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Question about asset depletion mortgage loan

What kind of assets are eligible? by rsmartin657 from San Diego, California. Jun 19th 2019 Reply

William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,728 contributions

Cash or brokerage accounts. and if you are retirement age, then your IRA's will qualify as well. The Rules are kinda goofy.. some lenders wont let you withdraw your down payment from the same account you are using for asset depletion, so it's best to have them separated before you apply. And if you are using an IRA.. then lenders will only consider 70% of the funds to be qualified. The thinking is that you will need to pay taxes on IRA withdrawals, so they don't give you 100% credit for the funds. Example of how this works. You want to buy a home using 30 year financing and you are 62 or older. Lets say you have 3 different asset accounts. The first account is a brokerage account with $100K in it.. this is the account you will use for your down payment. The 2nd account is another brokerage account with $360K in it.. and the 3rd account is an IRA with $360K in it. For income, the lender will not give you credit for the $100K account because the down payment is coming out of it.. The lender will give you $1000 per month credit for the 2nd account.. and the 3rd account, you would get a $700 income credit since it's an IRA.. So your total qualifying income from asset depletion would be $1700 per month. I hope this helps.. I'm a preferred Lender with California and Arizona being my primary markets. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 NMLS# 226347 / LendUS, NMLS 1938/ AZMB0121893

Jun 21st 2019
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