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Asset Depletion Loans in Madera
Madera's housing market attracts retirees, business owners, and investors who hold significant assets but lack traditional W-2 income. Asset depletion loans let you qualify using liquid accounts—stocks, bonds, retirement funds—instead of employment verification.
This loan type works well in Madera County where agricultural business owners and recent retirees have substantial savings but irregular income streams. Lenders calculate monthly income by dividing your liquid assets by 360 months (30 years) to determine what you can afford.
You need $200,000+ in liquid assets to make these loans work for most Madera properties. Credit scores start at 620, though 680+ gets better pricing. Lenders divide your total liquid assets by 360 to calculate monthly qualifying income.
Down payments range from 20-30% depending on credit and asset levels. The more liquid assets you have relative to the loan amount, the stronger your application. Madera County's lower price points compared to coastal cities make asset depletion easier to qualify for here.
Asset depletion loans come from non-QM lenders only—traditional banks don't offer this program. We work with 20+ lenders who price these loans differently based on asset levels, credit, and property type. Shopping across multiple lenders matters here more than conventional loans.
Rates run 1.5-3% higher than conforming loans because this is specialty financing. Expect more documentation upfront: 60-90 days of statements for all accounts used for qualification. Some lenders exclude retirement accounts; others allow 401(k)s and IRAs with discounts applied.
Most Madera borrowers using asset depletion are either business owners with profits tied up in equipment or retirees downsizing from larger markets. The math works best when your assets are at least 3x the loan amount—that generates enough calculated income to qualify comfortably.
Watch out for lenders who count only 70% of retirement account values. That 30% haircut can kill your qualifying income if most assets sit in IRAs. We steer clients toward lenders who accept higher percentages or blend multiple account types for better calculations.
Bank statement loans work better if you have consistent deposits but irregular tax returns. Asset depletion fits borrowers with large savings but minimal current income. DSCR loans beat both if you're buying investment property—rental income qualifies you without touching personal assets.
Foreign national loans require similar down payments but don't need U.S. credit history. If you're comparing options, asset depletion gives you the most flexibility when you have substantial liquidity but complex income documentation.
Madera County's median home prices make asset depletion more accessible than coastal markets. A $400,000 purchase needs roughly $700,000 in qualifying assets with 25% down—achievable for many retirees moving from Bay Area or Southern California.
Agricultural land purchases rarely qualify for asset depletion unless improved with a residence. Stick to single-family homes, condos, or small multifamily properties. Madera's growing retirement community creates steady demand for this loan type among downsizers with equity but no job.
Checking, savings, money market accounts, stocks, bonds, mutual funds, and sometimes retirement accounts. Real estate equity and business assets don't count.
Yes, most lenders count 70-100% of vested retirement balances as assets. You don't withdraw anything—lenders just use the balance for income calculation.
Expect 30-45 days from application to closing. Document collection takes longer than conventional loans because lenders verify multiple account statements and balances.
No, that's the main advantage. Lenders verify assets only, not income documentation or employment history.
Most lenders cap these loans at $3-4 million. Higher amounts become difficult to qualify for even with substantial assets.
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.