How Young Professionals are Becoming Homeowners with Non-QM Loans
For many young professionals, the dream of homeownership seems impossible. But with the help of non-QM loans, it’s becoming more and more achievable. Non-QM loans are mortgages that don’t require borrowers to meet traditional lending criteria, such as high credit scores or large down payments. This makes them ideal for people who may have struggled in the past to get a loan or for those who want to buy a bigger home than they could afford with a traditional mortgage. So if you’re ready to take the plunge into homeownership, talk to your lender about getting a non-QM loan. You may be surprised at how affordable it can be!
First off, let’s start with the basics. What is a Non-QM Loan. A Non-QM Loan or Non-Qualified Mortgage is
How young professionals are stepping into homeownership despite student loan debt
Young professionals are now choosing to delay homeownership due in part from increasing student loan debt. These loans often keep these individuals out of the housing market, but there is hope for those who suffer underwriting guidelines that prevent them from qualifying because their income isn’t high enough and they cannot meet prescribed monthly payments with what little savings or earned cash flow available each month .
The trend shows an increase among 25-year old’s delaying becoming a homeowner; however, it’s mainly been seen among people aged 35 years old or older where ownership rates have dropped dramatically since before 2009–the year following The Great Recession which hit America hard economically speaking.
Homeownership is a dream many people hold onto for years, but it can be challenging when you owe more than your house is worth. There’s no shame in admitting that student loans might have prevented you from buying a home; thankfully there are other options available! Loan products such as Non-QM mortgages can provide interest rates lower than traditional programs because they don’t require borrowers meet certain criteria (like having good credit). These products can help the underserved group of young professionals.
Young professionals are often in good financial standing and have excellent credit scores, but they sometimes struggle with the complex process of buying their first home. Luckily there’s a solution: Non-QM loans! These special types of mortgage go above and beyond what most lenders look for when qualifying you as an applicant – which means that if you’re lucky enough to qualify on one them anyway (and we think success is practically guaranteed), then this could be just what your wallet needs after all those expensive student debts finally come off schedule next year.
The average young professional earns about $71,000 per year in the United States. However recently we are seeing a trend upwards in the amount young professionals are making per year. This may sound like a comfortable amount for any young professional. It is important to note that on average this demographic also has $30,000 in student loan debt. After factoring in this debt, young professionals may not meet debt to income ratios of conventional underwriting guidelines. The prism of borrowing guidelines shows that this ratio is too high for many conventional home loans. So, by this standard, while the borrower may not qualify for a traditional home loan, they may be an excellent candidate for a Non-QM loan.
Bottom Line
Non-QM loans are mortgages that don’t require borrowers to meet traditional lending criteria, such as high credit scores or large down payments. This makes them ideal for people who may have struggled in the past to get a loan or for those who want to buy a bigger home than they could afford with a traditional mortgage. So if you’re ready to take the plunge into homeownership, talk to your lender about non-QM options. You may be surprised at how much easier it is to get approved for a non-QM loan than you thought possible. When you're ready to begin you home finance journey give us a call today!