A Non-QM (Non-Qualified Mortgage) is a type of loan that does not meet the criteria or "qualifications" set forth by the Consumer Financial Protection Bureau (CFPB) for conventional mortgages, often referred to as Qualified Mortgages (QM). The primary difference between non-QM loans and conventional loans lies in how the borrower is underwritten. In all cases the lender is required to demonstrate that the borrower has the ability to repay. Non-QM Loans are typically suited for borrowers who are self- employed, business owners, gig workers, those for whom commissions are a significant (or all) of their earnings, investors, foreign nationals for investment properties, and for borrowers who may have moderate current earned income but hold significant liquid assets. Conventional loans require specific documentation of income, assets, and employment history typically as reflected inW-2 forms, pay stubs, filed Federal tax returns, and other financial records. Non-QM loans may offer alternative documentation options such as the use of bank statements, asset-based income verification, profit & loss statements or other alternative proof of income and/or assets.
USDA Loan Program
A USDA home loan is a zero-down payment mortgage backed by the U.S. Department of Agriculture, designed for eligible homebuyers in rural and certain suburban areas. It is offered through the USDA Rural Development Guaranteed Housing Loan Program. To qualify, the property must be in a USDA-approved rural area—typically outside major cities, with fewer than 35,000
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