Asset Depletion Program
| North Star Mortgage offers an aggressive asset depletion program that can be combined with all other programs and income! An asset depletion mortgage is a type of home loan designed for borrowers who may not have a regular income but possess substantial financial assets. This mortgage allows borrowers to qualify for a loan based on the value of their assets rather than their income. Here’s how it generally works: Asset Calculation: The lender assesses the borrower’s liquid assets (such as savings accounts, stocks, bonds, and retirement accounts). They calculate a monthly income equivalent based on these assets. Depletion Method: The calculated monthly income is based on the asset depletion method. Typically, the lender will take a portion of the borrower’s assets and spread it out over a certain number of months or years. For example, if a borrower has $1 million in assets and the lender uses a 10-year (120-month) depletion period, they might consider $8,333 per month as income. Loan Qualification: This “income” from asset depletion is used to qualify the borrower for the mortgage. The borrower’s financial stability is assessed based on this calculated income rather than traditional income documentation like pay stubs or tax returns. Requirements: Lenders may have specific requirements for asset depletion mortgages, such as a minimum asset threshold, higher credit scores, and down payments. They may also require that the assets be readily accessible and not tied up in illiquid investments. Advantages: Useful for retirees or individuals with substantial savings but irregular income. Can provide an option for borrowers who might not qualify for a traditional mortgage due to lack of documented income. Disadvantages: Might come with higher interest rates or more stringent requirements. The calculation of income based on asset depletion might not be as favorable as traditional income-based qualifications. If you’re considering this type of mortgage, it’s a good idea to consult with a financial advisor or mortgage specialist to ensure it fits your financial situation and goals. |
| Program Highlights include: –Loans up to $5,000,000 including cash out refinances -Only one appraisal required regardless of loan size -IRA, 401k and other retirement assets may be used regardless of a borrower’s age –Cash out can be used as asset depletion income either as addition income or as stand alone income (possible reverse mortgage alternative) –Stocks, Bonds, Mutual Funds etc. used at full face value –No credit score borrowers and scores to 600 including Jumbo cash out –Non-Occupying co-borrowers allowed including Jumbo cash out –Can be combined with our One Year Self Employed/One Year Tax Return Program –RSU awards (Restricted Stock Units), stock options and deferred compensation tied to stock considered for income or as an asset for depletion –No US Credit or Credit Score, Expat, Work Visa, EAD and other Work Authorization allowed –Program allows unique collateral including: Non-Warrantable Condos, Co-ops, Condotels, Mixed-Use, Unpermitted ADUs, Manufactured ADUs, Acreage / Hobby-Farms etc. –TBD pre-approvals provided |
| Call us today to review your unique scenario! 904-880-6741 |
