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Martinez attracts retirees and high-net-worth buyers who own their wealth outright. Many have seven-figure portfolios but minimal W-2 income. Traditional lenders reject these borrowers despite obvious ability to pay.
Asset depletion loans convert your liquid assets into qualifying income. Lenders divide your portfolio by 360 months to calculate monthly income. A $2 million account becomes $5,555 monthly income for qualification purposes.
You need substantial liquid assets in retirement accounts, brokerage accounts, or savings. Most lenders want $500K minimum after down payment and reserves. Credit scores start at 660, though 700+ gets better pricing.
The asset calculation is straightforward: total eligible assets minus down payment and reserves, divided by 360. Only liquid assets count. Real estate equity and business holdings don't qualify under this formula.
Only non-QM lenders offer true asset depletion programs. Your local credit union won't have this product. We access 30+ non-QM lenders who price these loans differently based on leverage and asset type.
Rates run 1-2% above conventional mortgages. The spread tightens with lower loan-to-value ratios. Borrowers putting 30%+ down see competitive pricing. Expect $2,500-$4,000 in lender fees beyond standard closing costs.
I see asset depletion most with tech employees who retired at 45 and Martinez retirees downsizing from bigger Bay Area homes. They have the money but stopped working. Banks deny them because underwriting software can't read a brokerage statement.
Timing matters here. Apply when your portfolio is up, not after a market correction. Lenders use a 30-day average, but some will haircut volatile holdings. Keep six months reserves beyond what you're depleting for qualification.
Bank statement loans work better if you're still self-employed with business income. Asset depletion makes sense when you've actually stopped working. Foreign national loans require this approach if you're a non-resident investor.
DSCR loans beat asset depletion for investment properties since rental income qualifies you. But for primary residences in Martinez, asset depletion is often the only path when income documentation is impossible.
Martinez home prices stay below $1M for most single-family properties. That loan size works well with asset depletion since lenders cap these loans at $2-3M depending on the program. Jumbo asset depletion gets expensive fast.
The city's retired demographic makes this loan type more common here than in surrounding Contra Costa cities. Lenders familiar with Martinez understand the buyer profile. Properties near downtown and the waterfront appraise cleanly.
Checking, savings, money market, stocks, bonds, mutual funds, and retirement accounts all qualify. Real estate equity, business ownership, and crypto typically don't count.
Yes, if you're married you can use joint assets even if only one spouse is on the mortgage. You'll need statements showing both names on the accounts.
Minimum is usually 20%, but 25-30% down significantly improves your rate. The less you borrow relative to assets, the better your pricing.
No, you keep your investments. Lenders just use the portfolio value to calculate qualifying income. You make regular mortgage payments from whatever source you choose.
Lenders use statements from the application date. Market changes after you lock don't affect your approval as long as you maintain required reserves.
Asset Depletion Loans in Martinez