Troy-based United Wholesale Mortgage, a lender that underwrites and provides closing documentation for residential mortgage loans, today announced an interest-only financing program for qualified borrowers who use the company’s broker network.
“The purpose of the program is not to enable a consumer to afford a larger house; it’s for savvy borrowers who can regularly afford a house on a 30-year fixed mortgage, but choose the interest-only option to save additional discretionary income,” says Mat Ishbia, CEO of United Wholesale Mortgage.
Ishbia says the loans are available to borrowers with minimum credit scores of 720 and a 42 debt-to-income ratio. Borrowers must make a 20 percent down payment on the cost of a loan and will be required to begin paying down the principal of the loan after 10 years.
“We expect the program to be an incredibly popular option for well-informed borrowers, and in turn, a significant boom for mortgage originators,” Ishbia says.
He says the lender is making interest-only financing more mainstream by broadening its reach to mortgage brokers, small banks, and local credit unions throughout the country. Ishbia says large banking institutions typically offer the option, although the loans are mostly restricted to so-called jumbo borrowers, or those taking out mortgages worth more than $417,000.