Non-QM Jumbo Mortgage Minimum Credit Scores Requirements
This BLOG On Non-QM Jumbo Mortgage Minimum Credit Scores Requirements Was PUBLISHED On June 10th, 2019
Non-QM Loans are portfolio loans that do not have to meet government and/or conventional lending guidelines.
- Non-QM Mortgages were launched a few years ago for the first time after the 2008 Real Estate Meltdown
- After the Real Estate And Banking Collapse of 2008, subprime and alternative financing came to an abrupt halt
- Subprime lenders and portfolio lenders like Washington Mutual went out of business literally overnight. Bank statement loan programs for self-employed borrowers discontinued
- Many self-employed borrowers who relied on bank statement loans with no income tax returns required could no longer qualify for a Jumbo Mortgage
- It was not until Non-QM Mortgages were launched in 2014 that self-employed borrowers could qualify for bank statement loans for self-employed borrowers
- Non-QM Jumbo Mortgage Loans made a comeback
In this blog, we will discuss Non-QM Jumbo Mortgage Guidelines by lenders.
What Are Non-QM Mortgages
Non-QM Mortgages are owner-occupant primary home and investment property real estate mortgage programs that do not have to meet government and/or conventional mortgage guidelines.
- Non-QM Loans do not have any waiting period requirements after bankruptcy and foreclosure
- Non-QM Loans are mortgages for borrowers who do not meet government and/or conforming mortgage guidelines
- There is no private mortgage insurance required on Non-QM Mortgages
- There is no maximum loan limit with Non-QM Loans. Borrowers with late payments in the past 12 months can qualify for a mortgage with Non-QM Loans
- Self-Employed Borrowers can qualify for Non-QM Jumbo Mortgage Loans with credit scores down to 500 FICO
- Bank Statement Mortgages for Self-Employed Borrowers do not require any income tax returns
- Borrowers can qualify for Non-QM Mortgages with late payments in the past 12 months
- This includes mortgage lates
We go by the average monthly deposits of the borrower in the past 12 months.
Jumbo Non-QM Mortgages Versus Traditional Jumbo Loans
Traditional Jumbo Loans require a 700 minimum credit score:
- Traditional Jumbo Mortgages have mandatory waiting period requirements of 7 years after bankruptcy, foreclosure, deed in lieu of foreclosure, short sale
- However, Non-QM Jumbo Mortgage Loans do not have the tough lending requirements
- Traditional Jumbo Mortgages do
- Minimum credit score requirements on Non-QM Jumbo Mortgage Loans is 500 FICO
- The lower the borrower’s credit score the higher the down payment and mortgage interest rate
- There is no minimum waiting period requirements after bankruptcy, foreclosure, deed in lieu of foreclosure, short sale
- There is no private mortgage insurance required
- Down payment requirements on Non-QM Jumbo Mortgage Loans is 10% to 25%
- The higher the borrower’s credit scores, the lower the down payment requirement
- The lower the borrower’s credit scores, the higher the down payment requirement
- The lower the credit scores and down payment, the higher the mortgage interest rates on Non-QM Jumbo Mortgage Loans
- Most Traditional Jumbo Lenders will require a maximum of 43% debt to income ratios
However, with Non-QM Jumbo Mortgage Loans, maximum debt to income ratio requirements is 50% DTI.
Borrowers who may have additional questions on this blog and/or other topics, please contact us at Gustan Cho Associates at 262-716-8151 or text us for faster response. Or email us at email@example.com. The Team at Gustan Cho Associates Mortgage Group is available 7 days a week, evenings, weekends, and holidays.