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Non-QM loans offer alternative financing options for borrowers who may not qualify for traditional QM loans. These programs often cater to individuals with unique financial situations, such as self-employed borrowers or those with non-traditional income sources. Here are some key features of Non-QM loan programs:
Non-QM (Non-Qualified Mortgage) loan programs are mortgage loans that do not meet the criteria for Qualified Mortgages (QM) as defined by the Consumer Financial Protection Bureau (CFPB). QM loans adhere to certain guidelines to ensure that borrowers have the ability to repay the loan.
Flexible Qualification Criteria: Non-QM loans may have more lenient qualification criteria compared to traditional mortgages. This can include alternative documentation for income verification.
Interest-Only Loans: Some Non-QM loan programs offer interest-only payment options, allowing borrowers to make lower monthly payments initially.
Higher Debt-to-Income Ratios: Non-QM loans may accept higher debt-to-income ratios than QM loans, making it easier for borrowers with higher levels of debt to qualify.
Alternative Credit Histories: Borrowers with non-traditional credit histories or past credit issues may find Non-QM loans more accessible.
Investment Properties: Non-QM loans may be available for financing investment properties, allowing borrowers to diversify their real estate portfolios.
Bank Statement Loans: Self-employed individuals who may not have traditional income documentation can use bank statements to demonstrate their ability to repay the loan.
It’s important to note that Non-QM loans may come with higher interest rates and may carry additional risks for both borrowers and lenders. Borrowers considering Non-QM loans should carefully review the terms, understand the potential risks, and consult with a mortgage professional to determine the best fit for their financial situation.
Neither foreclosure nor bankruptcy disqualify you from an FHA loan. You are still encouraged to submit an application so long as you meet the credit and income requirements. If you filed Chapter 7 bankruptcy, then at least two years must have passed before you can get approved for an FHA loan.
The mortgage lender will look at your entire financial situation, not just your history. They will consider how you have made payments since foreclosure or bankruptcy and how you currently manage your debts and income.
We can help you explore all your home financing options, no matter what your history may be. Our team is here to help everyone get the home they deserve.
