward real estate investors, who accounted for 16.4% of all house sales in the third quarter of 2021, according to RealtyTrac’s Investor Purchase Report. According to the company, it will also be available for short-term rental properties, providing brokers with another competitive selling advantage when pursuing real estate investors. Rising housing prices and inflation make it difficult for investors to meet their return on investment (ROI) goals. Still, according to Rick Sharga, executive vice president of RealtyTrac, they make it even more difficult for the typical consumer to buy a home. “So, even if investor profit margins may be dropping, the investor portion of purchases may continue to rise over the next few quarters,” he said. To read more on this, click here.

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