Question 1

Can I use my 401(k) for asset depletion without withdrawing funds?

Accepted Answer

Yes. Lenders calculate income based on the balance but discount it 30-40% for potential penalties. You don't actually withdraw anything during the loan process.

Question 2

Do I need to show where my assets came from?

Accepted Answer

Yes. Lenders require 2-3 months statements and want to see funds seasoned at least 60 days. Large recent deposits trigger sourcing requirements like any mortgage.

Question 3

What happens if my portfolio drops in value during underwriting?

Accepted Answer

Lenders use the value at initial submission. Small fluctuations don't matter, but a 20%+ drop could require updated statements and recalculation of qualifying income.

Question 4

Can I combine asset depletion with other income sources?

Accepted Answer

Yes. Some lenders let you blend asset depletion with Social Security, pension income, or rental income to strengthen your debt-to-income ratio and improve pricing.

Question 5

How does asset depletion work for second homes in West Sacramento?

Accepted Answer

Second homes require higher reserves and some lenders cap asset depletion at primary residences only. Expect stricter underwriting and potentially 15-20% down minimum.

Asset Depletion Loans in West Sacramento: Qualify Using Your Portfolio, Not Your Paycheck