The Non-QM world (Non Qualified Mortgage) is for you if you feel restricted and capped by Conventional Fannie Mae/Freddie Mac rules regarding investment real estate lending.
Beverly Hills Mortgage Brokers have listed below the drawbacks and benefits of Non-QM loans/lenders.
What are Non-Qualified Mortgage Lenders/Loans?
Non-QM (non qualified mortgage) lenders cannot be bank depository lenders. These companies are not subject to the traditional Fannie Mae/Freddie Mac regulations. These companies are investors in business real property who have additional needs than the Conventional lending market.
In the Non-QM World, we do not compute personal. DTI (Debt Ratio) is used to calculate personal taxes and personal income. Non-QM loans can be obtained by anyone who isn’t employed and hasn’t filed taxes. You can!
Non-QM lenders will only focus on these criteria when they approve your deal:
1. The property’s ability generate cash flow to pay its debts or its ability to appraise. ARV This will pay the debt if you flip.
2-The maximum credit limit for the borrower (660 or higher, preferable 700).
3. Your liquidity (Does the property have at least 3 to 6 months worth of liquid assets?
That’s all! That’s it!
8 ADVANTAGES OF QUANTUM MILLION LENDERS/LOANS
- Can lend to legal entities (i.e. LLC , Corp etc. ), Family Trusts etc.
- Can consolidate various mortgages into ONE portfolio loan
- No mortgage insurance
- Can be used to finance BOTH Commercial Residential (5+ units) and Commercial Business (retail/office or warehouse, etc.).
- Maximum 5-Loan Amounts: $45K for residential and $5M commercial.
- You don’t have to be employed or make a living to apply.
- There are no limits to how many mortgages you can have
- Cross collateralization property is possible in certain cases
4 DISADVANTAGES OF QUANTUM M Lenders/Loans
- 20% down payment
- In general, the lender will charge 2 points or more
- If your credit score falls below 700, or the property is in foreclosure, you may be eligible for a slightly higher interest rate. DSCR A ratio of debt service coverage that is lower than 1.3
- Show at least 3 to 6 months of liquidity left after closing on the property