Asset Depletion Loans In Bal Harbour — The Quick Read: an asset depletion loan lets a borrower qualify using liquid assets instead of pay stubs or traditional personal-income documentation. A lender takes a portion of your checking, brokerage, and retirement balances and turns it into a hypothetical monthly income figure. That figure gets tested against the loan payment the same way a paycheck would. You never sell or touch the actual assets — the math is a paper exercise, not a withdrawal.
Key Takeaways
- Asset depletion converts liquid balances into a calculated income figure — it does not require liquidating anything.
- Different programs use different divisors (commonly 36, 60, or 84 months in Lendmire’s network) and different discounts by asset type.
- Retirement accounts typically count at a reduced rate before age 59½ and a higher rate after.
- This is a borrower-capacity tool. It doesn’t replace a DSCR loan, which qualifies off the property’s own rent instead of your balance sheet.
- Loan amounts through select wholesale programs Lendmire works with run from $300,000 to $30,000,000, with leverage stepping down as size increases.
What Is an Asset Depletion Loan?
An asset depletion loan — sometimes called asset dissipation, asset utilization, or an asset qualifier — is a mortgage underwritten primarily on liquid assets rather than employment income. Instead of asking “how much do you earn,” the lender asks “how much do you hold, and how long could it support a payment.”
This matters for a specific type of borrower: someone with real wealth but thin income documentation. Think of a retiree living off a brokerage account. Or a founder who reinvests most of the company’s profit instead of drawing a salary. Or an investor whose traditional personal-income documentation shows heavy depreciation and write-offs that mask actual cash flow. All three might get turned down on a standard income-based application, even though they could comfortably carry the payment.
Key Terms Defined
Liquid assets — cash, brokerage holdings, and retirement funds that can be converted to cash without selling real estate or a business.
Divisor — the number of months a lender divides your eligible asset balance by to produce a monthly qualifying income figure. Shorter divisors produce a larger monthly figure; longer divisors produce a smaller one.
Haircut (or discount) — the percentage reduction applied to a given asset type before it counts toward the qualifying pool. Volatile or restricted assets get discounted more than cash.
DSCR (debt service coverage ratio) — the ratio a rental property’s income produces against its own payment. It is the metric behind DSCR loans, a separate qualification path from asset depletion.
How Underwriting Actually Treats It, Step By Step
The process is consistent across the wholesale programs Lendmire places files with, even though the exact numbers shift by lender.
First, the underwriter builds a list of eligible accounts — checking, savings, brokerage, and vested retirement funds. Business equity, real estate equity, and unvested compensation don’t count. They can’t be converted to cash on a predictable timeline. Cryptocurrency and gifted or trust funds (outside a revocable living trust) are excluded on every program in Lendmire’s network.
Second, each asset type gets discounted for liquidity and volatility risk. In the programs Lendmire arranges, retirement accounts typically count at 70% of value, rising to 80% once the account holder reaches 59½ — the discount reflects early-withdrawal penalty exposure. Cash and cash equivalents generally count closer to full value.
Third, funds already earmarked for the down payment and closing costs get carved out before the income math runs. A dollar can’t fund the closing table and generate qualifying income at the same time.
Fourth, the net eligible balance is divided by the program’s term. Lendmire’s network runs an asset allowance path off a 36-month divisor when it supplements other income and debt-to-income sits at or below 60%, a 60-month divisor when debt-to-income runs higher, and an 84-month divisor when the asset math stands alone or the loan amount exceeds $3,500,000. Shorter terms produce a larger monthly figure; that’s the trade-off borrowers negotiate around.
Fifth, the underwriter checks for double counting. Assets used for qualifying income shouldn’t also be counted as reserves. Interest or dividend income already reported on a tax return shouldn’t be added on top of the depletion figure. The file needs to show clearly which number is actually carrying it.
