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Tap Into A Growing Market Share Of Underserved Borrowers With Newrez's Smart Series

National Mortgage Professional
Jun 23, 2022
home sold

Introducing… Newrez’s Smart Series loans, including SmartSelf, SmartVest, and SmartEdge.


“As of 2021, there are at least 59 million gig work employees in the U.S,” according to statistics collated by Zippia.

While that number may seem insignificant, it’s deceiving; those 59 million gig workers make up a third of the entire U.S. workforce. The way we work is changing, as well as the way we live – and we, as part of the housing process, must stay up to date.

Introducing… Newrez’s Smart Series loans, including SmartSelf, SmartVest, and SmartEdge.

With non-qualified mortgages, and particularly Smart Series, borrowers have access to financing solutions that could make more sense for their finances – they are the response to our changing environment when it comes to helping clients purchase homes and properties.


So, what kinds of borrowers could benefit from Smart Series?

  • Self-employed borrowers.
  • Freelancers, gig economy workers.
  • Real estate investors.
  • Borrowers with high net worth.
  • Commission-based homebuyers.
  • Business owners.
  • Homebuyers with investments, trust funds, large assets, or low reportable income.
  • Borrowers with high debt-to-income ratios.
  • Homebuyers with less-than-perfect credit.

While customers and their situations come in all financial states and sizes, let’s examine a few hypothetical cases where Smart Series loans could close the difference between customers gaining access to loans or not.

Newrez’s SmartSelf: A Mortgage for Self-Employed Borrowers

Andrew is a full-time gig worker living in Dallas, Texas. He’s enjoying the new freedom that he’s found, having given up a traditional “nine-to-five” career after ten years as an accounts receivable clerk. He now splits his time between a few different apps – driving for a rideshare app, playing personal shopper, and works as a freelancer doing creative writing. With this life change, Andrew is also interested in purchasing a two-bedroom home for his family and move out of his current pricey apartment.

What are his chances?

As a non-QM (non-qualified mortgage) borrower Andrew will clearly not be able to apply for many traditional loan programs with no W2 income. A non-QM path can open up his opportunities – he will be able to use his bank statements and 1099s as part of alternative documentation, scale his loan payments with his income using flexible terms, and already come in with the understanding that his debt-to-income ratios are temporarily higher as he transitions into being a full-time gig worker and freelancer. Yes; getting a loan is still possible.

The advantages of SmartSelf loans include:

  • Alternative documentation is allowed.
  • Credit requirements are less strict.
  • Flexible terms like interest-only payments.
  • Higher debt-to-income ratios are allowed.
  • Purchase, refinance, and cash-out options remain available.

Newrez’s SmartEdge: For Borrowers Who Fall Just Outside of Jumbo Guidelines

To be honest, Vanessa of Nashville, Tennessee has had a tough few months. In January she was in a car accident where she was thankfully unharmed, but her car was totaled, leaving her to take out a small advance from a chain store credit card to afford a down payment for a new car. In March she needed an emergency root canal, which she opened a new credit card account for, and in April her job cut her hours back to half. While she’s making it, a few payments on these accounts have had to slip into collections to afford her rent, so her credit now has two recent late payments/collections alongside the new auto loan and credit account.

She couldn’t possibly qualify for a mortgage now, right? Well, not necessarily.

Of course, Vanessa will find more success with non-QM (non-qualified mortgage) programs – in this case, the SmartEdge program would be beneficial, as the program offers competitive financing for borrowers who sit just outside of traditional reach due to recent credit activity. Using SmartEdge, Vanessa just may be able to qualify given other offers discussed with a loan officer.

SmartEdge has its advantages, like SmartSelf:

  • Alternative documentation is allowed.
  • Credit requirements are less strict.
  • Flexible terms like interest-only payments.
  • Higher debt-to-income ratios are allowed.
  • Purchase, refinance, and cash-out options remain available.

Newrez’s SmartVest: A Dynamic Investor Home Loan

Scott owns a few rental properties in Phoenix, Arizona and a company that creates investment software. His company has been growing exponentially the last few years – he wants to abandon his pricey landlord/tenant lease in an office building and purchase a property closer to the suburbs where he and his employees live. The problem is, though, with the growth his company is undergoing, he doesn’t have a huge cash reserve typically needed for purchasing an investment/business property – he needs that money for marketing and hiring new development staff.

Is it possible or has Scott programmed himself into a corner?

While under some circumstances Scott wouldn’t be considered a non-QM (non-qualified mortgage,) in this situation he would be. Using a SmartVest loan, non-QM (non-qualified mortgage) loans designed for investors, Scott would be able to use the equity in his current real estate portfolio to purchase the property – additionally, if he finds extra space to rent out to another business within the same building he can use the rental amount to put toward loan repayments – and therefore find it easier to qualify for the loan he’s looking for.

Remember the SmartVest advantages:

  • Allows for the purchase additional investment portfolio inventory.
  • Provides access to equity in a current portfolio of homes to buy more investment properties.
  • Can use equity in current portfolio to upgrade or remodel existing portfolio properties.
  • Market rent (cash flow) from the subject property can be used to qualify.

Smart Series Loans Make Sense: Non-QM Myth Debunked

It’s important to understand that non-QMs are becoming an increasingly attractive mortgage choice for a variety of borrowers – and for good reason. One of the most common myths about non-QMs is that they’re high-risk loans designed for subprime, high-risk borrowers. This is not the case. The non-QM market share is growing not because there has been an increase of high-risk borrowers entering the mortgage market, but because we’re meeting the demand for tailor-made financing solutions built for buyers with unique finances in mind.

Convinced? From here, it’s up to us, as mortgage professionals, to serve more borrowers with home loans that meet their needs and continue paving the way for them to achieve their homeownership dreams.


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