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Asset Depletion Loans in Palos Verdes Estates
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.
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.