Newrez gives non-QM borrowers "more affordable option"

The company launches a 40-year fixed-rate option for non-QM loans

Newrez gives non-QM borrowers "more affordable option"

Newrez, a mortgage lending and servicing company focused on non-QM, has launched a 40-year fixed-rate interest-only (IO) option designed to boost homebuyers’ purchasing power.

As part of its Smart Series non-QM line-up, the new product offers a 40-year loan term with interest-only payments for the first 10 years. Newrez said the longer loan term option allows borrowers and investors priced out of today’s housing market to have more affordable monthly payments.

The 40-year IO option applies to all Smart Series non-QM products and is available across the company’s lending channels, including retail, wholesale, correspondent, joint venture, and direct-to-consumer.

“We are continually enhancing and updating our Smart Series products to ensure we are providing competitive non-QM financing options for our clients in current market conditions,” said Jeff Gravelle, co-head of production at Newrez. “Our Smart Series products, like the 40-year IO, are developed to meet the needs of today’s borrowers and open the door to thousands of prospective homeowners.”

Rithm Capital – the parent company of Newrez – reported a $3.3 million loss in its second quarter financial report. Despite the loss, the firm celebrated a few milestones, including the growth of its non-prime mortgage and single-family portfolios.

Read next: Rithm Capital posts multi-million-dollar loss in second quarter

“The business continues to benefit from our large portfolio of MSRs, our balanced approach to origination and servicing, and our diverse portfolio of operating companies and assets,” said Michael Nierenberg, chairman, CEO, and president of Rithm Capital. “With $1.8 billion of cash and liquidity, we are in a great position to make investments at attractive yields in a financial services market searching for liquidity.”