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Dominion Financial Services, a Baltimore-based private lender with products tailored to real estate investors, has launched a third-party origination program for mortgage brokers, according to an announcement on Thursday.
“This marks a significant milestone in the company’s commitment to expanding its reach and fostering partnerships within the real estate investment industry,“ the company said in its announcement. “Historically known for its direct-to-client approach, Dominion Financial Services is now opening its doors to broker partners, empowering them with access to long-term DSCR rental loans with a price beat guarantee.“
Debt-service-coverage ratio (DSCR) loans are nonqualified mortgages that allow the borrower to qualify based on the cash flow of the property rather than personal income. Dominion said it offers multiple DSCR options for investors, along with short-term fix-and-flip financing, ground-up construction financing and bridge loans for multifamily properties.
Demand for investment properties remains strong even as market conditions, such as higher mortgage rates and lower levels of inventory, hamper deals in similar fashion to consumer homebuyers.
In March, Attom reported that yields for single-family rental properties were set to rise in 2024. The data analytics firm projected that the average gross profit for a three-bedroom home would be 7.55% this year, up from 7.39% last year, driven by rent growth that is outpacing home-price growth.
The report noted that in the past year, median rents for three-bedroom homes rose more quickly than prices for similar owner-occupied homes in 63% of the markets it analyzed.
Wade Susini, chief lending officer at Dominion Financial Services, told HousingWire in an email response that while inventory levels remain low across the U.S., investors are “finding creative ways“ to acquire and redevelop real estate.
“With current rates and inventory challenges, deals can be harder and more expensive to secure, leading to the exit of inefficient operators,“ Susini said. “Nonetheless, savvy investors with efficient operations continue to invest. Dominion Financial still closes over $50 million per month in investor loans.“
Because speed is a key differentiating factor for investors when choosing a lender, Dominion typically closes its DSCR loans in less than 30 days, Susini said.
“For our core bridge loan product, we are a balance sheet lender that does not require appraisals,“ he added. “For approved borrowers, we can fund the loan as quickly as they can get the title work done, making our process as fast as cash.“
A national lender, Dominion was founded in 2022 and has reportedly funded more than $3 billion in loans across more than 11,000 deals. Its stated purpose behind the new program is to provide greater value to business partners through wholesale pricing and competitive interest rates to third-party originators.
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