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Non-QM Loans — Mortgage Solutions for Borrowers Who Don't Fit the Box
Non-QM loans offer flexibility that traditional loans can't match. Bank statement programs, asset depletion for retirees, recent credit event programs, foreign national loans, and more. We specialize in finding solutions when traditional lenders say no.
Trusted by over 2,500 California families
700+
Non-QM Funded
Bank Stmt
Programs Available
Credit Event
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Don't Fit Traditional Guidelines?
Complex situation? We specialize in finding solutions.
Don't Fit Traditional Guidelines?
Complex situation? We specialize in finding solutions.
Non-QM Loans at a Glance
Non-QM loans are legitimate products from established lenders with proper disclosures — designed for borrowers who don't fit the traditional mold.
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What is a non-QM loan?
A mortgage that doesn't meet government "qualified mortgage" rules but offers more flexibility.
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Who are they for?
Self-employed, investors, foreign nationals, those with recent credit events, complex income.
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Are rates higher?
Generally yes, 0.5-2% higher than conventional, reflecting added flexibility.
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Down payment?
Typically 10-25% depending on program. Some programs allow as low as 10%.
What Is a Non-QM Loan?
After the 2008 financial crisis, the government created rules defining "Qualified Mortgages" (QM). Non-QM loans are mortgages that don't meet all QM criteria — but that doesn't make them bad loans. They simply offer flexibility for borrowers whose situations don't fit the QM box.
Why Non-QM Loans Exist — millions of Americans have legitimate income that's hard to document the traditional way:
Business owners who take tax deductions that lower their reported income
Freelancers and gig workers with variable income
Retirees living off investments rather than paychecks
Real estate investors whose rental income doesn't fit DTI calculations
Foreign nationals working in the U.S. without traditional credit history
People rebuilding after bankruptcy or foreclosure
Non-QM loans are NOT "subprime" loans. Full documentation is still required, ability to repay is verified, and responsible underwriting practices apply with clear disclosures and consumer protections.
Non-QM Loan Programs We Offer
We offer a comprehensive range of non-QM solutions. Here are the main programs available:
Best for: Self-employed borrowers, business owners, freelancers, and 1099 contractors. Instead of tax returns, we use 12-24 months of bank statements to calculate your income.
- 12 or 24 months of personal or business bank statements
- No tax returns required
- Self-employed 1-2+ years
- Credit scores from 620 (some programs lower)
- Down payment: 10-25%
- Loan amounts up to $3 million+
Why borrowers choose this: Your tax returns show $80,000 after deductions, but your deposits show $180,000. Bank statement loans let you qualify on your real income.
Who Benefits from Non-QM Loans?
Non-QM loans serve a wide range of borrowers with legitimate needs. Here's who benefits most from these flexible programs.
Common Non-QM Borrower Profiles
| Borrower Type | How Non-QM Helps |
|---|---|
| Self-Employed Business Owners | Your tax returns show $70,000 after deductions, but your bank deposits show $200,000. Non-QM bank statement loans use your real income. |
| Freelancers and Gig Workers | Variable income, 1099s from multiple sources, and irregular payment timing make traditional documentation difficult. Non-QM offers alternatives. |
| Real Estate Investors | You own 15 rental properties but can't qualify with personal income. DSCR loans let the properties qualify themselves. |
| Retirees and High-Net-Worth Individuals | You have $3 million in investments but no W-2 income. Asset depletion loans convert your wealth into qualifying income. |
Non-QM loans serve borrowers with legitimate needs who simply don't fit traditional qualification methods.
Additional Borrower Situations
Non-QM programs also serve these borrowers:
Recent Credit Event Survivors
Bankruptcy was discharged 6 months ago. Traditional lenders require 4 years. Non-QM recent credit event programs may work now.
Foreign Nationals
You're a citizen of another country wanting to buy U.S. property. Foreign national programs don't require SSN or U.S. credit history.
ITIN Holders
You live and work in the U.S. but have an ITIN instead of SSN. ITIN programs accept alternative documentation.
Business Owners with Complex Taxes
K-1 income, S-Corp distributions, depreciation, and loss carryforwards make your taxes look complicated. Non-QM simplifies the process.
Not Sure Which Program Fits?
