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Non-QM Loans Options

Non-QM Loans: Flexible Mortgage Options Beyond Traditional Guidelines

Non-QM loans are designed for borrowers who do not fit traditional mortgage guidelines.

Millions of well-qualfiied borrowers are turned down every year by traditional lending such as conventional, FHA, VA and USDA loans.

These alternative mortgage loans can help self-employed borrowers, real estate investors, business owners, high net worth, and borrowers who need a mortgage without traditional tax return qualification explore financing based on their real financial picture.

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Self-Employed Friendly
Investor Loan Options
Alternative Documentation
Licensed in AL, GA, FL, TX & SC

Types of Non-QM Loan Options Offered With Andes Mortgage LLC

Bank Statement Loans
DSCR Loans
Asset Depletion Loans
1099 Loans
P&L Loans
Non-QM Jumbo
Foreign National Loans

What Is a Non-QM Loan?

Not every borrower fits into traditional mortgage guidelines.
You may be self-employed, own a business, invest in real estate, receive 1099 income, have significant assets, or have income that does not show clearly on a standard W-2 or tax return. That does not automatically mean you cannot qualify for a mortgage.
A Non-QM loan, short for non-qualified mortgage, is a mortgage that allows more flexible ways to qualify outside of standard conventional or government loan guidelines.
Instead of relying only on pay stubs, W-2s, and tax returns, Non-QM loans may allow borrowers to qualify using bank statements, rental income, profit and loss statements, 1099 income, business income, or qualifying assets.
That flexibility is why Non-QM can support a self-employed mortgage strategy, investor loans, 1099 mortgage loans, and other scenarios where strong borrowers need documentation options beyond the standard agency model.
These loans can be especially helpful for self-employed borrowers, business owners, real estate investors, retirees, foreign nationals, and borrowers with complex income. They can also be a solution for borrowers who have experienced past credit events such as bankruptcies, foreclosures, or short sales but have recovered financially, have significant income, and can make a larger down payment.
However, flexibility can come with trade-offs. Non-QM loans may have different credit, down payment, reserve, rate, and cost requirements depending on the loan program and borrower profile.
At Andes Mortgage, we help you compare traditional and Non-QM mortgage options so you can find the loan that fits your real financial situation, not just what appears on paper.

Not About Bad Credit

Many Non-QM borrowers are financially strong but do not fit traditional underwriting boxes.

Alternative Documentation

Qualify using bank statements, rental income, assets, 1099 income, P&L statements, or other documentation.

Flexible Underwriting

Non-QM loans focus on the borrower's full financial picture and the specific loan scenario.

Why Borrowers Choose Non-QM Financing

Many borrowers look into Non-QM financing because traditional mortgage guidelines do not tell the full story.

Self-Employed

Show income your way with bank statements, P&L statements, or other alternative documentation.

Business Owners

Designed for entrepreneurs whose tax returns may not reflect the true cash flow of the business.

Real Estate Investors

Use investor-focused options such as DSCR loans to qualify based on property income.

High Net Worth

Leverage qualifying assets when traditional monthly employment income is limited.

Foreign Nationals

Explore U.S. mortgage options even without standard U.S. income or credit documentation.

ITIN/Tax ID

Explore U.S. mortgage options even without standard U.S. income or credit documentation.

Complex Income

Helpful for borrowers with seasonal, commission, bonus, 1099, or irregular income.

Credit Events

Helpful for borrowers with seasonal, commission, bonus, 1099, or irregular income.

Not sure which program is the right one for your situation? 

Find It With Mortgage Match™️

Pros & Cons of Non-QM Loans

Non-QM loans can be powerful when traditional mortgage guidelines do not fit, but they are not always the cheapest or easiest option. Here’s how to think about the trade-offs.

Benefits of Non-QM Loans

  • Flexible income documentation
    Qualify using bank statements, rental income, 1099 income, profit and loss statements, business income, or qualifying assets.
  • Helpful for self-employed borrowers
    Business owners may qualify even when tax returns do not show their full cash flow because of deductions or write-offs.
  • Investor-friendly options
    Programs like DSCR loans may allow real estate investors to qualify based on the property's rental income.
  • Options after past credit events
    Some programs may offer more flexible guidelines for borrowers who have recovered financially after a bankruptcy, foreclosure, short sale, or other credit event.
  • Useful for complex financial situations
    Helpful for borrowers with irregular income, high assets, foreign national status, multiple businesses, or non-traditional documentation.