The Office of the Comptroller of the Currency describes how banks use this practice. It “uses an applicant’s assets to calculate a hypothetical cash annuity stream, which is added to the applicant’s other income when evaluating the applicant’s ability to make mortgage payments.” This is a real, supervised underwriting method. It’s not an improvised workaround.
The Structures and Variations
Lendmire’s wholesale network runs two distinct asset-based structures, and picking the right one depends on how much debt-to-income flexibility a borrower needs.
Asset allowance supplements other income sources. It’s built for someone with some documented income who needs the assets to close a gap. This path caps at 80% loan-to-value and applies to primary residences and second homes only.
Assets-only drops the debt-to-income calculation entirely. It requires U.S. liquid assets equal to the full loan amount, plus closing costs, plus sixty months of any net loss on other residential property the borrower holds. This is the strongest structure for a borrower with substantial wealth and genuinely no qualifying income at all.
Loan sizing on these files runs from $300,000 to $30,000,000 across two programs in Lendmire’s network — a portfolio non-QM program that carries files to $6,000,000, and a bank portfolio program built for twelve-month statement files that runs its own ladder to $30,000,000, stepping down from 65% at the $5,000,000 mark to 60% at $10,000,000 and 55% at $30,000,000, with interest-only capped at 60% loan-to-value or the band’s ceiling, whichever is lower.
Leverage on a primary residence steps down as the loan grows: typically 90% below $1,000,000, 85% approaching $2,000,000, and 75% at the top credit tier near $4,000,000. Above that, every file goes to case-by-case review before it’s even submitted — that’s true at every size on the bank program’s ladder as well. Second homes and investment properties generally run about five points lower in leverage at every size tier than a primary residence, subject to lender guidelines.
Where the General Rule Breaks
Asset depletion looks like a single, clean formula from the outside. It isn’t. Several genuine edge cases change how the math and the eligibility actually work.
There’s no industry-standard formula. The divisor and the discount percentage applied to each asset class are set by the individual lender, not by a federal rule. A borrower comparing two quotes is often comparing two entirely different assumptions, not two prices for the same product.
Occupancy limits differ sharply by program. The agency-style version of asset-based qualification — the one built into the Fannie Mae Selling Guide — generally confines itself to a primary residence or second home, excludes investment properties, and excludes cash-out refinances outright, because a cash-out draws down the very asset pool being used to qualify. Fannie Mae’s guide requires that when an asset account is the sole or majority source of qualifying income, the lender must assess whether the borrower can keep repaying once that asset is depleted before the loan matures. Non-QM programs, including the ones in Lendmire’s network, run independently of that agency framework and can extend to investment-property occupancy — but that has to be confirmed program by program, never assumed.
Retirement-account treatment shifts with age. Because early-withdrawal penalties reduce practical liquidity, a retirement account held by someone under 59½ typically counts for less toward qualifying than the same account held by someone past that threshold. This single detail can move a borrower from qualifying to not qualifying, or change which structure makes sense.
Combining income sources changes the picture. Many programs let asset-based income sit alongside Social Security, pension income, or part-time wages. Whether that’s allowed, and how it’s weighted, is program-specific — but where it’s permitted, it can meaningfully increase what a borrower qualifies for versus relying on assets alone.
Regulators watch this closely. The OCC issued its 2019 bulletin specifically because asset-dissipation underwriting had grown faster at some banks than their risk management could keep pace with. Under the broader Ability-to-Repay framework, a creditor is required to verify the income or assets it relies on “using third-party records that provide reasonably reliable evidence,” per 12 CFR § 1026.43. That’s the regulatory backdrop — documentation discipline matters, even on a wealth-based file.
Across the files the brokerage brokers, one pattern shows up most often. It isn’t a rejected borrower — it’s a borrower who assumed one lender’s divisor and discount would match another’s. They structured their offer around the wrong math before the numbers were actually run. Getting the program’s specific divisor and asset discounts confirmed before writing an offer avoids that entirely.
