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Asset Depletion Loans in Nevada City
Nevada City attracts retirees and investors with significant assets but limited W-2 income. Asset depletion loans convert your liquid holdings into qualifying income.
Properties here range from historic downtown homes to foothill estates. Buyers often come from Bay Area tech backgrounds with substantial portfolios but irregular paychecks.
This loan type fits Nevada City's demographic reality. Many qualified buyers don't fit traditional employment boxes but have seven-figure brokerage accounts.
Lenders divide your total liquid assets by 360 months to calculate monthly income. A $1.8M portfolio creates $5,000 monthly qualifying income.
You need 20-30% down and 680+ credit scores. Assets must be liquid: stocks, bonds, retirement accounts, and cash equivalents count.
Real estate equity and business valuations don't qualify. Lenders want assets you can convert to cash within 90 days without massive tax penalties.
Expect rates 0.5-1.5% above conventional programs. You're paying for underwriting flexibility, not buying risk.
Asset depletion lives in the non-QM space. Maybe 30 of our 200+ wholesale lenders offer these programs, and their calculation methods vary significantly.
Some lenders use 84-month depletion schedules instead of 360, creating higher qualifying income. Others accept IRAs at full value while competitors discount them 30%.
Rate spreads between lenders hit 0.75% on identical scenarios. Shopping this loan type saves real money because pricing isn't standardized like conforming loans.
Most asset depletion lenders want full appraisals and title work before final approval. Budget 45-60 days for closing, not the 21-day timeline you see advertised online.
Asset depletion works best when you have $2M+ in liquid holdings. Below that threshold, bank statement or DSCR loans usually deliver better rates.
We see Nevada City buyers struggle when their assets sit in restricted stock or land holdings. Lenders want brokerage statements showing accessible funds.
The 360-month formula hurts buyers with $500K-$1M portfolios. You're creating $1,400-$2,800 monthly income, which barely qualifies for local median prices.
Smart play: combine asset depletion with rental income from investment properties. Some lenders let you stack income sources for higher qualification amounts.
Bank statement loans beat asset depletion for business owners with consistent deposits. You'll get better rates using 12-24 months of bank activity.
DSCR loans work better for pure investors buying rentals. No personal income documentation needed when the property cash flows above 1.0 ratio.
1099 contractors should explore stated income options before asset depletion. Why burn through portfolio calculations when your tax returns show income?
Asset depletion shines for one scenario: early retirees with large portfolios and zero documentable income streams. That's its sweet spot.
Nevada City's small inventory means you're often competing against conventional buyers. Asset depletion takes longer to close, which weakens your offer strength.
Properties here need thorough inspections. Older construction and septic systems create appraisal challenges that extend timelines beyond standard non-QM deals.
Nevada County has specific fire insurance requirements post-Camp Fire. Your asset depletion approval means nothing if you can't secure hazard coverage in 30 days.
Local title companies understand these loan structures, but not every listing agent does. Expect to educate sellers about non-QM credibility and closing certainty.
Stocks, bonds, mutual funds, money market accounts, and accessible retirement accounts qualify. Real estate equity and restricted stock don't count as liquid assets.
For a $600K purchase, expect to need $1.5M+ in liquid assets after your down payment. That creates enough monthly qualifying income for most lenders.
Yes, but you'll need 25-30% down instead of 20%. Second home rates run 0.25-0.5% higher than primary residence pricing.
They work if the property appraises and meets lender condition standards. Older homes may need repairs before final loan approval.
Most lenders require 680 minimum. Some accept 660 with larger down payments and stronger asset positions.
Expect 0.5-1.5% higher than conventional rates. A conventional loan at 7% means asset depletion pricing around 7.5-8.5%, varying by lender and scenario.
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.