Trade-Offs to Consider

  • Rates may be higher
    Non-QM loans often come with higher interest rates than conventional or government-backed mortgages because the guidelines are more flexible.
  • Larger down payment or equity may be required
    Depending on the program, borrowers may need more money down or more home equity compared to a standard mortgage.
  • Guidelines vary by lender
    Requirements can change significantly depending on the lender, property type, credit score, documentation, and loan purpose.
  • More reserves may be needed
    Some programs may require borrowers to show additional savings or reserves after closing.
  • Not always the best first option
    If you qualify for a conventional, FHA, VA, or other traditional loan, that may still be the better choice.

Non-QM Loan Requirements

Non-QM loan requirements vary depending on the loan type, lender, property type, credit profile, down payment, and documentation used to qualify.

Because these loans are more flexible, the required documents are usually based on the borrower’s actual scenario. A bank statement borrower, DSCR investor, asset depletion borrower, and foreign national buyer may all have different documentation needs.

Common Documents You May Need

  • Valid photo ID
  • Depending on the program: Bank statements, P&L, 1099s, Asset Accounts, leases, etc.
  • Asset statements
  • Proof of mortgage payments or rental history
  • Profit and loss statement, if applicable
  • Lease or rent schedule, if using DSCR
  • Purchase contract or property information
  • Mortgage statement, if refinancing
  • Credit report
  • Additional documents based on loan type

Non-QM vs Conventional Mortgage

Feature
Non-QM Loan
Conventional Mortgage
Best For
Self-employed borrowers, investors, asset-based borrowers, foreign nationals, and complex income
W-2 borrowers with standard income documentation
Income Documentation
Bank statements, rental income, assets, P&L, 1099 income, or alternative documentation
Pay stubs, W-2s, tax returns, and standard income documents
Tax Return Flexibility
May not require traditional tax return qualification
Often relies heavily on tax returns or standard income documents
Investor Options
Strong DSCR and cash-flow-based options
More personal-income focused
Rates & Costs
Often higher than standard conventional options
Usually lower if the borrower fits guidelines
Best Use Case
When the borrower is strong but does not fit traditional guidelines
When the borrower clearly fits standard agency guidelines

A conventional mortgage may be the better option when you qualify cleanly using standard income, credit, and debt-to-income guidelines. A Non-QM loan may make more sense when your financial picture is strong but does not fit the traditional underwriting model.

If you’re not sure about which loan is the right one for you, we have created a nifty tool that can help you match the best loan for your personal situation. Click the button below and get Mortgage Matched! 

Find It With Mortgage Match™️

Recent Borrower Scenarios

Scenarios are examples only. Loan approval depends on full underwriting review.

Self-Employed Business Owner

Profile: General Contractor who needed $150,000 equity access of his current primary home to expand his business. 

Challenge: Strong business deposits, but tax returns did not show enough qualifying income.

Solution: Bank Statement Loan

How it played out: Daniel had been turned away by several banks and lenders due to his tax return structure – Although the business was highly profitable, his tax returns had a large amount of deductions which hurt his personal income, stoppping him from conventional financing. 

He came to us looking for alternative solutions. We immediately looked into a Bank Statement Loan as the right solution for him and it turned out to be! His business deposits were roughly $800,000 over a 12 month period which allowed us to calculate an effective income of ~$30,000 per month assuming a 50% business expense factor. 

We were able to help him access the cash he needed thanks to this Non-QM Loan, specifically the Bank Statement Loan which allowed him to invest in his business. 

Real Estate Investor

Profile: W2 employee with multiple rental properties in his portfolio

Challenge: W2 income was not sufficient enough to continue financing rental properties with traditional financing. 

Solution: DSCR Loan

How it played out: Juan has become one of our most loyal clients over the years thanks to our “outside-the-box” thinking to help him acquire nearly 7 rental properties since 2020. 

