The path to homeownership or financing investment properties doesn't always fit neatly into the box of traditional lending. That's where Non-Qualified Mortgages (Non-QM) come in. These loans undoubtedly offer flexibility beyond standard qualifications. That is what makes them an ideal choice for self-employed individuals, investors, and anyone with unique financial situations.
12 Non-QM Loans For You to Consider
Here are 12 Non-QM loan programs recommended by SRK CAPITAL. Each offers a unique choice to meet a variety of needs and goals.
1. Bank Statement Loans
For self-employed borrowers or freelancers, proving income can be challenging with standard income documentation. Bank Statement Loans allow you to qualify based on your bank statement cash flow. Unlike traditional loans that use tax returns, pay stubs, and W-2s.
Why We Love Them: This program gives entrepreneurs the chance to leverage their actual income. These loans let you avoid the complications of having to get a traditional income verification.
2. Asset Depletion Loans
Ideal for retirees or investors with a lot of assets but minimal income. Asset Depletion Loans calculate monthly income based on your liquid assets rather than reported earnings. It's a flexible solution for individuals who rely on investments, savings, or inheritances.
Why We Love Them: This loan choice provides a practical route for asset-rich clients to finance homes. All without needing traditional income documentation.
3. Debt Service Coverage Ratio (DSCR) Loans
For real estate investors, DSCR Loans are a game-changer. They allow you to qualify for a loan based on your rental property's cash flow. Meaning you don't have to use your personal income to get approved, making it easier to expand your portfolio.
Why We Love Them: This program unquestionably empowers investors to leverage property income, freeing up their finances for multiple investments.
4. Interest-Only Mortgages
With an Interest-Only Mortgage, borrowers pay only the interest of the loan for a set period. This allows for lower monthly payments. This choice can be especially appealing for investors or buyers expecting to sell or refinance within a few years.
Why We Love Them: Interest-only payments mean more cash flow in the short term. Thus providing extra flexibility for owners with long-term plans.
5. Foreign National Loans
Foreign National Loans are designed for non-U.S. residents who wish to buy property in the United States. These loans ask for less documentation and often use different forms of income verification.
Why We Love Them: This loan makes U.S. property ownership accessible for international buyers who otherwise don't have access to the US Real Estate market.
6. Community Mortgages
Community Mortgages remove debt-to-income (DTI) ratio requirements. This makes them an excellent choice for borrowers with non-traditional income who don't meet standard DTI requirements.
Why We Love Them: These loans offer can be a path to homeownership. Especially for those who are overlooked by traditional loan choices. This program uses smart lending guidelines to open the door to homeownership for many underserved borrowers.
7. Jumbo Non-QM Loans
For buyers needing high loan amounts, Jumbo Non-QM Loans extend beyond conventional loan limits without strict income verification. These loans are ideal for purchasing luxury properties or financing in high-cost areas.
Why We Love Them: Jumbo Non-QM Loans allow high-end buyers to bypass traditional barriers and secure their dream homes.
8. ITIN Loans
For borrowers without a Social Security number, ITIN Loans allow access to home financing. They can use their Individual Taxpayer Identification Number (ITIN) instead. This loan helps more people, including those new to the U.S., enter the housing market.
Why We Love Them: ITIN Loans expand access to homeownership. These loans make it possible for people without SSNs to invest in property.
9. Self-Employed Mortgages
Business owners or self-employed individuals face extra hurdles in finding great home financing. Self-employed mortgages consider different forms of income documentation. Examples are profit & loss statements or Form 1099 statements, allowing entrepreneurs to qualify based on their true income.
Why We Love Them: This program specifically opens the door for entrepreneurs. These types of loans help secure business owners financing that reflects their actual earning capacity.
10. Bridge Loans
Bridge Loans offer temporary financing for buyers transitioning between properties. It gives them the funds needed to buy a new home before selling their current one. This type of loan program is short-term, often with interest-only payments.
Why We Love Them: This loan is perfect for those who need liquidity quickly. They can help you conveniently move without waiting for their current home to sell.
11. Recent Credit Event Loans
For borrowers with recent credit events like a foreclosure, bankruptcy, or a short sale. Recent Credit Event Loans offer a second chance. These loans consider borrowers with less-than-perfect credit, often with flexible terms.
Why We Love Them: This program helps clients rebuild. They offer a clear path to homeownership, even after significant financial setbacks.
12. Fix-and-Flip Loans
Fix-and-Flip Loans are designed for real estate investors purchasing homes to renovate and resell. These short-term loans cover both the buying and renovation costs, allowing investors to maximize profit upon resale.
Why We Love Them: This loan fuels the property flipping industry, providing fast funding for buyers with immediate renovation goals.
Finding the Right Non-Qualified Mortgage (Non-QM Loan) for You
Non-QM loans offer flexible financing to borrowers that don't qualify for traditional mortgages. These programs allow for a creative approach to qualification, making home financing possible for a broader range of borrowers.
At SRK CAPITAL, we specialize in guiding clients through the nuances of Non-Qualified Mortgage loans. Our team is here to help you find the right loan for your individual needs. Contact SRK CAPITAL today to explore which Non-QM Loan is the right fit for your financial goals! You can also use our mortgage calculator to estimate your payments.