There's almost always another path.
When conventional and government loans don't fit, non-QM steps in. Different documentation. Different rules. Same goal.
A non-QM (non-qualified mortgage) loan qualifies you with alternative documentation such as bank statements, assets, or a rental property's income, instead of the tax returns and W-2s that conventional, FHA, and VA loans require. It is built for self-employed borrowers, investors, and anyone whose real income does not fit the standard template, and it still follows the federal Ability-to-Repay rule.
Overview
Non-QM means Non-Qualified Mortgage. It doesn't mean bad. It means the loan doesn't fit inside the standard Fannie, Freddie, FHA, or VA guidelines. Bank statement qualification instead of tax returns. Asset depletion instead of employment income. Recent credit events with shorter waiting periods.
The average credit score on non-QM loans is well above average. These aren't subprime borrowers. They're people whose income or documentation doesn't fit a template, even though they clearly have the ability to repay.
The rates are higher. That's the cost of alternative documentation. But for many borrowers, the alternative to a non-QM loan isn't a cheaper loan. It's no loan at all. If you've been told no by a traditional lender, it's worth a conversation.
Key Details
How I Handle Texas Non-QM Loans
I figure out why the standard path doesn't work. Then identify which non-QM program fits and match it to the right lender.
Non-QM pricing varies more across lenders than conventional. Some price well but can't close. Some close reliably but price higher. I know which ones do both. Common non-QM subtypes: bank statement loans, DSCR, foreign national loans, and ITIN loans.
Questions I Get
Is non-QM the same as subprime?
No. Subprime meant minimal documentation and poor underwriting. Non-QM uses alternative documentation with proper verification. Different product entirely.
Are rates much higher?
Higher than conventional. Not as dramatic as most people fear. Depends on the specific program, credit, and down payment. For many borrowers, the premium is worth it because the alternative is not buying.
Which program fits me?
Self-employed with strong deposits? Bank statement. Investor? DSCR. Retired with assets? Asset depletion. Recent credit event? Specialized programs exist. I figure out the match.
Are they safe?
Yes. Same consumer protection framework. Ability-to-Repay requirement applies.
What does non-QM stand for, and how does a non-QM loan work?
Non-QM stands for non-qualified mortgage. It simply means the loan sits outside the Fannie Mae, Freddie Mac, FHA, and VA rule boxes. Instead of tax returns and W-2s, the lender verifies your ability to repay with alternative documentation: bank-statement deposits, assets, or the property's rent. Everything is still fully underwritten.
Is a non-QM loan a conventional loan?
No. Conventional loans follow agency (Fannie/Freddie) guidelines with full income documentation. Non-QM is a separate category for borrowers whose income or credit history does not fit those guidelines, even when they clearly qualify on the numbers.
What are the main non-QM loan programs?
The common ones are bank statement loans (self-employed), DSCR loans (investors, qualified on rent), asset depletion (qualify on reserves), ITIN and foreign national loans, and programs for recent credit events. I match the right one to your file.
What credit score do I need for a non-QM loan?
There is no single cutoff. Most non-QM borrowers have moderate to strong credit, and credit profile affects lender options. Send me your scenario and I will tell you where you stand.
Can I refinance out of a non-QM loan later?
Often yes. Many borrowers use a non-QM loan to buy now, then refinance into a conventional loan once their tax returns or credit profile catch up. I plan the exit with you from the start.
What are the requirements for a non-QM loan?
Non-QM loan requirements vary by program, but the core is always the federal Ability-to-Repay rule: I document that you can afford the payment. Depending on the program that means bank-statement deposits, assets, or a rental property's income instead of tax returns and W-2s. You also need acceptable credit and a down payment, and the exact amount depends on the program and your file. Send me your scenario and I will lay out exactly what your file needs.
Are non-QM loans more expensive than conventional?
Pricing generally runs higher than conventional, because alternative documentation carries more risk for the lender. It is usually not as dramatic as people fear, and it varies by program, credit, and down payment. For many borrowers the real comparison is not a cheaper loan, it is no loan at all, so the premium is worth it.
Who is a non-QM loan a good fit for?
It fits self-employed and 1099 borrowers, real estate investors, retirees living on assets, foreign nationals and ITIN borrowers, and anyone recovering from a recent credit event. The common thread is real ability to repay that the standard tax-return template does not capture. If a traditional lender has told you no, it is worth a conversation.
Been told no? Let's see if there's a yes.
Send me your situation. I'll tell you which path fits. No judgment. Just math.