Non-QM mortgages are a type of mortgage that allows borrowers to get a loan without having to provide extensive documentation or meeting traditional income qualifications. There are many benefits of Non-QM loans. For one, non-qualified mortgage loans are great for clients working with mortgage brokers. Mortgage brokers can offer borrowers a wide range of loan products and get the best interest rates for their clients. They can also work with self-employed borrowers who may have difficulty qualifying for a traditional mortgage. In this article, we will discuss some of the main advantages of Non-QM mortgages as of August 2024.
This article was originally published on July 28, 2022.
8 Great Benefits of Non-QM Loans
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Unlock Rewards- Self-employed? No problem! If your client is self-employed, you know that it can be difficult to qualify them for a traditional mortgage. Non-QM mortgage lenders like A&D Mortgage are more flexible when it comes to income documentation, so self-employed borrowers can qualify for a loan.
- Credit score? No problem! If your clients have less than perfect credit, they may still be able to qualify for a Non-QM mortgage. Some lenders offer loans to borrowers with a credit score as low as 620, like our DSCR loan.
- No income verification required. If your clients don’t have W-2 incomes, we may still offer them a loan. This is because Non-QM loans are not restricted by the Qualified Mortgage guidelines that require borrowers to verify their income.
- Higher loan amounts up to $4 million. If your clients want to finance a high-end home, with A&D Mortgage they may be able to get a loan for up to $4 million. This is because Non-QM loans are not restricted by the Qualified Mortgage limit of $766,550 (as of 2024.)
- Loan terms to fit your needs. Non-QM loans can have terms that fit your borrowers’ unique financial situations. If they need a longer loan term or want to make interest-only payments, you will find a Non-QM loan that meets your needs.
- Fast funding. Non-QM loans can be funded faster than traditional loans as the underwriting process is often quicker and there is less documentation required.
- No DTI requirements. There are no debt-to-income ratio requirements with some Non-QM loans, so your client can qualify even if their DTI is high.
- Lenient seasoning guidelines. With some traditional loans, your clients may need to wait 12 months after a major financial event before they can qualify. With Non-QM loans, this waiting period is often shorter or even non-existent.
Benefits of Non-QM Loans with A&D Mortgage (August 2024)
At A&D Mortgage, we offer a comprehensive range of Non-QM mortgage loan programs tailored to meet diverse borrowing needs. Our Non-QM solutions provide flexibility and accessibility for various borrower types, ensuring you can find the perfect fit for your unique financial situation. Here’s a snapshot of our Non-QM offerings:
DSCR Loans
- Min. FICO: 620
- CLTV: Up to 80%
- Key Benefits: Fastest turn times in the industry, no income or employment verification, short-term rental options available, credit for DSCR >1.25.
DSCR loans:
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- DSCR as low as 0
- No income and no employment needed
- Fastest turn times in the industry
12/24 Month Bank Statement Loans
- Min. FICO: 620
- CLTV: Up to 90%
- Key Benefits: Ideal for self-employed borrowers, personal/business/combined bank statements, concierge service for income calculation, 3 months of reserves required.
Bank Statement:
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- The perfect fit for self-employed borrowers
- Up to 90% CLTV, loans up to $4M
- Low FICO options (from 599)
ITIN Loans
- Min. FICO: 660
- CLTV: Up to 80% (Super Prime), Up to 70% (DSCR)
- Key Benefits: Expand your portfolio for borrowers without an SSN, loan amounts up to $1.5 million.
1Y + 2Y P&L Loans
- Min. FICO: 660
- CLTV: Up to 80%
- Key Benefits: Alternative solution for self-employed borrowers, no bank statements required up to 70% LTV, loan amounts up to $2.5 million.
Check out 1Y + 2Y P&L Loan program
1Y or 2Y Full Doc Non-QM Loans
- Min. FICO: 620
- CLTV: Up to 90%
- Key Benefits: Flexible solution for Full Doc borrowers, loan amounts up to $4 million, DTI up to 55% on owner-occupied properties, 3 months of reserves required.
Check out 1Y or 2Y Full Doc Non-QM Loan program
1099 Loans
- Min. FICO: 620
- CLTV: Up to 85%
- Key Benefits: Perfect for sole proprietors or contract individuals, requires only 1 year of 1099s and history with the same employer, gift funds allowed.
WVOE Loans
- Min. FICO: 620
- CLTV: Up to 80%
- Key Benefits: No tax returns required, 3 months of reserves, suitable for salaried borrowers with no tax returns.
Asset Utilization Loans
- Min. FICO: 620
- CLTV: Up to 80%
- Key Benefits: Ideal for borrowers with liquid assets (retirees, investors, self-employed), qualifying assets/60 months, loan amounts up to $4 million.
Asset Utilization:
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- Minimum FICO 599
- Up to 80% CLTV
- Checking, savings, stocks, bonds
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See Program DetailsForeign Nationals DSCR Loans
- No Score or Min. FICO: 660
- CLTV: Up to 70%
- Key Benefits: Minimal documentation and fast closings, loan amounts up to $3 million, cash-out allowed, DSCR < 1 requires min FICO 680 or no FICO.
Check out Foreign Nationals DSCR Loan program
Foreign Nationals Full Doc Loans
- No Score or Min. FICO: 660
- CLTV: Up to 75%
- Key Benefits: Suitable for Foreign National borrowers with overseas income, loan amounts up to $3 million, overseas assets allowed, RON permitted.
Check out Foreign Nationals Full Doc Loan program
To Sum Up
As you can see, there are many advantages to Non-QM mortgages as of August 2024. If you’re looking for a loan that is tailored to your needs, a Non-QM mortgage may be the right choice for you.
Fortunately, A&D Mortgage has been offering Non-QM loans since the mid-2000s, so we have the experience and knowledge to help you navigate this type of loan. If you’re interested in learning more about Non-QM loans or our other loan programs, contact your account executive today. We’re here to help you find the right loan for your needs.
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