Airbnb, a short-term rental service, announced today it is partnering with some of the largest U.S. lenders to allow host income to be used in mortgage applications.
The company partnered with Fannie Mae, Quicken Loans, Better Mortgage and Citizens Bank in its latest initiative to consider home-sharing as a tool for earning extra income when it comes to refinancing a home.
“At Airbnb, we’ve been able to help many reimagine the home as an asset, a destination, and a contributor to the community,” said Nathan Blecharczyk, Airbnb co-founder and chief strategy officer. “Today, some of the nation’s largest financial institutions understand that Airbnb is an economic empowerment tool that can generate important income for families, and they are working to recognize this.”
The company explained when its hosts apply for a refinance, they can include their proof of income from Airbnb in the application. The new partnership will allow lenders to consider Airbnb income when processing the application.
Many continue to question Airbnb, saying it could be disrupting the housing market. Many argue the prospect of being able to rent homes out as short-term rentals keeps homeowners from putting their home on the market.
However, under this new partnership, the housing industry would be working together with Airbnb to benefit homeowners looking to refinance their home.
The initiative was developed with Fannie Mae in order to identify new ways of utilizing home-sharing income and make it possible for homeowners to maximize their investment. The project is part of Fannie Mae’s work to find new, innovative ways to expand the availability of affordable mortgage credit.
Here’s what some of the lenders say about their new partnership:
“Technology is at the heart of everything we do at Quicken Loans, so it is a natural fit for us to partner with one of Silicon Valley’s most innovative companies,” Quicken Loans CEO Jay Farner said. “We are very excited to be collaborating with the leader in home-sharing and tech-driven property rentals.”
“Airbnb and Quicken Loans are firmly aligned to drive innovation in the real estate industry to dramatically improve and simplify client experience, as well as saving homeowners time and money,” Farner said.
And Better Mortgage CEO Vishal Garg commented:
“We are proud to be working with Airbnb and Fannie Mae to make it easier for Airbnb hosts to reinvest in their most important economic asset, their home,” Garg said. “Better can now digitally underwrite Airbnb income and offer hosts better home financing options than previously possible.”
“We believe this new product could allow hosts to capture substantial interest cost savings relative to a traditional mortgage,” he said.