Lending
Non-QM and Bank Statement Loans in the Sacramento Region
Bank statement, profit and loss, DSCR and hard money loans for income that doesn't fit the usual boxes.
Talk to Maggie directly: cell (916) 549-3131 (text or call) · maggie@loveyoursurroundings.coMaggie B. Hopkins, NMLS #349517 · Surroundings NMLS #2528307
What is a Qualified Mortgage?
A Qualified Mortgage, or QM, is a loan built with safer features. The Consumer Financial Protection Bureau (CFPB) explains it on its page "What is a Qualified Mortgage?" (last reviewed January 2, 2025). A QM is designed to make it more likely you can afford the loan.
The CFPB lists what a Qualified Mortgage generally can't have:
- An interest-only period, when you pay only interest and don't pay down what you borrowed.
- Negative amortization, where the amount you owe can grow even while you make payments.
- Balloon payments, a larger-than-usual payment at the end of the loan. The CFPB notes these are allowed under certain conditions for loans made by small lenders.
- A term longer than 30 years.
A QM also has limits on upfront points and fees, and those limits depend on the size of the loan. For larger loans, the cap is 3% of the loan amount. The lender must also check and verify your income or assets and your debts.
Why "qualified"? A loan that meets these rules gets certain legal protections for the lender, because the lender is presumed to have checked that you can repay. The CFPB adds that all loans backed by FHA, VA and USDA count as qualified loans.
What is a Non-Qualified Mortgage?
A Non-Qualified Mortgage, or Non-QM, is a loan that doesn't meet the CFPB's Qualified Mortgage rules. That doesn't make it a bad loan. It means the loan was built for a situation the standard rules don't fit.
Non-QM loans are often used by borrowers with income that changes from month to month or doesn't show up neatly on a tax return. They can also fit investors who would rather qualify on the property than on personal income. Some carry features a QM can't have, like interest-only payments, a term longer than 30 years or higher points and fees.
Because these loans carry more risk for the lender, they're usually priced to match. That makes comparing several lenders even more important, and it's why we lay the costs out in dollars before you choose.
Which Non-QM loans can a broker arrange?
- Bank statement loans. Your income is shown with bank statements instead of tax returns. Self-employed borrowers often use them when write-offs make their tax returns look smaller than their real cash flow.
- Profit and loss (P&L) loans. Your income is shown with a profit and loss statement for your business, sometimes along with bank statements.
- Debt service loans (DSCR). These are made for rental property. The lender looks at whether the property's rent covers its payment, rather than leaning on your personal income.
- Hard money loans. These are short-term loans from private lenders, based mainly on the property. Investors use them for fixers or purchases that need to close fast, usually planning to sell or refinance later. They tend to cost more than other loans.
Each lender sets its own rules for these programs, and the rules vary a lot. That's exactly where a broker who compares a network of approved lenders earns their keep.
Is a Non-QM loan right for you?
Sometimes yes, sometimes no. If a standard loan works for your situation, it's usually worth comparing first. If it doesn't, a Non-QM loan can be the bridge to the home or investment you want.
We'll show you both side by side when both are possible: the rate, the costs at closing and what the loan looks like over the years you plan to keep it. Then you decide. If you're buying a rental, our investment property page covers the real estate side.
How do you start a Non-QM loan?
Fill out the loan options form or call Maggie's cell at (916) 549-3131. Tell us how you earn your income and what you're buying or refinancing.
It helps to have these on hand: recent business and personal bank statements, a recent profit and loss statement if you have one, and for a rental, the lease or expected rent. We'll tell you if anything else is needed.
Frequently Asked Questions
What is the difference between a Qualified and a Non-Qualified Mortgage?
A Qualified Mortgage meets the CFPB's rules: no interest-only period, no negative amortization, no term over 30 years, limits on points and fees, and verified income or assets. A Non-Qualified Mortgage doesn't meet those rules, usually because it was built for income or a property that doesn't fit them.
Can I get a mortgage if I'm self-employed?
Often, yes. Many self-employed borrowers qualify for standard loans with tax returns. If your tax returns don't show your real cash flow, a bank statement or profit and loss loan may be worth comparing.
What is a DSCR loan?
It is a debt service loan for rental property. The lender looks mainly at whether the property's rent covers its payment, instead of your personal income.
Are Non-QM loans more expensive?
They usually cost more than a comparable standard loan, because the lender takes on more risk. We compare several approved lenders and show you the costs in dollars so you can decide if the trade-off is worth it.
What is a hard money loan used for?
It is short-term financing based mainly on the property, often for a fixer or a purchase that needs to close fast. Most borrowers plan to sell or refinance into a longer-term loan.
Talk to Maggie directly: cell (916) 549-3131 (text or call) · maggie@loveyoursurroundings.coMaggie B. Hopkins, NMLS #349517 · Surroundings NMLS #2528307
Loans are arranged through Maggie B. Hopkins, NMLS #349517 · Surroundings NMLS #2528307. This is not a commitment to lend. All loans subject to credit approval and property qualification. Equal Housing Lender.
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