Flexible mortgage options for self-employed borrowers, real estate investors, foreign nationals, and others whose income, credit, property, or financial profile may not fit traditional lending guidelines.
Non-QM programs may use alternative documentation such as bank statements, rental-property cash flow, assets, 1099 income, or profit-and-loss statements. Loan availability, documentation, rates, down-payment requirements, and terms vary by program.
Non-QM loans provide alternative ways to document income, assets, credit, or property cash flow when a borrower does not fit conventional or government-loan guidelines.
These loans may offer greater flexibility, but they can also involve higher interest rates, larger down payments, additional reserves, prepayment penalties on eligible business-purpose loans, or other program-specific requirements.
Use personal or business bank statements, 1099 income, or a profit-and-loss statement when tax returns do not accurately reflect current cash flow.
Qualify using eligible rental-property cash flow rather than traditional employment income through a DSCR program.
Use qualifying assets to demonstrate the ability to repay through an asset-utilization or asset-depletion program.
Finance eligible U.S. property without traditional U.S. income, credit, or residency documentation, subject to program requirements.
Certain programs may consider borrowers after bankruptcy, foreclosure, short sale, or other credit events sooner than traditional guidelines permit.
Finance certain non-warrantable condominiums, condotels, mixed-use properties, or other properties that may not meet agency requirements.
Use eligible personal or business bank deposits to document qualifying income instead of relying solely on tax returns.
Common features:
Eligible independent contractors may qualify using 1099 earnings and supporting documentation rather than complete personal and business tax returns.
Common features:
Certain self-employed borrowers may qualify using a year-to-date profit-and-loss statement prepared by an eligible third party.
Common features:
A debt-service coverage ratio loan evaluates whether a rental property’s eligible income supports its proposed housing expense.
Common features:
Short-term business-purpose financing may help investors acquire and renovate eligible properties for resale.
Common features:
Mortgage financing for eligible non-U.S. citizens purchasing second homes or investment properties in the United States.
Common features:
Financing for eligible borrowers who use an Individual Taxpayer Identification Number rather than a Social Security number.
Common features:
Flexible financing for eligible condominium projects that do not meet standard agency requirements.
Common features:
Eligible borrowers with substantial liquid or retirement assets may be able to calculate qualifying income from those assets.
Common features:
Traditional mortgage:
Commonly relies on W-2s, pay stubs, and tax returns.
Non-QM mortgage:
May permit bank statements, assets, rental cash flow, 1099s, or profit-and-loss statements.
Traditional mortgage:
Must generally meet agency or government-program guidelines.
Non-QM mortgage:
May accommodate unique properties, recent credit events, investors, or foreign-national borrowers.
Traditional mortgage:
Often offers lower rates and smaller down-payment options to qualified borrowers.
Non-QM mortgage:
May require higher rates, larger down payments, greater reserves, or additional fees.
Traditional mortgage:
Follows standardized conventional or government guidelines.
Non-QM mortgage:
Uses program-specific underwriting while still evaluating the borrower’s or transaction’s qualifications.
Non-QM loans may carry higher interest rates, points, or closing costs than comparable traditional mortgages.
Available loan-to-value limits depend on the borrower, property, documentation type, credit profile, and program.
Some programs require several months of housing payments or additional reserves after closing.
Certain eligible business-purpose investment loans may include a prepayment penalty. Consumer-purpose and state restrictions apply.
Alternative documentation does not mean no documentation. Borrowers may need bank statements, business records, leases, asset statements, identification, or other supporting materials.
One lender’s Non-QM program may differ significantly from another’s. Rates, qualifying calculations, property restrictions, and documentation requirements should be compared carefully.
We discuss your income, assets, credit, property, occupancy, loan purpose, and financing goals.
We compare tax returns, bank statements, 1099 income, profit-and-loss statements, assets, or property cash flow.
You receive a personalized review of estimated rates, payments, down payment, reserves, fees, and loan terms.
We coordinate documentation, appraisal or property review, title, underwriting, and approval.
Once approved, we review the final terms, required funds, closing documents, and any applicable prepayment conditions.
A Non-QM loan is a mortgage that does not meet the legal requirements of a Qualified Mortgage. It may use alternative documentation or contain other features outside standard QM guidelines. The lender must still follow applicable underwriting and ability-to-repay requirements for covered consumer-purpose loans.
No. Non-QM describes the loan’s regulatory classification, not necessarily the borrower’s credit quality. Non-QM programs serve borrowers with many different profiles, including strong-credit self-employed borrowers and investors.
Not always. Some programs may use bank statements, 1099 income, assets, profit-and-loss statements, or rental-property cash flow. Documentation requirements vary.
Possibly. Some programs allow shorter waiting periods after bankruptcy, foreclosure, short sale, or other credit events than conventional financing. Requirements vary by program.
A bank statement loan uses eligible deposits from personal or business bank statements to calculate qualifying income for a self-employed borrower.
A DSCR loan generally evaluates an investment property using its eligible rental income compared with the proposed housing expense.
Certain programs allow eligible foreign nationals to purchase U.S. second homes or investment properties using passports, foreign credit references, assets, and other documentation.
They may be. Pricing depends on credit, down payment, documentation, property, occupancy, loan purpose, and market conditions.
Yes, certain Non-QM programs are available for primary residences. Others are limited to second homes or business-purpose investment properties.
The required amount varies significantly based on the selected program, credit profile, property type, occupancy, and documentation method.
Traditional guidelines do not always reflect how self-employed borrowers, investors, and high-net-worth households earn or manage money. I can help you compare available Non-QM options and identify the documentation method that best represents your situation.
Non-QM loans are subject to credit, income or alternative-documentation, asset, property, valuation, down-payment, reserve, and lender requirements. Rates, terms, fees, loan-to-value limits, and program availability vary. Alternative documentation does not mean no documentation or guaranteed approval. Some business-purpose investment loans may include prepayment penalties where permitted.
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Robert St. John | NMLS #1578510 | Barrett Financial Group, L.L.C. | NMLS #181106 | 8485 W Sunset Rd, Suite 202, Las Vegas, NV 89113 | AZ 0904774 | CA60DBO-46052 & 41DBO-148702 Licensed by Dept . of Financial Protection & Innovation under the California Residential Mortgage Lending Act. Loans made or arranged pursuant to a California Financing Law License | MI fl0022342 | NV 5091 | TX view complaint policy at barrettfinancial.com/texas-complaint | Equal Housing Opportunity | Equal Housing Lender | This isnot a commitment to lend. All loans are subject to credit approval. | nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/181106