Non-QM · Portfolio Lending

Your Income Is Real. It Just Does Not Fit the Box.

Self-employed and writing off everything you legally can. An investor at the conventional property limit. A physician with six figures of student debt and a signed contract. The money is there. The documentation rules were written for someone else.

Run My Scenario Quick Pre-Qual

Short Answer

Non-QM means a mortgage that sits outside the federal Qualified Mortgage standard, usually because income is verified differently than tax returns allow. It does not mean subprime and it does not mean no underwriting. We run DSCR, bank statement and physician programs, plus jumbo financing above the conforming limit, for Michigan borrowers whose income is real but does not document the standard way.

0.75x

Lowest DSCR
Ratio Available

12 Mo.

Shortest Bank
Statement History

100%

Physician Financing
Up To $1 Million

640

Lowest Credit
Score Accepted

⚠

Confirm these numbers before you rely on them

Non-QM guidelines are investor driven and they change more often than anything else we offer. Every figure on this page is accurate as of the last revision and any of it could move next month. We are not going to pretend a web page stays current on its own. Ask us what today's version says before you write an offer.

Confirm Current Figures Text Angie

What Non-QM Actually Means

QM stands for Qualified Mortgage. It is a federal standard built around documented income, a debt-to-income calculation, and a list of product features a loan is not allowed to have. A non-QM loan is simply one that sits outside that standard.

That is the whole definition. It does not mean subprime. It does not mean stated income. It does not mean nobody checks anything. Every file we place is manually underwritten by a human being who reads it line by line, which is frequently more scrutiny than an automated agency approval, not less.

What changes is how income gets proven. A conventional loan asks for two years of tax returns and uses the number at the bottom. For a lot of people that number is a work of fiction in the other direction: it is what is left after every legal deduction a good accountant could find. Non-QM looks at deposits, or rent, or a signed employment contract instead.

The honest tradeoff

Non-QM loans price higher than agency loans. The file is manually underwritten, it is not backed by Fannie Mae or Freddie Mac, and the investor is accepting documentation that falls outside the standard. That risk gets priced, and rates move daily with the market and with your specific credit, loan-to-value and property type.

So the first question we ask is not which non-QM program you want. It is whether you need one at all. If your tax returns support the debt, conventional is the cheaper loan and we will tell you so.

Start Here: Which Door Is Yours

Most people arrive here having already decided they need something exotic. Usually they are half right. Work down this list in order.

1. Can you document the income conventionally?

If two years of tax returns show enough to carry the payment, stop. Take the agency loan. This applies more often than people expect, particularly to investors who assume rental property requires something special. It does not. See conventional investment property financing and second home loans first.

2. Is the property a rental you will never live in?

Then DSCR is probably your answer. It ignores your personal income completely and qualifies on the property's rent divided by the payment. No tax returns, no debt-to-income calculation. You can close in an LLC. The catch is that it is a business purpose loan, so you cannot occupy the property at all, not even part of the year.

3. Are you self-employed and buying something you will live in?

Then a bank statement loan is the usual door. Twelve to twenty four months of personal or business deposits replace the tax returns. It works on a primary residence, a second home or an investment property, which makes it the most flexible program in this group.

4. Are you an MD, DO, DMD, DDS or DVM?

Then look at the physician loan before anything else, because it is usually better than both the conventional option and the other non-QM options. Up to 100% financing to $1 million, no mortgage insurance at any tier, and student loan debt excluded from the debt-to-income calculation rather than merely reduced.

5. Is the loan amount the problem rather than the income?

Then it is not a non-QM question at all, it is a jumbo question. Jumbo means above the conforming limit, which for 2026 in Michigan is $832,750. Jumbo loans are non-agency but they are frequently still Qualified Mortgages. Different problem, different door.

The Programs

DSCR, for rental property

Qualifies on the property instead of you. Gross rent divided by the full housing payment produces a ratio, and the ratio is the qualification. We run three separate DSCR programs with minimum ratios starting as low as 0.75x and credit scores accepted from 640, with loan amounts to $3 million.

Because we run three, a decline from one grid is not the end of the file. Investment property only, manufactured homes ineligible, and most programs may carry a prepayment penalty of up to five years. Full DSCR detail.

Bank statement, for self-employed borrowers

Twelve to twenty four months of personal or business bank statements in place of tax returns. Business statements typically get an expense factor applied, often around half of gross deposits, while personal statements generally count deposits more directly. Credit from 660, loan amounts to $1 million, typically 10% down or more, with three to six months of reserves. Full bank statement detail.

