1099 Mortgage Loan Programs
Non-QM (Non-Qualified Mortgage) 1099 mortgage loan programs are designed for self-employed borrowers who receive 1099 income and may not meet the traditional mortgage qualification criteria. Here are some key points borrowers should know about these programs:
1099 Mortgage Loan Highlights
- Eligible Borrowers: Non-QM 1099 mortgage loan programs are specifically tailored for self-employed individuals who receive income reported on IRS Form 1099. This includes freelancers, independent contractors, consultants, and small business owners.
- Documentation Requirements: Since self-employed borrowers often have non-traditional income documentation, Non-QM 1099 mortgage loan programs may be more flexible in terms of income verification. While traditional mortgages require two years of tax returns, these programs may consider alternative documentation such as bank statements, profit and loss statements, or CPA letters to verify income.
- Property Types: Non-QM 1099 mortgage loan programs generally allow a range of property types. This can include primary residences, second homes, and investment properties. However, specific guidelines may vary between lenders, so it's important to check with individual lenders or mortgage brokers for their property type requirements.
- Maximum Loan-to-Value (LTV): The maximum loan-to-value ratio represents the percentage of the property's value that can be financed through a mortgage. Non-QM 1099 mortgage loan programs typically offer more flexible LTV ratios compared to conventional mortgages, with maximum LTVs often ranging from 75% to 90%. However, this can vary depending on the lender and the borrower's financial profile.
- Credit Considerations: Non-QM 1099 mortgage loan programs may be more lenient in terms of credit requirements compared to traditional mortgages. While good credit is still important, these programs may consider borrowers with lower credit scores or non-traditional credit histories. Each lender will have its own credit score requirements, so it's advisable to inquire with different lenders to determine their specific guidelines.
- Interest Rates and Costs: Non-QM mortgage loans, including the 1099 program, typically come with higher interest rates compared to traditional mortgages. This is because they involve higher risk due to the unique circumstances of self-employed borrowers. Additionally, borrowers should be aware of any associated fees, such as origination fees, closing costs, or higher down payment requirements, which can vary between lenders.
Non-QM Loan Program Terms:
- Up to 90% LTV Purchase with No MI
- Up to 80% LTV Cash Out
- 599 Min FICO
- Self Employed Programs: 1099, Bank Statements, P&L
- 30 Year Fixed & 40 Year Interest Only Available
- Up to $3M Loan Amount
- 1-4 Units, Condos, Manufactured Homes, Rural
- Up to 55% DTI