Direct from our Loan Development Team – we have created a solution which allows our international high-net-worth clients to use their liquid asset portfolio to qualify for a U.S. mortgage loan without pledging or encumbrance, nor the requirement of any minimum deposit held at a bank (AUM).
Introducing “GMG U.S. Super-Jumbo+" & "LADMI"
- Are you a businessperson with low reported income?
- Are you retired with little to no fixed income?
- Are you self-employed but with little to no “provable” income?
- Are your assets held in a bank with a U.S. branch or presence?
- Do you have Trust assets with completely unrestricted use?
If you answered Yes to any of these questions, you will qualify for this program.
Asset Rich, but Cash Poor?
It’s a common issue for high-net-worth investors who report low income but have sizeable asset portfolios including stocks, bonds and other liquid securities.
Traditional banks require pay stubs, employment letters, and credit scores (we have fantastic programs for this as well), but many of our clients are not in the corporate world and require more flexible programs to suit their specific needs.
Separately, private banks will undoubtedly require Assets Under Management (AUM) and normally at least the amount of the mortgage.
We are seeing a trend that high-net-worth investors are now open to looking at financing options outside of their private bank, even if the rate is higher than the subsidised rate they would get from their private bank.
“A small price for freedom,” as one of our European clients recently told us.
Introducing: Liquid Asset Derived Monthly Income “LADMI”
Salient Points:
- Qualify for a loan using your liquid asset portfolio instead of income from employment.
- No AUM (Assets Under Management) or encumbrance of your portfolio at all, rather, it is ‘only’ to qualify for a loan.
- Liquid Asset Derived Monthly Income (LADMI) is calculated by taking total liquid assets and dividing by the duration of most mortgage loans, 360 months (30 years).
- LADMI allows you to prove your ability to service the debt without regular income from employment – great for entrepreneurs and high-net-worth investors!
- No need to show any other sources of income or employment.
- If your LADMI is sufficient to service the mortgage – as well as regular living expenses – you can qualify based solely on this calculation.
- No need to cash-in your portfolio or encumber in any manner.
- Your assets are used “only to demonstrate” an ability to make the mortgage payments.
Commonly-used Liquid Assets:
- Checking or savings accounts
- Money market accounts
- Certificates of Deposit (CD)
- Investment accounts such as stocks, bonds, crypto, and mutual funds
- Liquid retirement accounts
[Note] All accounts, banks and or brokerages will be required to have a U.S. presence. IE Fidelity, Capital, Coinbase, Charles Schwab, HSBC etc.
Here is an example:
59-year-old mortgage borrower has:
- Cash: $750,000
- Investment portfolio: $3,500,000
- Cryptocurrency: $300,000
- Liquid retirement fund: $500,000
= Total Liquid Assets: $4,300,000 (2+3+4)
This is how we calculate LADMI:
- Cash: $750,000
- Total Liquid Assets: $4,300,000
- Discount Factor: 30%
- Discounted Liquid Asset Value: $4,300,000 x 70% = $3,010,000
= Total Allowable Assets: $3,010,000 + $750,000 = $3,760,000
= LADMI = $3,760,000/360 months = $10,444
In this case, we will calculate the borrower’s maximum mortgage payment based on a monthly ‘income’ of $10,444.
The next question you will ask is, what kind of property can this get me?
If we assume a minimum 43% debt to income ratio (DTI) for most lenders and use the current market mortgage rate, you can qualify for a US$1M home (approximately $4,000 P+I monthly payment).
[Note] This is just an example and there are many factors that go into qualifying for a mortgage. This illustration is show that you do not need a salary to qualify for mortgages anymore thanks to our program.
If you have any questions about our GMG U.S. Super-Jumbo+, LADMI or any of our international mortgage or asset-backed financing solutions, please contact us at: [email protected] or send me a confidential Whatsapp at +65 8499-3229.
