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Manhattan Beach buyers with substantial liquid assets often struggle with traditional income documentation. Asset depletion loans let you qualify using investment accounts, retirement funds, and cash reserves instead of W-2s.
This loan type fits retirees, trust fund beneficiaries, and equity-rich entrepreneurs common in this coastal market. Lenders calculate a monthly income stream by dividing your assets by 360 months, then use that figure for approval.
Most lenders require $500,000 minimum in verifiable liquid assets after your down payment. Credit scores start at 680, though some programs accept 660 with higher reserves.
You'll need bank and brokerage statements covering the last two months. Lenders apply a depletion rate—typically 30 to 60 months depending on the program—to calculate qualifying income from your portfolio balance.
Not every non-QM lender offers asset depletion programs. Of the 200+ lenders we work with, fewer than 40 carry this product, and their underwriting varies significantly.
Some count retirement accounts at full value. Others discount 401(k)s by 30% for early withdrawal penalties. Finding the lender that treats your specific asset mix favorably changes your buying power by six figures.
Manhattan Beach deals often involve stock portfolios from tech exits or executive compensation packages. The biggest mistake is moving money between accounts during the loan process—lenders see that as red flags requiring sourcing letters.
We see borrowers qualify for 30% more loan when we match them to lenders who don't penalize their asset type. A client with $2M in municipal bonds needs a different lender than someone holding $2M in a Schwab brokerage account.
Bank statement loans work better if you run a profitable business with consistent deposits. Asset depletion makes sense when your wealth sits in investments, not operating accounts.
Foreign national loans require similar documentation but allow non-U.S. citizens. If you're a domestic buyer with assets but irregular income, asset depletion typically offers lower rates than other non-QM options.
Manhattan Beach's $2M+ median price range makes asset depletion practical here. A $1.5M loan requires roughly $2.5M in post-closing liquid assets at typical depletion rates.
Beachfront properties often need jumbo loan amounts. Some asset depletion lenders cap at $2M, while others go to $4M. Match your target property price to the right lender before you start shopping homes.
Most lenders accept checking, savings, brokerage accounts, stocks, bonds, and mutual funds. Retirement accounts like 401(k)s and IRAs usually count but may face discount rates of 20-30%.
They divide your total verified liquid assets by a depletion period, typically 30 to 60 months. A $1.8M portfolio divided by 60 months creates $30,000 monthly qualifying income.
Yes, if your spouse is a co-borrower on the loan. Assets must be jointly titled or the account holder must be on the mortgage application.
Rates typically run 1-2% above conventional loans. A conventional loan at 6.5% might price at 7.5-8% for asset depletion, varying by credit score and loan amount.
No. Lenders verify your assets exist but don't require you to sell them. The depletion calculation is a formula for qualifying income, not a withdrawal requirement.
Asset Depletion Loans in Manhattan Beach