{"id":3638,"date":"2019-05-02T01:55:57","date_gmt":"2019-05-02T01:55:57","guid":{"rendered":"https:\/\/dreamhomefinancing.com\/?p=3638"},"modified":"2022-09-05T06:40:42","modified_gmt":"2022-09-05T10:40:42","slug":"Do-Assets-Help-Get-A-Mortgage","status":"publish","type":"post","link":"https:\/\/dreamhomefinancing.com\/Do-Assets-Help-Get-A-Mortgage\/","title":{"rendered":"Do Assets Help to Get A Mortgage?"},"content":{"rendered":"<h1 style=\"text-align: center;\"><strong><span style=\"color: #000000;\"> <img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-3643\" src=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/Do-Assets-Help-to-Get-a-Mortgage.jpg\" alt=\"Do Assets Help to Get a Mortgage\" width=\"660\" height=\"400\" data-pin-description=\"Do Assets Help to Get a Mortgage #assets #mortgage\" srcset=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/Do-Assets-Help-to-Get-a-Mortgage.jpg 660w, https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/Do-Assets-Help-to-Get-a-Mortgage-300x182.jpg 300w\" sizes=\"(max-width: 660px) 100vw, 660px\" \/><\/span><\/strong><\/h1>\n<h2 style=\"text-align: center;\"><strong><span style=\"color: #000000;\">Do Assets Help to Get a Mortgage?<\/span><\/strong><\/h2>\n<p><span style=\"color: #000000;\">When applying for a mortgage, some people are uncomfortable divulging all of their personal information regarding income and assets. People often focus on their income and credit scores and less about the assets.<\/span><\/p>\n<p><span style=\"color: #000000;\">What you will find out is how important assets really are when getting approved for mortgage. Your assets can be a difference making compensating factor when your credit scores and income are lower than what the lenders prefer.<\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong>Do Assets Help to Get a Mortgage?<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\"><strong>Assets are a significant compensating factor when applying for a mortgage and can help you to get approved even if you have bad credit or low income.<\/strong><\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong>What are assets?<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\">There are many different types of assets, and the most common one that we all know about is the money in your bank accounts. In addition to cash, assets are essentially anything you own that has economic value. However, not all assets may be used to qualify for a mortgage.<\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong>What Type of Assets Do Banks Care About?<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\">Liquid assets are what will get a lender\u2019s attention. The benefit is they can be quickly liquidated to help make mortgage payments if needed. In the example of a vehicle above, sure it has value but the chances that someone will be able to sell their car quickly to make a mortgage payment is slim.<\/span><\/p>\n<p><span style=\"color: #000000;\">If you aren\u2019t sure which of your assets are liquid, just imagine that you were randomly fired today (hopefully that doesn\u2019t happen), what assets could you quickly turn into cash to live off of?<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>Examples of liquid assets that can help you to qualify for a mortgage: <img loading=\"lazy\" decoding=\"async\" class=\"alignright size-medium wp-image-3645\" src=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/do-assets-help-get-a-mortgage-compressed-147x300.jpg\" alt=\"do assets help get a mortgage\" width=\"147\" height=\"300\" data-pin-description=\"do assets help get a mortgage #mortgage #assets #homebuying\" srcset=\"https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/do-assets-help-get-a-mortgage-compressed-147x300.jpg 147w, https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/do-assets-help-get-a-mortgage-compressed-502x1024.jpg 502w, https:\/\/dreamhomefinancing.com\/wp-content\/uploads\/2019\/05\/do-assets-help-get-a-mortgage-compressed.jpg 735w\" sizes=\"(max-width: 147px) 100vw, 147px\" \/><\/strong><\/span><\/p>\n<ul>\n<li><span style=\"color: #000000;\">Bank accounts- checking and savings<\/span><\/li>\n<li><span style=\"color: #000000;\">Investments in stocks, bonds, CDs, or retirement 401k accounts<\/span><\/li>\n<li><span style=\"color: #000000;\">Real estate<\/span><\/li>\n<li><span style=\"color: #000000;\">Any other liquid asset<\/span><\/li>\n<\/ul>\n<p><span style=\"color: #000000;\"><strong>Examples of assets that lenders will likely not take into consideration:<\/strong><\/span><\/p>\n<ul>\n<li><span style=\"color: #000000;\">Vehicles<\/span><\/li>\n<li><span style=\"color: #000000;\">Real estate<\/span><\/li>\n<li><span style=\"color: #000000;\">Collectibles such as vintage musical instruments and paintings<\/span><\/li>\n<\/ul>\n<p><span style=\"color: #000000;\">** The exception here is real estate. Lenders do like to see equity in other properties that you may own.<\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong>Do Assets Make You a Stronger Buyer?