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UWM expands DSCR offerings to real estate investors

Depending on DSCR loan options, borrowers can finance as little as $50,000 or as much as $2 million depending on the monthly rental income

United Wholesale Mortgage (UWM), the country’s largest wholesale lender, expanded its debt service coverage ratio (DSCR) loan options to four after launching its first product in March.

Dubbed “Investors Flex,” the non-QM product for real estate investors, offered purchase and refinance loans up to $2 million that could be used to finance up to 20 properties by using each property’s monthly rental income to qualify.

With the expanded options, investors could get loans starting as little as $50,000 and up to $2 million. Depending on loan types, borrowers must have a minimum credit score of 620; up to 80% loan-to-value; and appraisals from two different appraisers required for loans that are more than $1.5 million.

“With these products, independent mortgage brokers will get greater transparency of investor guidelines and borrower qualifications – making it easier to choose the right product for borrowers,” the company said in a statement. 

Rising interest rates have slowed refi volume and lenders have been rolling out products that would help first-time buyers make home purchases affordable, in addition to its non-QM product expansion.

Early this month, UWM announced home-affordability mortgage products designed to help underserved borrowers become homeowners.

UWM started offering Fannie Mae‘s Special Purpose Credit Program (SPCP) through HomeReady as well as Freddie Mac’s BorrowSmart Geo-Target program in select metro areas.

Qualified buyers receive up to $10,000 toward their downpayment/closing costs with BorrowSmart Geo-Target, or $5,000 toward their downpayment/closing costs and up to $1,000 toward home warranty and appraisal costs with the HomeReady SPCP.

Other initiatives to bring in origination volume by the Michigan-headquartered wholesale lender include the addition of bank statement loan offerings for self-employed borrowers and the resumption of its conventional 1% down loan option.

UWM originated $38.8 billion in mortgage loans in the first quarter of 2022, a 29.7% decrease compared to the previous quarter but a 20.8% decline year-over-year. 

The lender had forecast decreased production volume of between $26 billion and $33 billion for Q2. UWM is expected to report its second-quarter earnings in the coming weeks. 

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