Physician, for MD, DO, DMD, DDS and DVM

The strongest program in this group if you qualify for it. Financing tiers run to 100% at $1 million, 95% to $1.75 million and 90% to $2.5 million, with no mortgage insurance at any tier. Residents and fellows qualify on a signed employment contract and can close up to ninety days before the start date. Primary residence only. Full physician loan detail.

Jumbo, when the loan is simply large

Above $832,750 in Michigan for 2026. Down payments from roughly 10%, no mortgage insurance at any loan-to-value, and primary, second home and investment all eligible. In Northern Michigan this is mostly a waterfront conversation. Full jumbo detail.

Why Northern Michigan Produces So Many of These Files

This region generates non-QM scenarios at a rate that surprises lenders downstate, and the reasons are structural.

The economy is self-employed. Contractors, charter captains, orchard operations, tradespeople, shop owners, consultants who left a corporate job and came north. A large share of the working population here files a Schedule C, and a good accountant makes that Schedule C look modest.

Seasonal income is normal. A business that earns most of its money between May and October is a perfectly sound business and a difficult conventional file. Twelve to twenty four months of deposits smooths that out in a way two tax returns do not.

Rental property is a core asset class. Between year-round rentals in Traverse City and the cottage market across Leelanau, Antrim and Charlevoix counties, a lot of local wealth is in doors rather than W2s. That is DSCR territory.

Values outrun the conforming limit on the water. Torch Lake, Walloon, Lake Charlevoix, Little Traverse Bay. Plenty of ordinary buyers end up in jumbo territory because of where the house sits, not because of how wealthy they are.

What We Will Not Do

Put you in a non-QM loan you do not need. It costs more. If conventional works, conventional wins, and we would rather tell you that on the first call than at the closing table.

Quote you a rate spread on a web page. Rates change daily and vary with credit, loan-to-value, occupancy and property type. Any number we published here would be wrong by the time you read it.

Pretend a decline is final. We are a correspondent lender with multiple investor programs behind most of these products. One scenario can be run against more than one set of guidelines before anybody pulls credit a second time or pays for a second appraisal.

What to Send Us

You do not need a full application for us to tell you which door you are standing at. Send these and we can usually route you the same day:

What you are buying or refinancing, and roughly what it is worth
Whether you will live in it, live in it part of the year, or never set foot in it
How you earn your money: W2, self-employed, rental income, a signed contract
Your approximate credit score
If it is a rental, the current lease or your best estimate of market rent

That is enough to tell you whether you need any of this at all.

Three Categories People Lump Together

These get called "non-QM" interchangeably and they are not the same thing. Knowing which one you are in saves a lot of wasted conversation.

ACTUALLY NON-QM

Income Documented Differently

DSCR, bank statement and physician loans. These sit outside the Qualified Mortgage standard because income is verified in a non-standard way. Manually underwritten, priced accordingly.

NON-AGENCY, NOT NON-QM

Jumbo

Above the conforming limit, so Fannie and Freddie will not buy it. But jumbo loans frequently still meet the Qualified Mortgage standard. Large is not the same as non-conforming documentation.

PLAIN AGENCY

Investment and Second Home

Rental property and second homes are ordinary conventional products when your tax returns support them. People assume these require something special. They usually do not, and assuming otherwise costs money.

Non-QM Questions, Answered Straight

The ones borrowers actually ask, with the answers we actually give.

What does non-QM actually mean?

QM stands for Qualified Mortgage, a federal standard built around documented income, a debt-to-income calculation and a set of product restrictions. A non-QM loan is simply one that sits outside that standard. It does not mean subprime, it does not mean no underwriting, and it does not mean the lender skips verification. It means income gets verified a different way, usually because tax returns do not reflect what the borrower actually earns.

Is a non-QM loan a bad loan?

No, but it is usually a more expensive loan, and that is the honest tradeoff. These files are manually underwritten and are not backed by Fannie Mae or Freddie Mac, so the investor prices that risk. If you can qualify conventionally on your tax returns, conventional is almost always the cheaper loan and you should take it. Non-QM earns its cost when the agency box genuinely does not fit.

Which program fits a self-employed borrower?

Usually a bank statement loan, which uses 12 to 24 months of deposits instead of tax returns. If the property is a rental rather than a home you will live in, DSCR is often the better door because it ignores your personal income entirely and qualifies on the rent. Many self-employed borrowers in Northern Michigan end up using both over time, one for the house and one for the rentals.

