A non-qualified mortgage (non-QM) loan is for homebuyers who don’t meet the requirements for conventional, FHA, or other qualified mortgages. Non-QM mortgages are most popular with self-employed borrowers. Non-QM loans use alternative methods to verify income.

Benefits of NOn-QM Loan

Conventional loans don’t work for every borrower, including those who are self-employed. River City Mortgage offers non-QM loans for these borrowers.

Unlike QM loans, non-QM loans are not backed by Fannie Mae, Freddie Mac, the FHA, or the VA. As a result, borrowers do not have to follow the requirements set by these entities.

Get Approved for a Non-QM Loan


Minimum credit score of 680


Higher debt-to-income (DTI) ratios accepted


Less strict qualification requirements


Alternative income verification methods accepted

How It Works

Some homebuyers don’t qualify for QM loans, even if they have the income to make their monthly mortgage payments. Sometimes, a borrower that is self-employed can’t produce the income documents needed for traditional loans.

For these borrowers, non-QM loans exist to fill this need, allowing them to use alternative income verification methods such as bank statements, asset statements, or 1099 forms.

These types of borrowers might include:

  • Self-employed individuals
  • Small business owners
  • Retirees
  • Real estate investors
  • Those seeking interest-only payments
  • Those who recently experienced bankruptcy or foreclosure
  • Those with high DTI ratios

Non-QM loans can be used to purchase primary or secondary properties or investment properties.

Loan term lengths are 30-year or 40-year with a fixed rate.

To qualify you’ll need the following:

  • One or two years of bank statements or 1099s, or
  • Three months of asset statements
  • Employment verification from current contract employer
  • Minimum credit score of 680

Required DTI ratios vary depending on which form of income verification you choose.

Depending on your credit score, property type, and income verification methods, River City Mortgage can provide up to 90% financing on loan amounts up to $3 million.

Is a Non-QM Loan Right for You?

These answers to home buyer’s commonly asked questions may help guide you. To take the next step, our loan officers can help you choose the most affordable loan for your home.

Do I qualify for a non-QM loan?

Borrowers who qualify for River City Mortgage’s non-QM loans are able to provide one to two years of bank statements or 1099 forms, or a combination of bank statements, W-2s and 1099s.

A 4506-T is required with a transcript for the 1099s.

Borrowers must be able to provide verification of employment from a current contract employer, covering the most recent earnings and likelihood of continued contract status.

If you are using assets, you must provide your three most recent asset statements.

You also must have a credit score of at least 680.

We know that self-employed borrowers have the income and assets needed for a mortgage, and their employment shouldn’t be something that prevents that. That’s why River City will work with you on a non-QM loan.

What is required if I am a self-employed borrower?

As a self-employed borrower, you may be asked for two years worth of bank statements.  Credit requirements are flexible for self-employed borrowers but should be at least 580 or higher, depending on how much of a loan you’re applying for. 

Personal and business loans are available for self-employed borrowers.

Is a non-QM loan better for me than a conventional or FHA loan?

Non-QM loans are designed for non-traditional borrowers who wouldn’t qualify for a conventional or FHA loan.

Conventional and FHA loans have certain requirements, including documentation of consistent income and employment history, that some borrowers are unable to provide.

However, these borrowers have the income or assets to make their monthly mortgage payments. That’s where non-QM loans come in.

Your River City Mortgage lender will work with you to help you find the perfect loan for your situation.

Is there a maximum amount I can borrow with a Non-QM Loan?

Depending on your credit score, you can borrow up to $3 million, with up to 90% financing.

Can I refinance a non-QM loan?

Yes, rate-and-term refinancing and cash-out refinancing are available to those with non-QM loans.

Your River City Mortgage lender can help you determine when refinancing is a smart move.