Asset Depletion Mortgages In Georgia — The Quick Read: Asset depletion turns liquid assets into a monthly income number a lender can use instead of pay stubs or traditional personal-income documentation. Not every account qualifies, and the ones that do usually get discounted before they count. Retirement funds, brokerage accounts, and cash typically qualify at reduced values; real estate equity, unvested stock, business equity, and most cryptocurrency generally do not. Georgia borrowers work with the same national playbook — there’s no separate state rulebook, just federal guidance and each lender’s own written policy.
Key Takeaways
- Asset depletion converts liquid assets into imputed monthly income by dividing a net asset figure by a set number of months — the divisor.
- Cash accounts usually count near full value; retirement and brokerage assets are typically discounted, often to somewhere in the 60%–70% range for borrowers under retirement age.
- Real estate equity, unvested stock options, lawsuit and lottery proceeds, and most crypto holdings generally don’t count as depletable income.
- Agency-style programs divide by the full loan term (as long as 360 months); non-QM programs commonly use much shorter divisors, which produces a bigger monthly income number off the same asset pool.
- Georgia carries no separate asset-depletion rulebook — the same federal guidance and lender-specific policies apply here as anywhere else.
What an Asset Depletion Mortgage Actually Solves
Picture a borrower with $2 million in brokerage and retirement accounts, but almost no traditional employment income. On paper, they don’t look creditworthy — even though they may actually be one of the strongest borrowers in the file cabinet. Conventional underwriting wants documented income. Asset depletion exists to fix that mismatch. It takes a pile of verifiable liquid assets and turns a slice of it into a monthly income figure the lender can use for qualification.
This works very differently from a DSCR loan. A DSCR loan qualifies mainly on whether the property’s rental income covers the payment, subject to lender guidelines. It doesn’t look at the borrower’s personal balance sheet at all. Asset depletion qualifies the person. DSCR qualifies the property. Investors sometimes need both tools — asset depletion on a personal residence, and DSCR on the rental portfolio. Mixing up these two approaches is a common mistake, and an avoidable one. Lendmire’s complete DSCR loans guide explains how property-income qualification works, for anyone weighing the two paths side by side.
Key Terms Defined
Asset depletion (or asset dissipation): a qualification method that converts a borrower’s liquid assets into an imputed monthly income figure instead of using pay stubs or traditional personal-income documentation.
Divisor: the number of months a lender divides net qualifying assets by to produce the monthly income figure — a shorter divisor produces a bigger monthly income number off the same asset pool.
Haircut: the percentage discount applied to a volatile or less-liquid asset class before it counts toward qualification — cash usually gets little or no haircut; retirement and brokerage funds usually get a bigger one.
Reserves: liquid funds a borrower must have left over after closing, held as a cushion in case income or rent falls short.
Debt-to-income ratio (DTI): the share of a borrower’s monthly gross income that goes toward debt payments, capped by most programs at a set ceiling.
Non-QM (non-qualified mortgage): a loan underwritten outside the standard federal qualified-mortgage box, using alternative documentation like bank statements, assets, or property cash flow instead of the usual pay-stub-and-tax-return file.
How Underwriting Actually Treats an Asset Depletion File
Every asset depletion file runs through the same sequence, whether the lender is a large bank, a portfolio investor, or a non-QM shop. The variables change; the steps don’t.
Step 1 — sort assets into eligible and ineligible buckets. Checking, savings, money market, brokerage, and retirement accounts are the standard eligible pool. Real estate equity, closely held business equity, and most personal property fall outside it.
Step 2 — apply a haircut by asset type. Cash typically counts near 100%. Stocks, bonds, mutual funds, and vested retirement assets are usually knocked down — commonly into the 60%–70% range for a borrower under retirement age.
Step 3 — net out committed funds. Money already earmarked for the down payment, closing costs, or required reserves comes out of the pool before anything gets divided. Gift funds, borrowed funds, and anything pledged as collateral elsewhere typically get excluded too.
