Non-QM Loans
Alternative documentation for self-employed borrowers and investors.
Non-QM stands for non-qualified mortgage. These loans sit outside standard agency rules, not because the borrower is risky, but because the income does not fit a W-2 shaped box.
Self-employed owners who write off aggressively, retirees living on assets, and investors buying on rental cash flow are all common Non-QM borrowers.
Common documentation paths
Rather than tax returns, Non-QM programs qualify income in a few different ways. The right one depends on how your money actually flows.
- Bank statement: 12 or 24 months of deposits used to derive income
- Asset depletion: qualifying income calculated from liquid assets
- DSCR: investment property qualified on rental income versus payment
- 1099 or P&L: income documented without full tax returns
What to expect on pricing
Non-QM rates are generally higher than agency loans because the investor takes on documentation flexibility. For many borrowers the tradeoff is worth it, and refinancing into an agency loan later is often possible once the file supports it.
Documents to gather
What you provide depends on the documentation path we choose together.
- Bank statement path: 12 or 24 months of personal or business statements
- Asset path: recent statements for liquid and retirement accounts
- DSCR path: lease agreements or a market rent schedule from the appraisal
- Business license or CPA letter confirming self-employment
Advantages
- Qualify without traditional income documentation
- Investor-friendly structures like DSCR
- Options after a recent credit event
Things to consider
- Higher rates and fees than agency loans
- Larger down payment is common
- Guidelines vary widely by investor
Common questions
Will I need tax returns?
Usually not. Most Non-QM paths use bank statements, assets, or rental income instead.
Can I refinance out of a Non-QM loan later?
Often yes. Once your documented income or credit profile supports agency guidelines, a refinance may lower your rate.
Do DSCR loans check my personal income?
No. A DSCR loan qualifies on the property's rental income versus its payment, so personal debt-to-income is not part of the calculation.
Program disclaimers
- * Higher interest rates apply
- ** For a 30-year, fixed-rate loan
- Program details are informational only and are not an offer for extension of credit or a commitment to lend. Terms are subject to change without notice.
Ready to explore Non-QM financing?
Start a conversation with a licensed loan officer, or begin your application whenever you're ready.