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Lomita sits between Harbor Gateway and Rolling Hills Estates, attracting retirees and high-net-worth buyers who don't fit traditional income boxes. Asset depletion loans let you qualify using liquid assets instead of W-2s or tax returns.
This program converts your investment accounts into qualifying income by dividing the total balance by 360 months. A $2 million portfolio becomes $5,555 monthly income for qualification purposes.
Most Lomita buyers using asset depletion are early retirees, business owners with complex tax returns, or investors managing multiple properties. They have cash but show low taxable income.
Asset Depletion Loans in Lomita
You need $500,000 minimum in liquid assets to make the math work for most Lomita properties. Credit score floors vary by lender but expect 660-680 minimums with 20-30% down.
Eligible assets include stocks, bonds, retirement accounts, and CDs. Real estate equity doesn't count. Your lender calculates monthly income by taking 70% of the asset value and dividing by 360.
The 70% haircut accounts for market volatility and potential penalties on retirement withdrawals. If you have $1 million in assets, your qualifying income is roughly $1,944 per month.
Asset depletion is a non-QM product with fewer lenders than conventional programs. We work with 15-20 wholesale lenders offering competitive variations of this program.
Some lenders allow gift funds for down payment, others don't. Some accept foreign assets, most won't. Rate spreads between lenders can hit 75 basis points on identical borrower profiles.
Most asset depletion lenders price these as investor loans regardless of occupancy. Expect rates 1-2% above conventional conforming loans with similar credit and LTV.
This loan makes sense when you have significant assets but minimal taxable income. It doesn't work if you're trying to maximize buying power with limited savings.
The biggest mistake is not shopping lenders. One lender might count 100% of retirement accounts while another applies the 70% haircut. That difference changes your qualification amount dramatically.
We also see borrowers miss opportunities to combine asset depletion with other income sources. Some lenders let you add Social Security or pension income on top of asset calculations.
Bank statement loans often beat asset depletion for self-employed borrowers with business income. You'll qualify for more house using 12-24 months of deposits versus portfolio division.
DSCR loans work better for Lomita investment properties since they ignore personal income entirely. Asset depletion makes sense for primary residences or when rental income won't cover the note.
Foreign national loans handle non-resident buyers who may have offshore assets. Asset depletion requires US-based accounts and typically demands citizenship or permanent residency.
Lomita home prices vary from older single-family homes to newer construction near Lomita Boulevard. The asset depletion calculation matters more in higher price ranges where conventional conforming loans hit limits.
South Bay attracts aerospace retirees and business owners who've sold companies. Many have $2-5 million in investments but show $50,000 in taxable income on returns.
Proximity to ports and aerospace employers creates steady demand from buyers transitioning from high-income careers to retirement. Asset depletion bridges that income documentation gap perfectly.
Lenders use the value at application or a recent statement. Market fluctuations during your 30-45 day close rarely cause issues unless you liquidate accounts.
Yes, most lenders count retirement accounts at 70% of value. Some allow 100% if you're past penalty-free withdrawal age but policies vary by lender.
Stated income loans no longer exist post-2008. Asset depletion provides actual documentation through account statements rather than unsupported income claims.
No, assets stay invested. Lenders verify balances through statements but don't require you to sell or move funds except for down payment and closing costs.
Most lenders require 20-30% down. Higher LTV options exist but add rate premiums and may require larger asset reserves beyond the qualification amount.