What is an Asset Depletion Mortgage Loan?
An Asset Depletion Mortgage loan is a type of home loan that allows borrowers to qualify based on their liquid assets rather than their income. This method calculates the borrower’s ability to repay the loan by depleting their assets over a specified period, typically the term of the loan. It's ideal for individuals who have significant savings, investments, or other liquid assets but may not have a steady income stream.

Benefits of an Asset Depletion Mortgage Loan
Asset Depletion Mortgage loans offer several significant benefits:
- Qualification Based on Assets: Allows borrowers to leverage their liquid assets to qualify for a mortgage, making it easier for retirees, investors, or individuals with substantial savings to obtain a loan.
- Flexibility: Provides an alternative qualification method for those without traditional income documentation, such as pay stubs or tax returns.
- Utilization of Investments: Enables borrowers to use their investment portfolios and savings accounts to meet loan requirements.
- Higher Loan Amounts: Potentially allows for higher loan amounts based on the value of the assets.
Who Qualifies for an Asset Depletion Mortgage Loan?
To qualify for an Asset Depletion Mortgage loan, borrowers typically need to meet the following criteria:
- Significant Liquid Assets: Must have substantial liquid assets, such as savings, investment accounts, or retirement funds.
- Stable Financial History: Demonstrated financial stability, often shown through asset statements and credit history.
- Good Credit Score: A good credit score is generally required, although the exact minimum score can vary by lender, 680 should be the minimum with most lenders.
- Sufficient Assets: The value of the assets must be sufficient to cover the loan amount over the term of the mortgage.
Requirements for an Asset Depletion Mortgage Loan
When applying for an Asset Depletion Mortgage loan, borrowers need to provide:
- Asset Statements: Documentation of liquid assets, such as bank statements, investment account statements, and retirement account statements.
- Credit Report: A credit report to assess creditworthiness and ensure a good credit history (this will be pulled by your lender).
- Personal Identification: Valid photo ID to verify identity.
- Asset Depletion Calculation: Lenders will calculate the monthly income equivalent by dividing the total liquid assets by the term of the loan (e.g., 360 months for a 30-year mortgage) in some instances, others will divide the assets by 270 months for a greater income calculation.
An Asset Depletion Mortgage loan is an excellent option for individuals with significant liquid assets who may not have a steady income. By focusing on the borrower’s assets rather than traditional income, these loans provide a flexible and accessible path to homeownership for a diverse range of borrowers.
For more information or to start your application, contact MORTGAGEinc today, info@mortgage-inc.com!