An asset-based loan or asset utilization loan uses the assets as income. Perhaps you are a retiree with a small fixed income, or own a business or an established company that needs to maintain a high cash flow, the ease and benefits of asset-based loans and mortgages have made them a popular solution for borrowers in recent years.
Benefits of an Asset Based Loan
Qualified based on verified liquid assets
Loan amounts up to $3 million
Minimum 620 credit score
No employment or income. The ability to repay is simply determined by assets
No tax return or 4506T required
In most cases, the debt to Income (DTI) Ratio not calculated
As little as 20% down payment
Cash out is allowed
What Assets Are Considered?
The types of liquid assets that can be used as collateral are checking accounts, savings accounts, certificates of deposit (CDs), money market accounts, mutual funds, stocks, and bonds. In some cases, asset statements alone may be used by high-net-worth individuals for qualification.
It is important that the assets presented for your loan must be easily convertible into cash.
If you are retired, assets that can be counted toward your income include checking or savings accounts, certificates of deposit, investment accounts such as stocks, bonds or mutual funds as well as money market accounts.