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Asset Depletion Loans in San Carlos
San Carlos attracts retirees, entrepreneurs, and high-net-worth individuals who have substantial assets but non-traditional income streams. Asset depletion loans serve this demographic by using liquid investments to demonstrate loan repayment ability.
San Mateo County's affluent Peninsula communities include many households with significant portfolios from stock options, business sales, or inheritance. Traditional income verification often undervalues their financial strength.
This loan structure calculates a theoretical monthly income by dividing your liquid assets by the loan term in months. Lenders typically use 60-360 months depending on the program, creating qualifying income without W-2s or tax returns.
Borrowers need substantial liquid assets—typically $500,000 minimum in readily accessible accounts. Qualifying assets include checking, savings, stocks, bonds, mutual funds, and certain retirement accounts like IRAs and 401(k)s.
Credit scores generally start at 680, though some lenders require 700 or higher. Down payments range from 20-30% depending on property type and total asset value. Rates vary by borrower profile and market conditions.
Lenders divide your total qualifying assets by a depletion period to calculate monthly income. A borrower with $1.2 million in liquid assets using a 120-month term would show $10,000 monthly qualifying income.
Asset depletion loans come exclusively from portfolio lenders and non-QM specialists, not government programs or conventional channels. Each lender sets their own asset calculation methods and depletion timelines.
Some lenders count 100% of liquid assets while others discount retirement accounts by 30-40% due to withdrawal penalties. Understanding these calculation differences significantly impacts your borrowing power.
Documentation requirements remain thorough despite no income verification. Expect to provide recent bank statements, brokerage statements, and retirement account balances with detailed sourcing.
Many San Carlos borrowers qualify for higher loan amounts by choosing lenders with longer depletion periods. A 360-month term versus 120 months triples your qualifying income from the same asset base.
Timing matters when documenting assets. Stock market volatility can affect your account balances, so we often recommend capturing statements when markets are strong. Consistent balances across multiple months strengthen applications.
Borrowers sometimes combine asset depletion with other income sources. Adding rental income, pensions, or Social Security alongside asset calculations can reduce the required down payment or improve rate pricing.
Bank statement loans work better for self-employed borrowers with strong business cash flow but limited liquid assets. Asset depletion suits investors and retirees with the opposite profile—significant savings but minimal current income.
Foreign national loans require similar down payments but involve additional documentation like passport verification and international credit reports. Asset depletion programs focus purely on U.S.-based liquid holdings.
DSCR loans eliminate personal income verification for investment properties by using rental cash flow. Asset depletion applies to primary residences and second homes where rental income doesn't exist.
San Carlos sits in one of California's highest-cost housing markets on the Peninsula. Asset depletion loans help longtime residents downsize or relocate while accessing their accumulated wealth without returning to traditional employment.
The city's proximity to Silicon Valley means many potential borrowers hold concentrated stock positions from tech companies. Lenders evaluate concentration risk differently, with some requiring diversification across multiple asset classes.
San Mateo County property values create higher loan amounts than national averages. Borrowers should verify their lender's maximum loan limits for asset depletion programs, as some cap at $2-3 million regardless of asset levels.
Liquid assets include checking, savings, money market accounts, stocks, bonds, mutual funds, and retirement accounts like IRAs and 401(k)s. Some lenders discount retirement funds by 30-40% due to early withdrawal penalties.
Most programs require $500,000 minimum in qualifying assets, though higher-priced San Carlos properties often need $1 million or more. Your exact requirement depends on purchase price, down payment, and the lender's depletion calculation.
Yes, but lenders verify sufficient reserves remain after closing. You need enough assets to cover your down payment, closing costs, and still maintain the balance used for income calculation plus required reserves.
Asset depletion loans typically carry higher rates than conventional programs due to their non-QM structure. Rates vary by borrower profile and market conditions but expect 1-3% above conventional pricing.
Processing typically takes 30-45 days, similar to conventional loans. The timeline depends on how quickly you provide complete asset documentation and whether any accounts need additional verification or sourcing.
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.