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Asset Depletion Loans in Santa Cruz
Santa Cruz attracts retirees and investors who live off assets, not W-2s. Traditional income verification locks them out.
Asset depletion loans let you qualify using investment accounts, retirement funds, or cash reserves. Lenders divide your liquid assets by 360 months to calculate qualifying income.
This works for early retirees moving to coastal Santa Cruz or tech employees with stock compensation that doesn't show on tax returns.
You need $500,000+ in liquid assets to make the math work on most Santa Cruz properties. Credit scores start at 620, though 680+ gets better pricing.
Acceptable assets include brokerage accounts, retirement funds, stocks, bonds, and mutual funds. Real estate equity doesn't count.
Down payments range from 20-30% depending on property type and total asset position. Higher reserves strengthen your application.
Only non-QM lenders offer asset depletion programs. They're not available through Fannie Mae or FHA.
Each lender calculates depletion differently. Some use 84 months instead of 360, which creates higher qualifying income from the same assets.
Rates run 1-2% above conventional loans. Pricing improves with larger down payments and stronger credit profiles.
The 84-month calculation is massive. It nearly quadruples your qualifying income compared to the 360-month formula.
We layer asset depletion with other documentation when possible. Some lenders let you combine partial W-2 income with asset calculations to maximize buying power.
Santa Cruz buyers often have assets tied up in stock options or restricted shares. Those don't count until vested and liquid.
Get valuations dated within 90 days of application. Outdated statements kill deals at the finish line.
Bank statement loans work better if you have business income but low taxable earnings. Asset depletion fits when you have no consistent income stream.
DSCR loans make sense for investment properties. Asset depletion handles primary residences and second homes in Santa Cruz.
If you're drawing from retirement accounts anyway, asset depletion beats trying to document inconsistent distributions as income.
Santa Cruz second homes often go to Bay Area buyers with significant investment portfolios. Asset depletion fits that profile perfectly.
The coastal market sees seasonal price movement. Locking rates early protects you if your asset values fluctuate during a 45-60 day close.
Many Santa Cruz properties need work. Some asset depletion lenders won't touch fixer-uppers, so renovation plans affect lender selection.
Brokerage accounts, retirement funds, stocks, bonds, mutual funds, and savings accounts qualify. Real estate equity and unvested stock options don't count.
Yes. Lenders calculate qualifying income from the account balance without requiring distributions. You don't need to liquidate retirement funds.
With 25% down, you'd need roughly $1.2-1.5 million in liquid assets using a 360-month depletion schedule. Less with an 84-month formula.
Yes, if the condo is warrantable and meets standard lending requirements. Non-warrantable condos limit your lender options significantly.
Expect 45-60 days total. Asset verification adds time, especially for accounts at multiple institutions or foreign banks.
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.