๐ก Common Types of Non-QM Loans
๐ Bank Statement Loans
- Use 12โ24 months of bank statements to verify income
- Ideal for self-employed borrowers or freelancers
- No need for tax returns or W-2s
๐ DSCR Loans (Debt Service Coverage Ratio)
- Used for investment properties
- Qualification based on rental income vs. loan payment
- No personal income verification required
๐ฐ Asset-Based Loans
- Approval based on liquid assets and net worth
- Great for high-net-worth individuals with low monthly income
๐ Foreign National Loans
- Designed for non-U.S. residents buying property in the U.S.
- Alternative credit and income documentation accepted
๐งพ Profit & Loss Statement Loans
- Use business P&L statements to verify income
- Suitable for small business owners and entrepreneurs
๐ Interest-Only Loans
- Pay only interest for a set period (e.g., first 5โ10 years)
- Lower initial payments, but principal remains unchanged
๐ ๏ธ Fix-and-Flip Loans
- Short-term financing for buying and renovating properties
- Common among real estate investors
๐๏ธ Construction Loans
- Fund the building of new homes or real estate projects
- Typically short-term and disbursed in stages
๐ Asset Depletion Loans
- Convert assets into qualifying income
- Often used by retirees or investors with substantial savings
โ Who Benefits from Non-QM Loans?
- Self-employed professionals
- Real estate investors
- Retirees with significant assets
- Borrowers with recent credit events
- Foreign nationals
- Gig workers and freelancers