Filling the Gap
The research identifies NQM Funding as a specialized “Non-QM Innovator.” While traditional banks have rigid boxes that borrowers must fit into, NQM Funding focuses on the gap left behind. Their program is designed for the modern real estate entrepreneur who needs logic-based decisions, not just a checklist.
The data highlights their sophisticated approach to Short-Term Rentals. They explicitly mention the use of “AirDNA or PriceLabs” for income projections. By prioritizing the “revenue-generating potential” of the property over the borrower’s personal debt-to-income ratio, they align perfectly with the goals of rental investors.
The Power of 85% LTV
The standout feature in the analysis is NQM Funding’s leverage. Most competitors in the Texas market cap their loans at 80% Loan-to-Value (LTV).
NQM Funding offers up to 85% LTV for purchases.
- The Math: On a $400,000 purchase, a standard lender requires an $80,000 down payment (20%). NQM Funding requires only $60,000 (15%).
- The Benefit: This keeps $20,000 in the investor’s pocket. This capital efficiency can significantly boost the “Cash-on-Cash Return,” or it can be saved to buy furniture and amenities for the new rental.
Trading Liquidity for Leverage
The research shows that NQM Funding offers flexibility for different types of deals.
- Preferred Ratio: They prefer a DSCR of 1.00 or higher (where rent covers the mortgage).
- The Exception: They allow for a DSCR as low as 0.75 if the borrower has “additional reserves.”
This is a sophisticated trade-off. It allows cash-rich investors to buy properties that might not have high cash flow yet—such as a home in a rapidly appreciating neighborhood—by showing they have enough savings to cover the difference.
Accessibility
NQM Funding strikes a balance between strict banks and expensive hard money lenders.
- Credit Score: Their minimum FICO score is 640. This provides an entry point that is more accessible than the strict 680 or 700 scores required by some institutional lenders.
- Texas Focus: They identify specific Texas drivers—like Austin’s tech scene and Dallas’s corporate hubs—as key factors in their lending decisions. This indicates they are actively targeting the state due to its strong economic fundamentals.
Summary of Strategic Fit
NQM Funding is the clear partner for the Leverage Maximizer. If your goal is to stretch your equity as far as possible, the 85% LTV option is a powerful tool. Combined with their acceptance of AirDNA data, they offer one of the most capital-efficient products in the market.
Next Step: If you want to keep more cash in your pocket for your next acquisition, you can explore their high-leverage options here. Visit NQM Funding
Finding the right financial partner is about matching their strengths to your specific plan. If this lender’s program does not fit your current strategy—whether you need more speed, higher leverage, or different terms—you have other options. We have analyzed the entire market for you. Review our full guide to the Top 10 Texas DSCR Lenders to compare every option side-by-side.