Portfolio Loan vs Non-QM Rate Comparison Calculator

Portfolio loans are mortgages held by the originating lender on its balance sheet — never sold to Fannie Mae, Freddie Mac, or investor pools. Non-QM (non-qualified mortgage) loans are securitized into bond pools and sold to private investors. Both serve borrowers who don't fit conventional Fannie/Freddie criteria. Compare pricing, fees, and flexibility to choose the right product.

Portfolio Loans: Bank Relationship Pricing

Portfolio loans are funded by the originating bank's deposits and held on its balance sheet for the life of the loan. The bank assumes all credit risk, sets its own underwriting standards, and can be more flexible than securitized loan programs. Pricing is typically the bank's cost of funds plus a margin (often 1.5-2.5% above 10-year Treasury). Best for: borrowers with deep banking relationships, complex income, unique properties (multi-unit, mixed-use, rural), or high-net-worth clients of private banks. Approval often hinges on the overall relationship value to the bank, not just the loan metrics.

Non-QM Loans: Wider Availability, Defined Programs

Non-QM loans are originated by a specialist lender, packaged into bond pools, and sold to investors. Pricing reflects investor yield demands and servicing fees — typically 1-3% above conventional. Programs are well-defined: bank statement loans for self-employed, DSCR loans for investors, foreign national loans, ITIN loans, asset depletion loans. Non-QM is available from hundreds of lenders nationwide, making it easier to shop than portfolio loans. Choose non-QM when you need a specific program, when portfolio lenders decline you, or when you want competitive shopping across multiple lenders.

Last updated May 2026. Sources: FDIC Bank Lending.