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Asset Depletion Loans in Hanford
Hanford's agricultural economy creates unique borrower profiles. Landowners and business operators often hold significant assets but show limited W-2 income.
Asset depletion loans treat your liquid assets as monthly income. A $600,000 portfolio becomes qualifying income without selling a single holding.
This works well in Kings County where multi-generational wealth sits in land trusts and investment accounts. Traditional lending ignores that capital entirely.
Lenders divide your total liquid assets by 360 months (30 years). That monthly figure becomes your qualifying income for debt-to-income calculations.
You need substantial reserves. Most programs require $500,000 minimum in verifiable liquid assets after down payment and closing costs.
Credit scores start at 660, though stronger profiles get better terms. Down payments run 15-25% depending on asset depth and property type.
Acceptable assets include checking, savings, stocks, bonds, mutual funds, and retirement accounts. Real estate equity and business valuations don't count.
Only non-QM lenders offer asset depletion programs. No government agency or conventional lender will qualify you this way.
We work with 15-20 wholesale lenders who price these loans competitively. Rates run 1-2% above conventional mortgages, reflecting the non-traditional underwriting.
Some lenders allow 70% asset depletion calculations (dividing by 84 months instead of 360). That creates higher qualifying income but requires deeper reserves.
Portfolio lenders keep these loans in-house rather than selling them. That gives them flexibility on property types and unique situations.
This loan makes sense for retirees with pension income that doesn't show on tax returns. Also business owners who reinvest profits and show minimal taxable income.
We see Hanford buyers use this after selling farmland or receiving inheritance. The cash sits in accounts, but traditional lenders can't use it for qualification.
Cost matters here. Expect 1-2 points in origination fees plus higher rates. Run the numbers against depleting assets to buy cash—sometimes cash wins.
Document everything. Lenders need 2-3 months of account statements showing consistent balances. Sudden large deposits without explanation kill deals.
Bank statement loans work better if you have consistent business deposits. They're usually cheaper and need less cash on hand.
DSCR loans make more sense for investment properties. Why deplete personal assets when rental income can qualify the deal?
Foreign national programs overlap with asset depletion but add cross-border complications. If you're a U.S. citizen with assets, this route is cleaner.
1099 loans require income documentation asset depletion avoids. If your tax returns don't reflect true earning power, asset depletion sidesteps that issue entirely.
Hanford's median home prices make asset depletion viable for more buyers than in coastal markets. You need less total assets to qualify here.
Kings County appraisals can be tricky on rural properties. Asset depletion lenders sometimes balk at agricultural parcels without comparable sales data.
Local credit unions won't touch these loans. You need a broker with non-QM lender relationships—this isn't a product you'll find at a bank branch.
Settlement timing matters. Asset depletion underwriting takes 30-45 days minimum. Sellers expecting quick closes may not wait.
Most lenders require $500,000 minimum in liquid assets after your down payment. Higher balances unlock better rates and terms.
Yes. IRAs, 401(k)s, and other qualified accounts count, though lenders apply a 70% discount to reflect early withdrawal penalties.
Rates vary by borrower profile and market conditions, but typically run 1-2% higher than conventional mortgages. Strong credit and larger down payments help.
Yes, though DSCR loans often make more sense for rentals. Asset depletion works best for primary residences or second homes.
Expect 30-45 days from application to clear-to-close. Asset verification and non-QM underwriting take longer than conventional loans.
Absolutely. Many borrowers use asset depletion for rate-term or cash-out refinances when traditional income doesn't support the loan amount.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.