LoanStream Mortgage, the “ONE” Lender headquartered in California, has revealed market-leading loan-to-value ratios for customers seeking DSCR-type loans.
According to William Fisher, executive vice president of non-QM and jumbo, the firm now offers up to 85 percent LTV ratios, which is much higher than the 80 percent provided by rivals.
“Our upgrades to our DSCR continue to maintain us in a leading position in the non-QM sector, with continuous innovations,” Fisher added.
The leading third-party originator, whose footprint has tripled, now provides more than 70 distinct home loan products in 38 states, driven by its patented NanQ (non-prime) programs.
LoanStream’s newest offering comes on the heels of the business increasing its DSCR loan limits from $3.5 million to $5 million.
Because they relate to investment, non-owner-occupied homes, DSCR loans entail some inherent risk. However, after agency lenders Fannie Mae and Freddie Mac announced a rule change on these types of investments, LoanStream decided to fill the void by increasing LTVs to 85 percent on DSCR and offering its proprietary AltONE Investment property loan, which follows DU findings and allows loan amounts of up to $1,500,000.
According to Fisher, the choice was not difficult to make since the economy was booming in the aftermath of the epidemic, creating new commercial possibilities.
“We’re very confident in the performance of our loans, the hunger of the secondary market, and the quality of our borrowers,” LoanStream Mortgage President Serene Vernon said. “Not only are we moving up to the 85 percent, but we’re also going to an 80 percent loan to value for what we term no ratio DSCR, which is when the borrower does not present us with a rental agreement for that property. This puts us miles ahead of the competition.”
When asked why LoanStream chose to launch the program now, he said it was “a great moment,” citing the increase in property prices and the excellent quality of the company’s customers.
He said, “We’re also seeing certain Wall Street companies going into the non-owner or property-owning sector themselves, which lends credibility to our viewpoint.”
He said that, with its increased $5,000,000 loan maximum, LoanStream was simply fulfilling the requirements of borrowers, particularly those in coastal areas with greater property prices, such as California, New Jersey, and South Florida.
The typical customer profile is a person who owns a main home and want to diversify their portfolio by investing in real estate rather than more conventional equities and bonds.
LoanStream is fulfilling the requirements of borrowers, some of whom are first-time or novice investors, by reducing the hurdles to entry for individuals with the money to put down on homes, according to Fisher.
“We have established new criteria surrounding the DSCR program that assist our borrowers become more financially prepared to guarantee we have a good performing loan,” he said.