<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\">When you are purchasing a home, you may find yourself bidding against other buyers. If the offers are similar in price, sellers will likely go with the offer from the buyer who has a better chance at getting approved. The last thing a seller wants is for the buyer to <span style=\"color: #666699;\"><strong><a style=\"color: #666699;\" href=\"https:\/\/www.imagineyourhouse.com\/seller\/selling-a-home-and-the-buyer-defaults\/\" target=\"_blank\" rel=\"noopener\">default on the purchase<\/a><\/strong><\/span>.\u00a0<\/span><\/p>\n<h2><span style=\"color: #000000;\"><strong>Why Do Lenders Care About Assets?<\/strong><\/span><\/h2>\n<p><span style=\"color: #000000;\">The main reason that lenders look for assets is to determine whether you have the down payment and meet their reserve requirements. Lenders want to know if you have sufficient funds to make mortgage payments even if you have a temporary job loss because if you do, they will feel more at ease when approving your loan application.<\/span><\/p>\n<p><span style=\"color: #000000;\">If you can document enough liquid assets for at least 6 months reserves, then lenders may even overlook things such as bad credit and low income because your assets. Some mortgage programs already have minimum cash reserve requirements. As a result, building your cash reserves is an important <strong><a style=\"color: #000000;\" href=\"https:\/\/lakelandfloridaliving.com\/buying\/13-fast-track-tips-you-can-use-to-prepare-for-a-mortgage-application\/\" target=\"_blank\" rel=\"noopener\"><span style=\"color: #666699;\">mortgage application tips<\/span><\/a><\/strong> to strongly consider<\/span><\/p>\n<p><span style=\"color: #000000;\">There are even cases where retirees with only social security income are able to qualify for a mortgage because they have a strong portfolio of retirement savings and investments. This is just one example of how <span style=\"color: #666699;\"><strong><a style=\"color: #666699;\" href=\"https:\/\/www.comehomevirginia.com\/documenting-your-assets-verifying-your-down-payment\" target=\"_blank\" rel=\"noopener\">documenting your assets<\/a><\/strong><\/span> can help you to get a mortgage.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>Using Your 401k for a Down Payment<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">We have seen people cash out their 401k balances to use as their down payment to buy a home. We are not tax experts here but this is something you should talk about with your accountant. You could face a significant tax penalty by pulling your money out of your 401k before you reach retirement age.\u00a0<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>What are seasoned assets?<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">Seasoned assets have to do with how long the assets have been in our account. This typically refers to your bank account balances. Lenders want to see account balances be consistent across the statements that you provide. As a result, any recent large deposits may not be considered.<\/span><\/p>\n<p><span style=\"color: #000000;\">If you received a recent large deposit that will not continue each month, then you should consider waiting a couple of months for that deposit to drop off of the recent statements. Lenders will ask for 2-3 months bank statements.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>Asset Gifts from Relatives<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">If you are low on liquid assets, you may receive a gift from a relative to help cover your down payment and closing costs. Even if you do not need that gift to close the loan, it will add to your total liquid assets on your mortgage application. This could also help with your loan approval.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>Asset Based Mortgages<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">If you have little to no income but have a high level of liquid assets, then you may be able to qualify for an asset-based mortgage. With this type of loan, the lender will use a calculation (based upon your total liquid assets) to come up with the total amount you can borrow.<\/span><\/p>\n<p><span style=\"color: #000000;\">These types of mortgages are not common and only certain niche lenders have them. They are becoming popular with retired individuals who are receiving little in retirement income but have high levels of liquid assets. You can expect the interest rate on asset-based mortgages to be a bit higher.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>How Do Liabilities Affect A Mortgage Application?<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\">We\u2019ve talked a lot about assets, so it\u2019s important to also mention the liabilities because they also impact your ability to qualify for a mortgage. Liabilities are debts that are unpaid.