Non-QM Loans Are on the Rise in PA and FL

What You Need to Know About These Flexible Financing Options

In today’s shifting housing market, more borrowers are turning to non-QM (non-Qualified Mortgage) loans as a flexible alternative to traditional lending. Whether you’re a real estate investor, self-employed borrower, or someone with non-traditional income documentation, non-QM loans can provide a path to homeownership or investment portfolio growth when conventional loans fall short.

In a recent MPA article, our CEO Yury Shraybman discussed the growing popularity of non-QM loan products, particularly in competitive markets like Philadelphia, Pennsylvania. The article highlights how mortgage brokers are increasingly turning to non-QM solutions to meet the needs of borrowers who may not fit into traditional lending guidelines—especially in a market defined by rising home prices and limited inventory. These flexible loan options are helping more clients access financing sooner, even in challenging conditions.

What Are Non-QM Loans?

Non-QM loans are designed for creditworthy borrowers who don’t meet standard underwriting guidelines for qualified mortgages. This could include:

• Self-employed individuals who don’t show enough income on tax returns
• Real estate investors with multiple properties
• Borrowers with recent credit events or non-traditional income
• High net worth individuals looking for asset-based options

Rather than using a rigid, one-size-fits-all approach, non-QM lenders evaluate a broader financial picture. This includes things like bank statements, rental income, or asset depletion strategies to determine eligibility.

The Rise of DSCR Loans for Investors

One of the most popular non-QM products right now is the DSCR loan — short for Debt Service Coverage Ratio. These loans are tailor-made for real estate investors because they’re based on the cash flow of the property, not the borrower’s personal income.

Here’s how they work:

• Lenders look at the monthly rental income generated by the property and compare it to the monthly mortgage payment.
• If the income covers the payment (typically a 1.0+ DSCR), you may qualify —without needing W-2s, pay stubs, or tax returns.
• DSCR loans are ideal for both seasoned investors and newer buyers looking to grow their portfolio with less red tape.

In a competitive market like Pennsylvania—or hot areas in Florida—DSCR loans have become increasingly attractive. As home prices and rental rates rise, these loans help investors act quickly without jumping through traditional income documentation hoops.

Why Non-QM Loans Are Gaining Momentum

A few years ago, non-QM loans were considered a niche product with longer processing times and higher rates. But things have changed dramatically. Turn times are now comparable to conventional loans, and rates have become far more competitive thanks to increased lender participation.

The article highlights the growing demand for non-QM products, particularly bank statement loans for primary residences and DSCR loans for investment properties. Many of the outdated challenges once associated with non-QM financing—like long turn times and limited options—are no longer a concern. With more lenders entering the space, pricing has become more competitive and closings are now faster and more efficient, making non-QM an increasingly attractive option for a wider range of borrowers.

Key Benefits of Non-QM Loans

• ✅ Flexible Income Documentation (bank statements, DSCR, assets)
• ✅ Ideal for Self-Employed or 1099 Borrowers
• ✅ Works for Credit-Challenged or Recently Recovered Borrowers
• ✅ Can Help Investors Scale Quickly Without Personal Income Limits
• ✅ Quick Turnaround Times

The Bottom Line

If you’re looking to buy or invest in real estate but feel boxed out by traditional mortgage requirements, non-QM loans may be the right fit. Products like DSCR loans make it easier than ever to finance investment properties based on rental income alone, while bank statement loans can help self-employed borrowers qualify without tax return limitations.

As always, the key is working with a knowledgeable mortgage professional who understands both non-QM products and your unique financial situation.

To read more about the growth of non-QM loans in the Philadelphia market, check out the full article from MPA here:
👉 Read the full story

If you’re exploring your options in Pennsylvania (PA) or Florida (FL) or wondering whether a non-QM loan is right for you, reach out today. We’ll walk you through the process and help you find the best solution for your goals.