Why Mortgage Brokers Should Consider Non-QM Loans for Self-Employed Borrowers
Non-QM loans are becoming an increasingly popular option for mortgage brokers helping self-employed business owners. These borrowers might not fit the traditional underwriting guidelines of a qualified mortgage, so non-qualified (non-QM) loans offer more flexibility and leniency for their financial situations, such as fluctuating income or a high level of debt.
Benefits of Non-QM Loans for their Self-Employed Borrowers
- Less restrictions - One of the main benefits of non-QM loans is that they do not have the same restrictions as QM loans. For example, QM loans have strict debt-to-income (DTI) ratios, which limit the amount of debt that a borrower can have in relation to their income. Non-QM loans, on the other hand, allow higher DTIs.
- More flexibility - Non-QM loans often have more flexible income verification requirements. Self-employed borrowers may have a difficult time providing traditional proof of income, such as pay stubs or W-2s. Non-QM lenders like FundLoans accept alternative forms of income verification, such as bank statements, profit & loss statements, and assets, in addition to full doc.
- Good option for fluctuating income - Non-QM lenders are able to make exceptions for borrowers. Even without a steady income, many individuals can still afford a home. FundLoans prides itself on offering mortgages that make sense.
In summary, mortgage brokers should consider non-QM loans as they can be a great option for self-employed borrowers who may not fit conventional underwriting guidelines. These loans offer more flexibility, can offer exceptions, and may have more flexible income verification requirements. Learn more about FundLoans’ programs.