Source: Housing Wire —
As you probably know by now, the Federal Housing and Finance Agency has limited GSEs to a 7% cap on loan purchases for second home and investment properties. This means that lenders who sell these types of loans to Fannie Mae and Freddie Mac will be subject to restrictions if their volume exceeds 7%.
How does this impact originators? It could pose a real challenge. Real estate investors see a significant opportunity in the single-family rental space. Due to tight inventory and increased competition, investors need to close on loans quickly. They need a go-to lender who can get it done. This is a new environment of managing specific loan volume within the overall agency production, now and going forward. The options for originators and their real estate investor clients get smaller trying to find someone to do these loans. Along with the cap, guidelines are tightening for these loans, making alternative loan solutions––such as non-QM––a must-have loan offering outside of Agency.