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When should you choose a Non-QM Home Loan. Probably the best time to utilize a Non Qm loan is when you don’t meet the requirements of a qualified bank mortgage or a conventional loan. Not everyone is a perfect fit to the loan standards of qualified government or bank loans, and that is perfectly fine. Though utilizing a Non-QM Loan will have different terms, both some good and bad, once you close, a non qm loan will allow you to achieve your goal. The most common reasons we see an individual or family go with Non-QM Loans are:

Self-employment which causes difficulties with other loan options. There are often lots of hoops to jump through and restrictions that are put in place that make it difficult for individuals who are self-employed to secure a conventional or bank loan.

Having too many multi-unit rentals. For most conventional lenders, the limit for multi-unit investment properties is 10 or less. Non-QM is a great option in this case as there are a number of Non-QM Loan lenders who will finance the property as long as the incoming rent covers the mortgage, no proof of other income needed. 

Having bad credit. For a lot of standard loans, they usually require no major negative impact on your credit in the past 7 years. However, after such an event like a bankruptcy or foreclosure, a borrower only has to wait around 24-48 before they are able to apply for a Non-QM Loan.