<\/span><\/p>\n<p><strong><span style=\"color: #000000;\">The most common liabilities on your credit report are:<\/span><\/strong><\/p>\n<ul>\n<li><span style=\"color: #000000;\">Mortgages<\/span><\/li>\n<li><span style=\"color: #000000;\">Student loans<\/span><\/li>\n<li><span style=\"color: #000000;\">Auto Loans &#8211; <strong>Read [<a href=\"https:\/\/dreamhomefinancing.com\/mortgage-with-a-car-loan\/\"><span style=\"color: #0000ff;\">getting a mortgage with a car loan<\/span><\/a>]<\/strong><\/span><\/li>\n<li><span style=\"color: #000000;\">Credit Card Minimums<\/span><\/li>\n<\/ul>\n<p><span style=\"color: #000000;\">From a mortgage underwriting perspective, lenders will only look at the liabilities that appear on your credit report. They look at the minimum required monthly payments. Those monthly payments are used in the calculation of your <a href=\"https:\/\/dreamhomefinancing.com\/high-dti-mortgage-lenders\/\"><span style=\"color: #666699;\"><strong>debt to income ratio<\/strong><\/span><\/a>. Reducing these monthly liabilities will also be an advantage for you in combination with having assets.<\/span><\/p>\n<h3><span style=\"color: #000000;\"><strong>Related Questions<\/strong><\/span><\/h3>\n<p><span style=\"color: #000000;\"><strong>Can you get a mortgage with no assets? <\/strong><\/span><\/p>\n<p><span style=\"color: #000000;\">The chance of getting a no asset loan is extremely small because of the supreme lending financial crisis of 2008. A true <a href=\"https:\/\/dreamhomefinancing.com\/LoworNoDocumentLoans.aspx\"><span style=\"color: #666699;\"><strong>no doc loan<\/strong><\/span><\/a> for primary residences does not exist anymore. There are creative ways to find a mortgage without having too many assets. An example is detailed in this article about <a href=\"https:\/\/dreamhomefinancing.com\/FHA-No-Money-Down\/\"><span style=\"color: #666699;\"><strong>how to get an FHA loan without using your own money<\/strong><\/span><\/a>.<\/span><\/p>\n<p><span style=\"color: #000000;\"><strong>Is my car an asset that can be used to qualify? <\/strong><\/span><\/p>\n<p><span style=\"color: #000000;\">Your car is an asset, but it is not an asset that helps you to qualify for a mortgage. Your vehicles cannot be used as collateral for a mortgage either. There are self-employed individuals who have many vehicles for their businesses. Even though those vehicles may be worth a lot, they cannot use them as a basis to qualify for a mortgage. The same with your personal car.<\/span><\/p>\n<h3><span style=\"color: #000000;\">Are Asset Depletion Loans Available?<\/span><\/h3>\n<p><span style=\"color: #000000;\">There are asset depletion loans offered by various <strong><span style=\"color: #0000ff;\"><a style=\"color: #0000ff;\" href=\"https:\/\/dreamhomefinancing.com\/portfolio-lenders\/\">portfolio lenders<\/a><\/span><\/strong> where they will use your net liquid assets to determine how much you qualify for. <strong>Read [<a href=\"https:\/\/dreamhomefinancing.com\/asset-depletion-loans\/\"><span style=\"color: #0000ff;\">Asset Depletion Loans<\/span><\/a>]<\/strong><\/span><\/p>\n<h3><span style=\"color: #808000; font-size: 18pt;\"><strong>Related Articles<\/strong><\/span><\/h3>\n<p><a href=\"https:\/\/dreamhomefinancing.com\/the-best-mortgage-program-for-first-time-home-buyers\/\"><span style=\"color: #666699;\"><strong>What is the Best Mortgage Program for First Time Home Buyers?<\/strong><\/span><\/a><\/p>\n<p><a href=\"https:\/\/dreamhomefinancing.com\/LowDownPaymentMortgages.aspx\"><span style=\"color: #666699;\"><strong>Low Down Payment Mortgage Options<\/strong><\/span><\/a><\/p>\n<p><span style=\"font-size: 18pt; color: #808000;\"><strong>Discussion Topics<\/strong><\/span><\/p>\n<p><strong><a href=\"https:\/\/dreamhomefinancing.com\/category\/Mortgage-Advice\/\">Mortgage Advice<\/a><\/strong><\/p>\n<p><strong><a href=\"https:\/\/dreamhomefinancing.com\/category\/Buying-a-Home\/\">Buying a Home<\/a><\/strong><\/p>\n<p><strong><a href=\"https:\/\/dreamhomefinancing.com\/category\/Home-Improvement\/\">Home Improvement<\/a><\/strong><\/p>\n<p><strong><a href=\"https:\/\/dreamhomefinancing.com\/category\/Real-Estate\/\">Real Estate<\/a><\/strong><\/p>\n<p><strong><a href=\"https:\/\/dreamhomefinancing.com\/category\/Home-Finances\/\">Home Finances<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Do Assets Help to Get a Mortgage? When applying for a mortgage, some people are uncomfortable divulging all of their personal information regarding income and assets. People often focus on&#8230;<\/p>\n","protected":false},"author":1,"featured_media":3643,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_kadence_starter_templates_imported_post":false,"_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"","_kad_post_sidebar_id":"","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"footnotes":""},"categories":[191],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts\/3638"}],"collection":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/comments?post=3638"}],"version-history":[{"count":14,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts\/3638\/revisions"}],"predecessor-version":[{"id":5439,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/posts\/3638\/revisions\/5439"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/media\/3643"}],"wp:attachment":[{"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/media?parent=3638"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/categories?post=3638"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dreamhomefinancing.com\/wp-json\/wp\/v2\/tags?post=3638"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}