UWM rolls out 1-0 buydowns, expands into home equity lending

United Wholesale Mortgage (UWM) is rolling out free 1-0 temporary rate buydowns on purchase loans alongside a new suite of home equity products aimed at helping brokers retain borrowers.

Effective immediately, the lender will cover the cost of 1-0 buydowns on both conventional and government purchase mortgages, issuing a credit to fully offset the expense. The offer—available on 8- and 30-year terms—runs through June 30. 

Under a 1-0 buydown, the borrower’s payment is calculated as if the interest rate were 1 percentage point lower in the first year. UWM’s structure gives borrowers a lower first-year payment at no additional cost to the borrower or the broker, with the lender credit covering the buydown.

Temporary buydowns have been one of the most widely used tools to manage payment shock in a high-rate environment, particularly on purchase loans. By removing the buydown cost, lenders give brokers another concession they can bring to sellers or listing agents and a way to differentiate in a market where rate competition is tight and margins are thin.

In a separate move, UWM also introduced home equity loans, offered as both standalone and piggyback second liens. The products provide a fixed rate and fixed term, funded in a single lump sum.

The loans allow debt-to-income ratios up to 50%, and range from $25,000 to $500,000. They’re available on primary residences, second homes and investment properties.

The standalone option targets homeowners looking to tap equity without disturbing a low-rate first mortgage—whether for renovations, debt consolidation or education costs.

The piggyback structure, meanwhile, can be used at purchase to avoid private mortgage insurance by keeping the first lien within conforming loan-to-value limits, or to sidestep jumbo financing by pairing a conforming first with a second lien.