Non-QM stands for Non-Qualified Mortgage — loans that fall outside the conventional Fannie Mae and Freddie Mac guidelines that require W-2 income, tax returns, and debt-to-income ratios under 43%. Non-QM loans are not subprime products. They are sophisticated lending programs designed for sophisticated borrowers whose financial reality doesn't map cleanly onto conventional underwriting criteria. Florida is one of the most active non-QM markets in the country, driven by a large self-employed population, significant real estate investor community, and substantial foreign national investor activity.
Florida Non-QM Loan Programs
The main non-QM loan programs available in Florida:
DSCR Loans
Qualify investment properties on rental income. No personal income documentation. Most popular non-QM program for Florida investors. 1-4 unit, STR, LLC-vested. Min DSCR 1.0, min 620 credit, 20-25% down.
Bank Statement Loans
Self-employed Florida borrowers use 12-24 months of deposits instead of tax returns. Both investment properties and primary residences. Covers business owners whose write-offs reduce taxable income below conventional qualifying thresholds.
Business Purpose Loans (BPL)
Entity-based loans made to LLCs and corporations secured by Florida real property. Consumer mortgage regulations do not apply — more flexible underwriting. Ideal for LLC investors who want the cleanest separation between personal and investment financing.
Asset Depletion / Asset Utilization
For high-net-worth Florida borrowers with substantial liquid assets but limited W-2 income. Lender mathematically converts assets to qualifying income. Common for retirees and wealth-stage investors.
Foreign National Programs
Florida's large international investor market drives significant demand. No US tax history or credit required. Primarily DSCR-based qualification.
Who Uses Non-QM Loans in Florida
Florida's non-QM borrower profile is broad:
- Real estate investors with 3+ properties — Conventional DTI limits and 10-property caps push most active investors to DSCR.
- Florida small business owners — Significant self-employment in tourism, construction, healthcare, and professional services creates a large bank statement loan market.
- Short-term rental operators — Florida's Airbnb market is massive. STR income doesn't fit conventional underwriting — DSCR STR programs solve this.
- Foreign nationals — Miami, Tampa, and Orlando attract significant Latin American, European, and Canadian investors who need US financing without US tax history.
- Retirees with investment portfolios — Limited W-2 income but strong assets. Asset depletion programs qualify them.
- High-income professionals with complex returns — Physicians, attorneys, and executives with S-corps, K-1s, and partnership income that conventional underwriters struggle to process.
Non-QM vs Conventional — Florida Rate Reality
Non-QM rates in Florida carry a premium over conventional, but the gap is often smaller than investors expect:
- Conventional investment property rates include significant Loan Level Price Adjustments (LLPAs) that add 0.5-1.5% to the base rate
- DSCR rates at 7.0-7.75% vs conventional at 6.5-7.25% = real gap of 0.25-0.75% for most profiles
- Bank statement rates at 7.5-9.0% vs conventional at 7.0-8.0% for primary residences
- The flexibility, speed, and lack of documentation burden frequently justifies the small rate premium
Frequently Asked Questions
A Non-Qualified Mortgage (non-QM) is any loan that falls outside Fannie Mae/Freddie Mac conventional guidelines. Non-QM loans include DSCR (rental income qualification), bank statement (deposit-based income), BPL (business entity loans), and asset depletion programs. They are legal, widely available, and designed for borrowers whose financial situations don't fit conventional criteria.
Yes. Modern non-QM loans are legitimate, regulated mortgage products originated by licensed professionals and funded by institutional non-QM lenders. They are not the "liar loans" of the pre-2008 era. They have real qualification standards — they just use different documentation than conventional loans.
Hard money loans are short-term (6-18 months), asset-based, high-rate financing for acquisitions and rehabs. Non-QM loans are long-term (30-year) financing with real qualification standards — they just don't use W-2s and tax returns. DSCR is a non-QM loan; it is not hard money.
Minimums are similar to conventional — most non-QM programs start at 620. Competitive pricing typically requires 660-680+. Some programs accept lower scores with lower LTV and higher rates.
Yes. DSCR, bank statement, BPL, and foreign national programs are all available through Viador Partners in Florida. Chad Evers holds Florida mortgage origination licensing and actively originates non-QM loans statewide.
Yes — bank statement loans and asset depletion programs are available for Florida primary residences for self-employed and wealth-stage borrowers. DSCR loans are investment-property only.