With all the options available for mortgages, it can undoubtedly be overwhelming; this is why we at ID Mortgage Broker work so hard to make it easier and more personalized to your financial situation.
One innovative option is the asset depletion mortgage. This loan works particularly well for those with substantial assets with irregular or non-traditional income sources.
Examples of such individuals include retirees, entrepreneurs, and those seeking investment property loans in California.
What is an Asset Depletion Mortgage?
Asset depletion mortgage is a mortgage for which applicants may be qualified based on their assets rather than traditional income sources.
In an asset depletion mortgage, a borrower’s repayment ability is determined based on depleting liquid assets over the loan term. It offers an excellent alternative for those needing a steady monthly income but possessing significant financial assets.
Key Features of Asset Depletion Mortgages
- Asset-based qualification. Qualification is based on the value of your liquid assets, such as savings accounts, stocks, and bonds, instead of using income for the qualification process. A lender will calculate a hypothetical monthly income by dividing the total assets by the selected time, which can be over the life of the loan.
- Ideal for unconventional income sources. These loans are especially suitable for retirees whose savings or investment account levels might be high but whose regular employment incomes are zero. This approach also benefits self-employed entrepreneurs and investors who often have fluctuating incomes or may benefit from no-document loan options in California.
- Competitive rates and terms. The rates and terms can be competitive and customized depending on the borrower’s financial situation and asset profile. The loan limit is much higher and ideal for buying luxury properties or refinancing jumbo loans in California.
Benefits of Asset Depletion Mortgages
- Leverage your wealth. Your existing assets may help you qualify for a mortgage with a lower income and unlock your wealth more efficiently.
- Liquidity preservation. You will not immediately have to liquidate your assets to qualify; therefore, you can protect your investment strategy and cash position where they best serve you.
- Financial planning flexibility. Choose loan terms that match your long-term financial goals and ensure the mortgage fits your big-picture financial strategy.
Potential Downsides of Asset Depletion Mortgages
- Greater asset requirement. You must have substantial liquid assets to qualify, which may not be ideal for all borrowers.
- Qualifying is complicated. Qualifying can become complex, as you must outline all assets and their associated values.
- Possible asset depletion. Financial planning is required to use up the assets during the loan period, thus necessitating a focus so that you may not run out of your reserve earlier than expected.
How ID Mortgage Broker Can Help
ID Mortgage Broker specializes in guiding clients through the mortgage process and finding solutions that best suit their financial situation and goals.
Our team of experts offers personalized advice and support through the process so that you may fully understand every part of the asset depletion mortgage and the benefits it can bring to you.
Steps to Obtain an Asset Depletion Mortgage
1. Initial consultation
Meet with one of our mortgage professionals to discuss your financial situation and confirm whether an asset-depletion mortgage is right for you.
2. Asset calculation
Document your liquid assets through bank statements, investment accounts, and other financial documentation.
3. Loan application
Complete the loan application with our guidance by submitting all necessary documentation accurately.
4. Approval and closing
Once your application is approved, we’ll walk you through closing to complete your loan and make that dream of a house or cash-out refinance in California a reality.
Get Started Today
Are you ready to take advantage of an asset-depletion mortgage in California? Contact ID Mortgage Broker today to get the process started. Call 323-741-5858 or visit our office at 1810 W Burbank Blvd #150, Burbank, CA 91506
Our professionals are ready to assist you with the funding you need by using your assets to your benefit and helping you achieve your aspirations for homeownership or refinancing.
