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Asset Depletion Loans in South Gate
South Gate buyers with substantial savings but irregular income face a qualification gap. Traditional lenders ignore your six-figure portfolio if you can't show W-2s.
Asset depletion programs solve this by converting your liquid assets into qualifying income. Your $600K in stocks becomes $2,500/month in calculated income for approval.
This matters in South Gate where many self-employed residents and immigrant families have built wealth outside traditional employment. Your balance sheet counts more than your pay stub.
You need at least $100K in liquid assets to start the conversation. Most lenders want to see $200K+ for properties in South Gate's price range.
Your assets get divided by 240 months to create qualifying income. That's a 20-year depletion schedule, though you never actually withdraw the money.
Credit scores need to hit 680 minimum. Many lenders require 700+ for asset depletion programs since there's no income documentation backstop.
Asset depletion sits in the non-QM space, which means fewer lenders and higher rates than conventional loans. You're looking at 200-300 basis points above conforming rates.
Down payment requirements run 20-30% depending on credit score and total asset position. Stronger portfolios unlock better pricing and lower down payment options.
Not all non-QM lenders offer asset depletion. We access about 25 wholesale partners who write these programs, each with different asset calculation methods.
Here's what trips up most borrowers: not all assets count. Checking accounts and savings work. So do stocks, bonds, and mutual funds minus a 30% haircut for volatility.
Retirement accounts get discounted harder because of early withdrawal penalties. Figure 60-70% of IRA value counts toward your qualifying assets.
Timing matters. Market dips hurt your qualifying power since calculations use recent statements. Wait for your portfolio to recover before applying if you're borderline.
Bank statement loans beat asset depletion if you have business income to show. Those programs typically get better rates and need less down.
But asset depletion wins when your income is genuinely zero or when business deposits don't paint a clean picture. Retirees under 59.5 who can't tap IRAs without penalty use this constantly.
Foreign nationals with US assets also lean on this program since they can't produce domestic tax returns. Your asset base becomes the entire underwriting story.
South Gate properties cluster in the $500K-$700K range, which means you need roughly $150K-$200K in assets to qualify using depletion alone at 20% down.
Many South Gate buyers combine asset depletion with co-borrower income. One spouse uses W-2 income while the other qualifies through assets to boost buying power.
Appraisals come in tight here. Lenders want properties in good condition since they're taking income documentation risk. Plan for inspection repairs before appraisal if buying older South Gate housing stock.
No. The 240-month calculation is just for qualifying income. Your assets stay invested exactly as they are now.
Most lenders require US-based accounts for asset depletion. Some accept international accounts with extra documentation and exchange rate adjustments.
Lenders re-verify assets before funding. A 10-15% drop usually won't kill the deal, but major losses can derail approval.
Figure 30-45 days from application to clear-to-close. Asset verification adds time versus traditional income documentation.
Yes. Asset depletion works for purchases and rate-term refinances as long as you meet minimum asset thresholds.
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.