The Investor Decision: Which Path Actually Fits
Asset depletion, bank statement, and DSCR loans solve three different underwriting problems. The table below shows where each one earns its place.
| Factor | Asset Depletion | Bank Statement | DSCR |
|---|---|---|---|
| What’s evaluated | Borrower’s liquid assets | Borrower’s deposit history | Property’s rental income |
| Best fit | Retired or asset-rich, low income docs | Self-employed with strong deposits | Buying or refinancing a rental |
| Personal income needed | Little to none | Deposit-derived, not traditional personal-income documentation | None — property income drives it |
| Occupancy fit | Primary and second home strongest | Primary, second home, investment | Investment property only |
For a rental-property investor, this decision usually isn’t either/or. The property itself typically gets financed through a DSCR loan. This structure qualifies primarily on the property’s rental income covering its own payment, subject to lender guidelines, rather than the borrower’s personal balance sheet. The brokerage’s complete DSCR loans guide walks through how that qualification test works in detail. Asset depletion tends to show up alongside a DSCR file when the investor also needs to show personal reserves or creditworthiness. DSCR files still typically carry a credit and reserve overlay, even though the property carries the income test.
Trade press coverage frames this split cleanly: real estate investors lean on DSCR loans because they qualify on property cash flow, while asset-rich households — including a growing population of retirees — turn to asset depletion to preserve liquidity rather than draw down a portfolio, according to Scotsman Guide. Investors weighing both structures side by side can review the difference directly in Lendmire’s DSCR loan vs. asset depletion loan comparison.
Documentation for either path runs on 12 or 24 consecutive months of bank statements where income is involved, with transfers from a borrower’s own business into a personal account counting in full. Pricing and available terms vary by lender, borrower profile, property type, and full underwriting review.
Frequently Asked Questions
Do I have to sell my investments to use asset depletion?
No. The lender calculates a hypothetical monthly income figure from your balances — you keep the actual assets in place. “Depletion” describes the math assumption, not something that happens to your portfolio.
Is there one standard formula every lender uses?
No. The divisor and the discount applied to each asset type are set by the individual lender. Programs commonly divide by 36, 60, or 84 months in the brokerage’s network, and lenders in the market use different terms entirely — always confirm the specific numbers before comparing offers.
Can I use asset depletion to buy an investment property?
It depends on the program. The Fannie Mae version generally limits itself to primary residences and second homes. Non-QM asset-allowance and assets-only structures can extend further, subject to lender guidelines and program eligibility.
How are retirement accounts treated differently from cash?
Retirement funds typically get discounted for early-withdrawal penalty exposure before 59½, then count at a higher rate after that age. Cash and brokerage holdings are generally treated more favorably from the start.
Can asset depletion be combined with Social Security or other income?
Often, yes, subject to lender guidelines and program eligibility. Where allowed, blending sources can increase the size of loan a borrower qualifies for compared with relying on the asset calculation alone.
Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Are you weighing an asset-based purchase against financing a rental property on its own income? The brokerage can help you compare options based on your assets, credit profile, and the leverage available at your loan size. Reach the brokerage’s team through a quote request to walk through the specifics of your file.
For current guidelines and terms, see the brokerage’s super jumbo bank statement loan programs page.
Self-employed borrowers can compare both super jumbo programs on the brokerage’s self-employed mortgages page.
About Lendmire
Lendmire, NMLS# 2371349, is a mortgage brokerage focused on investor financing, arranging DSCR loans in 39 states plus Washington, D.C. — 40 markets total. Qualification is based on the property’s income rather than personal income documentation, subject to lender guidelines, making it a fit for LLC-held rentals and scaling portfolios. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Office of the Comptroller of the Currency — Bulletin 2019-36
2. Fannie Mae Selling Guide, B3-3.1-01
3. Scotsman Guide — Which groups are driving non-QM lending?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.
