Non-QM loan
A loan that doesn't meet the qualified mortgage rules. Common for self-employed borrowers who qualify on bank statements instead of tax returns. Rates are usually higher.
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See how it worksWhere this comes up: on the market
Part 1 of 4
Why a seller cares
A self-employed buyer may be using a non-QM loan that qualifies on bank statements. It is a real loan with a longer underwriting tail, so the financing contingency window tends to run longer.
Part 2 of 4
A simple example
A buyer who owns a landscaping business offers $300,000 with a bank-statement loan. The lender wants 24 months of statements and 35 days to close.
| The loan | What tends to be different |
|---|---|
| Non-QM, bank statement | More documents, a higher rate for the buyer, a longer timeline |
| Conventional | Tax returns and pay stubs, a faster path |
| Either | The same appraisal and the same closing table |
Non-QM opens a loan to buyers whose income does not fit the form, at the cost of time.
Part 3 of 4
What people get wrong
That non-QM means subprime. It means the income is documented differently, and the buyer is often well off.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · drawn from the reference glossary · how we research and check what we publish
In your Room, this word explains itself where it appears.
Your Room defines non-qm loan in the step you meet it in, beside the document or the date it belongs to. Free to set up, with an agent or on your own.
Organize my saleFree to set up. Pay once when you list: $89 or $189. 7-day refund.