Can I use a non-QM loan for a Northern Michigan second home?

A bank statement loan can be used on a second home. DSCR cannot, because DSCR is a business purpose loan that requires the borrower not to occupy the property at all. If you plan to use a place yourself part of the year and rent it the rest, that is second home or conventional territory, and trying to force it into DSCR is loan fraud.

Do I need a big down payment for non-QM?

It varies widely by program. Bank statement loans typically start around 10% down. DSCR purchase loan-to-value reaches 85% in the strongest credit and ratio tiers, so 15% down in the best case. Physician loans go to 100% financing up to $1 million with no mortgage insurance. There is no single non-QM down payment rule, which is exactly why the program selection matters more than the category.

Will a non-QM loan hurt my chances on a purchase offer?

Only if your agent cannot explain it. A pre-approval on a manually underwritten file is not weaker than an automated approval, but it is less familiar, and listing agents distrust what they do not recognize. We will talk to the listing agent directly if it helps, which in a competitive Traverse City or Charlevoix situation is often the difference.

Are these loans available on manufactured homes?

Generally no. Manufactured and mobile homes are ineligible on all of our current DSCR programs, and non-QM programs broadly treat them as ineligible collateral. Manufactured home financing in Michigan runs through agency programs instead, which generally require owner occupancy.

How long do non-QM loans take to close?

Longer than an automated agency approval, because every one of these files is underwritten by a person rather than a system. Timelines depend on how complete the file is at application, the appraisal, and third party turn times. We will give you a realistic window for your specific scenario rather than a number that makes the offer look good and then slips.

Can I refinance out of a non-QM loan later?

Often yes, and for many borrowers that is the plan. Two years of clean tax returns after a business stabilizes can move someone from bank statement to conventional. The one thing to check first is whether your loan carries a prepayment penalty, which some investment property programs do for up to five years. Ask before you lock, not at the closing table.

Why do some lenders decline these and you do not?

Usually because they run a single program with a single grid. We are a correspondent lender with several investor programs behind each product, which means one scenario can be run against more than one set of guidelines before anybody pulls credit twice. A decline from one grid is one investor's answer, not a verdict on the file.

The Six Programs

Each one has its own page with the full guideline detail, the real numbers, and the questions borrowers actually ask.

DSCR Loans

Rental property qualified on the rent, not your tax returns. Ratios from 0.75x, credit from 640, close in an LLC. Three investor programs.

Bank Statement Loans

Self-employed financing on 12 to 24 months of deposits. Primary, second home or investment. The most flexible program in this group.

Physician Loans

MD, DO, DMD, DDS, DVM. Up to 100% financing to $1M, no mortgage insurance, student debt excluded from DTI.

Jumbo Loans

Above the 2026 Michigan conforming limit of $832,750. Down payments from roughly 10%, no mortgage insurance at any LTV.

Investment Property Loans

Conventional rental financing using your documented income. Check this before DSCR. Usually the cheaper loan when it works.

Second Home Loans

For a place you use yourself part of the year. Occupancy rules make this the right door, not DSCR.

Tell Us the Scenario

What you are buying, whether you will live in it, and how you earn your money. That is enough for us to tell you which program fits, or whether you need one at all.

Run My Scenario Start an Application Call 231-709-3136

Program guidelines subject to change. All program parameters described on this page, including minimum credit scores, loan-to-value limits, loan amounts, documentation requirements and reserve requirements, are investor guidelines that may change at any time without notice. Figures shown represent the range across multiple programs. No single program offers every figure listed and no borrower qualifies for the most favorable figure in every category simultaneously. Contact us to confirm current guidelines before relying on any figure on this page.

Not a commitment to lend. This page is for informational purposes only and does not constitute a loan commitment, pre-approval, or offer of credit. All loans are subject to credit approval, income and asset verification where applicable, property eligibility, satisfactory appraisal, and full underwriting review. Rates and terms change daily and are subject to market conditions. Not all applicants will qualify.

DSCR loans are business purpose loans available on investment property only. The borrower may not occupy the subject property. Cash-out proceeds must be used solely for business purposes. Prepayment penalties of up to five years may apply on some investment property programs and will be disclosed in a separate rider.

Angie Anderson NMLS #1999286. Kirby Slocum NMLS #680817. Union Home Mortgage Corp. NMLS #2229229. Equal Housing Lender. Union Home Mortgage Corp., 8241 Dow Circle West, Strongsville, OH 44136.