Today’s non-QM borrower is harder to define and pinpoint

Self-employed workers, real estate investors, high net worth borrowers, foreign nationals and homeowners with significant equity are increasingly using nonqualified mortgage (non-QM) and other nonagency products across the country. And while California, Florida and Texas remain some of the biggest markets for non-QM lending, the diversified borrower base is becoming increasingly difficult to pinpoint on the map.The market is only growing in size. According to data published by Bank of America Securities, non-QM originations are expected to rise to $175 billion this year, up from $108 billion in 2025.Non-QM borrowers are found in major cities as well as smaller and rural markets, where conventional loans may not fit how they earn income or invest in real estate. The result is a pool of borrowers who are less defined by poor credit than by financial complexity.“The majority of non-QM is bank-statement and investor,” said Tom Davis, chief sales officer at Deephaven Mortgage. “You’re going to have high income, high net worth, well-heeled borrowers, larger down payments.” First-party production data for 2026 from Griffin Funding illustrates the point. Through mid-September, the lender’s...