We have experienced historic low interest rates over the last two years. During this time, homeowners have seized the opportunity to refinance mortgage loans. Homebuyers also took this opportunity to purchase homes with low mortgage rates. Now, mortgage rates are climbing, impacting the decision to refinance and purchase a home.
CNBC reports, “The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 3.72% from 3.64%.” They also found that refinance rates were 13% lower by the end of January 2022.
Rising rates give refinancers less incentive to refinance their loans. In another statement by CNBC, they explain, “mortgage applications to refinance a home loan are down by half from a year ago.” As rates rise, loan officers will need to find creative solutions to continue offering enticing loan opportunities.
Review current market rates below.
How can Innovative Capital Help?
Many savvy real estate investors are looking to lock in long-term fixed-rate mortgages to preserve their rental income. Partnering with Innovative Capital Corporation can help residential lenders finance commercial loans.
Innovative Capital specializes in streamlining the process of acquiring a commercial loan. We utilize a network of banks and in-house private capital to provide our clients with a range of available funding solutions.
We are committed to helping our clients achieve their financial goals regardless of market conditions. We believe there is always an opportunity to get the best-suited lenders connected with the best-suited borrower– even in the case of increasing rates.
Innovative Capital Corporation began in 2007, shortly before the Great Recession. Finding resources at the onset of our development allowed us to challenge ourselves from the start to make us stronger and wiser for our clients today. Overcoming these challenges forced us to quickly learn and pivot to find innovative solutions for our clients seeking capital.
With our diligence and strategic underwriting insights, we get our clients the funds they need to make their investment goals a reality. Today, we leverage our experience and continue to build on a foundation that has constantly evolved with the market.
Commercial Lending
Are there other areas of your investment profile that may need additional funding? Traditional commercial lending can help you fund upcoming investment projects.
Types of commercial lending options include:
- Lines of credit
- Bridge loans
- Traditional commercial loans
- Asset-based loans
We match your funding needs with the right loan type and help you find the most competitive rate available.
Opportunity for Residential Mortgage loan Officers
Another option to identify funding opportunities for Residential Mortgage Loan officers is through reviewing your client’s schedule E’s and schedule K-1 Income source to see other areas where you can find funding. This information will help you identify when your client may need commercial lending solutions.
What are Schedule E and Schedule K-1 Forms?
Schedule E (Form 1040) reports income from:
- Real estate rentals
- Royalties
- Partnerships
- Estates
- Trusts
- S corporations
- Trusts
- Residential interests.
Schedule K-1 income is a tax report for partnership investments. You can see your client’s partnered share earnings, losses, deductions, and credits on this form.
Alternative Lending Source
We specialize in traditional and alternative lending options. For real estate investors seeking alternative lending options, we provide diverse solutions. We can assist with an array of private lending for:
- Fix and flips
- Cash-out for business purposes
- Acquisition of investment real estate
- And more
Our in-house underwriting process can be applied to a variety of loans such as factoring, equity, commercial and industrial in as little as 7 days.
Final Thoughts
The past few weeks have shown a clear picture that rates are going to continue to rise. Their steady increase has already led to a massive decline in refinance volume. Protect your pipeline by partnering with our firm. We underwrite, approve, and fund loans transparently, so you always know what’s going on. The best part? To learn more about how treasury notes and commercial lending rates interact, read our article here.