Although he’s had a steady job for years, his personal W2 income just wasn’t sufficient enough to continue to acquire more rental properties with a conventional mortgage. Additionally, two of his properties needed repairs and those deductions were included in the Schedule E section of his personal tax returns. Ultimately, showing a loss for the year. 

He wanted to continue to expand his rental portfolio and we immediately looked into our DSCR Loan program which requires no personal income, tax returns or debt-to-income ratio. 

We were able to help him finance 3 more properties, closing within 20 days and to this day, he continues to use our DSCR loan program for acquisition and refinancing.

Non-QM Loan Process Timeline

1

Consultation

We review your goals, income, assets, property type, and loan purpose.
2

Program Match

We compare available Non-QM options and identify the best fit for your situation.
3

Documentation

We collect the specific documents needed for your loan type.
4

Underwriting

The lender reviews your file using the correct Non-QM underwriting guidelines.
5

Approval & Closing

Once conditions are cleared, your loan moves to final approval and closing.
Book a Non-QM Loan Consultation

Non-QM Loan FAQs

Non-QM loans can be confusing because there are many different programs, documentation options, and borrower scenarios. Here are answers to common questions borrowers ask Andes Mortgage about Non-QM financing.
A Non-QM loan is a mortgage that does not fit standard Qualified Mortgage guidelines. These loans may allow alternative ways to qualify, such as bank statements, rental income, assets, 1099 income, or profit and loss statements.
No. Many Non-QM borrowers have strong income, strong assets, or strong real estate experience. They simply may not qualify using traditional mortgage documentation.
Non-QM loans may be a good fit for self-employed borrowers, business owners, real estate investors, contractors, consultants, retirees with assets, foreign nationals, and borrowers with complex income.
In some cases, yes. Certain Non-QM programs may allow borrowers to qualify using bank statements, 1099 income, assets, or other alternative documentation instead of traditional tax returns.
A bank statement loan is a type of Non-QM mortgage that allows eligible self-employed borrowers to qualify using personal or business bank statements instead of traditional tax returns.
A DSCR loan is an investor mortgage that focuses on the rental income and cash flow of the property rather than the borrower’s personal employment income.
An asset depletion mortgage allows eligible borrowers to use qualifying assets as part of the income qualification process.
A 1099 mortgage loan is designed for borrowers who earn income as independent contractors or self-employed professionals and receive 1099 income instead of W-2 wages.
A P&L loan may allow a business owner to qualify using a profit and loss statement instead of full traditional tax return documentation.
A foreign national mortgage is designed for eligible non-U.S. borrowers who want to purchase or refinance property in the United States.
No. Some Non-QM loans are available for primary residences, second homes, and investment properties. The available options depend on the program and borrower profile.
Yes, some Non-QM programs allow cash-out refinances. This can be helpful for self-employed borrowers or investors who have equity but do not qualify through traditional guidelines.
Usually, Non-QM rates and costs can be higher than conventional loans because the underwriting is more flexible and the loan may carry different risk factors.
No. Non-QM loans are not the same as the old subprime loans from before the housing crisis. Today’s Non-QM loans still require underwriting, documentation, and a review of the borrower’s ability to repay where applicable.
Yes, some bank statement loan programs allow business bank statements. The lender may apply an expense factor to estimate qualifying income.
Many bank statement loan programs review 12 or 24 months of bank statements, but requirements vary by lender and program.
Some Non-QM loans may require a larger down payment or more equity than conventional loans, depending on credit, property type, occupancy, and documentation.
Possibly. Many borrowers explore Non-QM loans after being denied by a traditional lender because their income, tax returns, or property type did not fit standard guidelines.
Yes. Non-QM loans can be valuable for Realtors working with self-employed buyers, investors, foreign nationals, or clients with complex income.
The best Non-QM loan depends on your income type, property type, credit profile, assets, down payment or equity, and loan goal. Andes Mortgage can review your full scenario and compare available options.

Your Income May Be Complex. Your Mortgage Strategy Does Not Have to Be.

If traditional mortgage guidelines do not fit your situation, Andes Mortgage can help you explore flexible Non-QM loan options for self-employed borrowers, investors, business owners, retirees, foreign nationals, and borrowers with unique income.
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Alternative Documentation

Investor-Friendly Options

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