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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Free to set up. No credit card.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
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