Loading
Palos Verdes Estates attracts retirees, entrepreneurs, and high-net-worth buyers who hold significant assets but lack W-2 income. Asset depletion loans convert your liquid holdings into qualifying income.
This loan type fits the city's demographic perfectly. When your portfolio exceeds your paycheck, traditional underwriting fails you.
Lenders divide your total liquid assets by 360 months to calculate monthly income. A $3.6M portfolio becomes $10K monthly qualifying income.
You need minimum 620 credit, though 680+ gets better terms. Most lenders require at least $500K in liquid assets after down payment and reserves.
Acceptable assets include brokerage accounts, mutual funds, stocks, bonds, and retirement accounts. Real estate equity and business holdings don't count.
Expect 20-30% down payments. Lenders hold 12-24 months of reserves after closing. Higher reserves compensate for income volatility risk.
Asset depletion lives exclusively in the non-QM space. No government agencies or conventional programs offer this structure.
Each lender applies different depletion formulas. Some divide by 360 months, others use 240 or 120. The denominator drastically changes your qualifying income.
SRK CAPITAL shops your profile across 30+ non-QM lenders. We know which lenders count retirement accounts at full value versus discounted calculations.
Asset depletion works best when you're 5+ years from retirement distributions. If you're already taking income, bank statement loans often give better terms.
We see Palos Verdes buyers use this for second homes or downsizing purchases. They sold businesses, retired early, or live off investments.
Disclosure requirements vary. Some lenders need full brokerage statements, others accept summary letters. Preparation speed matters in competitive offers.
Rates run 1-2% above conventional pricing. You pay for underwriting flexibility. Most borrowers refinance once income structure changes.
Bank statement loans beat asset depletion when you show consistent deposits. Lenders average 12-24 months of statements to calculate income.
Foreign national loans require larger down payments but accept international assets. DSCR loans ignore income entirely for investment properties.
1099 contractors often qualify conventionally with two years returns. Asset depletion makes sense when tax deductions tank your AGI.
Palos Verdes Estates properties command premium prices. Asset depletion loan limits typically cap at $3-4M depending on lender.
The city's strict building codes and neighborhood associations create unique appraisal considerations. Non-QM underwriters scrutinize resale potential closely.
Ocean-view properties carry higher insurance costs. Lenders factor these into debt-to-income ratios even when using asset depletion formulas.
Competition runs hot in this market. Pre-approval strength matters. Sellers favor buyers with verified liquid assets over uncertain income.
Stocks, bonds, mutual funds, savings, money markets, and retirement accounts work. Real estate equity and business ownership don't qualify.
Using 360-month depletion, $2M creates $5,555 monthly income. Actual loan amount depends on debts, credit, and down payment size.
No liquidation required for qualification. Assets stay invested. You only need sufficient reserves after closing.
Yes, most lenders count retirement accounts. Some discount the value 30% to account for taxes and penalties.
Expect 3-4 weeks from application to clear-to-close. Brokerage statement verification and asset sourcing add time versus conventional loans.
Asset Depletion Loans in Palos Verdes Estates