Your situation is unique — that's exactly why non-QM loans exist:
We analyze your full picture
Income sources, assets, credit history, and goals — we look at everything.
We match you to the right program
With access to multiple non-QM lenders, we find the best fit for your situation.
We guide you through the process
Non-QM can be confusing. We explain every option and what to expect.
Non-QM Loan Requirements
Requirements vary significantly by program. Here are general guidelines across our non-QM products.
Credit Score by Program
- Bank Statement Loans: 620+
- Asset Depletion: 680+
- DSCR Loans: 620+
- Recent Credit Event: 600+
- Foreign National: No U.S. credit (or 660+)
- ITIN Loans: 660+
- Interest-Only: 680+
Down Payment & Reserves
Down Payment:
- Bank Statement: 10-25%
- Asset Depletion: 20-30%
- DSCR: 20-25%
- Recent Credit Event: 20-35%
- Foreign National: 25-30%
Reserves:
- 6-12 months PITIA for primary residence
- 6-12 months PITIA per financed property
Documentation by Program
Bank Statement:
- 12-24 months bank statements
- Business license or proof of self-employment
Asset Depletion:
- Complete asset statements (all accounts)
- Proof of liquidity
DSCR:
- Rent roll or lease agreements
- Property appraisal
Foreign National:
- Passport and visa documentation
- Foreign income verification
Non-QM Loan Rates and Costs
Interest Rate Premiums
Compared to conventional rates, expect the following premiums by program:
Rates reflect increased flexibility and risk. For many borrowers, this is a reasonable trade-off for homeownership access.
When Higher Rates Make Sense
A higher rate may be worth it when:
You can't qualify for conventional financing
Non-QM opens the door when traditional lenders say no.
The alternative is not buying at all
Homeownership now may outweigh waiting years to qualify conventionally.
You plan to refinance later
Once your situation improves, refinance into a conventional loan with better rates.
Investment returns exceed the rate premium
For investors, the property's return often more than compensates for the higher rate.
Closing costs are similar to conventional loans: 2-5% of loan amount. Origination fees may be slightly higher.
How Non-QM Loans Work — The Process
The non-QM process is similar to traditional loans with some key differences. Here's what to expect from start to keys-in-hand.
Your path to homeownership:
Step 1: Initial Consultation — we discuss your situation, goals, and challenges to identify the right non-QM program
Step 2: Program Selection — based on your circumstances, we match you with the appropriate non-QM product
Step 3: Documentation Collection — we gather the specific documents your program requires, tailored to your situation
Step 4: Pre-Approval — we verify your documentation and issue a pre-approval letter showing you're qualified
Step 5: Property Search and Contract — with pre-approval in hand, shop for homes and make competitive offers
Step 6: Underwriting and Approval — an experienced underwriter reviews your complete file with manual underwriting
Step 7: Closing — final documents are prepared, you sign, and the home is yours
Timeline: Non-QM loans typically take 30-45 days to close. Complex situations may require additional time. Working with an experienced non-QM lender ensures a smooth process.
Non-QM Myths — Setting the Record Straight
Don't let misinformation keep you from exploring your options. Here are the facts:
Reality: Non-QM loans are not subprime. They require documentation, verify ability to repay, and follow responsible underwriting. They simply use alternative methods suited to non-traditional borrowers.
Why Borrowers Choose Bay Area Realty for Non-QM Loans
When traditional lenders say no, we find the path to yes. Here's why non-QM borrowers trust us.
We Specialize in Non-QM
Non-QM isn't a side product for us — it's a core specialty. We understand every program, every guideline, and every documentation requirement.
Access to Multiple Programs
We work with numerous non-QM lenders, giving us access to the full range of programs. If one lender says no, we have alternatives.
We Find Creative Solutions
Your situation is unique. We don't just run you through a system — we analyze your circumstances and identify the best path forward.
We Explain Everything
Non-QM can be confusing. We take time to explain your options, the trade-offs, and what to expect so you can make informed decisions.
"Every bank turned me down because I'm self-employed and take a lot of deductions. Bay Area Realty used my bank statements and got me approved in three weeks. My rate is slightly higher than conventional, but I'm in my home — that's what matters. They made it happen when no one else could."
— Michelle R., Business Owner, San Mateo
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