A Wealth of Information and Service - Contact a Loan Officer (800) 718-8906
A Wealth of Information and Service - Contact a Loan Officer (800) 718-8906
Non-QM mortgage lender programs include QM, Non-QM, Prime, Non-Prime, Portfolio, Foreign National, Hard Money, Private Money, and Investment Property loans. These loans are for borrowers with perfect credit and can also be for borrowers that have imperfect credit i.e., Unseasoned “life credit events” such as bankruptcy, foreclosure, short sale, late payments, limited credit. All Non-QM mortgages are manual underwritten programs.
In the U.S., there are two main types of mortgages: Qualified Mortgages (QM) and Non-Qualified Mortgages (Non-QM).
Qualified Mortgages are agency-backed and include:
* Federal National Mortgage Association (FNMA), aka “Fannie Mae”,
* Government National Mortgage Association (GNMA), aka “Ginnie Mae”,
* Federal Home Loan Mortgage Corporation (FHLMC), aka “Freddie Mac”,
* Federal Housing Authority (FHA),
* Veterans Administration (VA).
TThese are often referred to as agency lenders or government lenders.
Non-Qualified Mortgages, on the other hand, operate under a different set of rules. Instead of following government regulations and mortgage-backed securities (MBS) standards, Non-QM loans are driven by the private market.
Non-QM lenders base their approvals on the Ability to Repay (ATR) rule, not on agency resale requirements. This allows them to consider the borrower’s entire financial profile—credit history, profession, business model, income sources, cash flow, and repayment potential.
With more flexible documentation, alternative income verification, and creative underwriting, Non-QM programs provide solutions not available through traditional, agency-backed mortgages.
Non-QM mortgage lending is about alternative documentation in the areas of income documentation as well as employment. Non-QM mortgage product, pricing, guidelines, and availability is private sector driven by privately owned investment companies, hedge Fund companies and is predicated on market performance.
It is not logical to expect a self-employed borrower to produce traditional income documentation to qualify for a home loan. Non-QM Mortgage underwriters look for responsible ways to approve a loan because they are make-sense decision makers. Agency lender underwriters reach for reasons to decline a loan and are more like order-takers. A successful business owner did not achieve their success by accepting a decline notice from an order-taker. Successful entrepreneurs find out how to get things done. This spirit of determination is synonymous with the progressive nature of Non-QM lending.
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