Step 4 — divide by the program’s divisor. This is the step that decides how much monthly income the same pile of assets produces. Under Fannie Mae’s employment-related-assets method, the divisor is the full loan amortization term — a borrower with $360,000 in eligible liquid assets divided by a 360-month term produces a modest qualifying income figure, according to a worked example from getblueprint.io. Non-QM programs commonly use much shorter divisors, which stretches the same asset base into a meaningfully larger monthly figure.
Step 5 — layer with other income, if any exists. Social Security, pension income, part-time wages, and rental income can typically stack on top of the asset-based figure rather than replace it.
Documentation. Underwriters want complete, unbroken statements — every page, including any page marked blank. A missing page is one of the most common reasons these files stall in underwriting.
Our wholesale network treats assets as one way to qualify, among several. Some lenders use asset allowance math to boost modest documented income. Others let strong liquidity carry the whole file on its own, with no other income needed.
Which Assets Count — and at What Value
| Asset Type | Typically Counts? | Rough Treatment |
|---|---|---|
| Checking, savings, money market | Yes | Counted near full value |
| Brokerage / stocks / bonds / mutual funds | Yes, discounted | Haircut applied, often 60%–70% under retirement age |
| Retirement accounts (401(k), IRA) | Yes, discounted | Often 70% under retirement age, higher once penalty-free |
| Real estate equity | No | Not treated as a depletable liquid asset |
| Business equity | No | Excluded — a business isn’t a liquid personal asset |
| Unvested stock / stock options | No | Not vested, not accessible, not eligible |
| Lawsuit / lottery / inheritance / divorce proceeds | No | Generally excluded under agency-style rules |
| Cryptocurrency | Rarely for income | Some programs allow limited use toward reserves only |
Trust accounts, jointly held accounts, and pledged or encumbered balances create their own wrinkle. Programs generally want sole ownership and unrestricted access before a balance counts at all — a joint account or a balance tied up in certain trust structures can get reduced or excluded outright, depending on the program.
The Structures and Variations That Actually Exist
There isn’t one asset depletion formula — there are several, and the differences are large enough to change what a borrower qualifies for by a wide margin.
Agency-style (full-term divisor). Fannie Mae’s employment-related-assets method, detailed in its Selling Guide, divides eligible assets by the full loan amortization term — as long as 360 months on a standard 30-year loan. That’s a conservative divisor, and it produces the smallest monthly income figure of any common method. Freddie Mac runs its own version under Section 5307.1 of its Seller/Servicer Guide, with its own asset categories, its own net-documented-assets calculation, and its own age conditions — the two GSEs aren’t identical, which matters if a borrower assumes “agency” means one uniform rule.
Non-QM, shorter divisors. Non-agency programs commonly use divisors well short of 360 months, which produces a materially larger monthly income figure off the same asset base — useful for a borrower who’s asset-rich but wants a bigger coverage figure than the agency math would ever produce.
Lendmire’s wholesale network runs two distinct asset-based paths, both for primary and second homes only, capped at 80% loan-to-value. The asset allowance path divides liquid assets by 36 months when used as a supplement to other income and the debt-to-income ratio sits at or below 60%, by 60 months when used as a supplement above that DTI threshold, or by 84 months when it stands alone or the loan amount runs above $3,500,000. Retirement accounts count at 70% of value, stepping up to 80% once the borrower reaches 59½. Business funds, gift funds, trusts other than a revocable living trust, unvested stock, and cryptocurrency never count in that calculation.
Some borrowers have so much liquidity that they can skip the DTI conversation entirely. For these borrowers, select programs in the network offer an assets-only path. There’s no DTI calculation at all — you just need U.S. liquid assets equal to the loan amount plus closing costs. If you already own other residential property that’s running a net loss, add sixty months of covering that loss too. This is a narrow tool built for a specific kind of file: heavy liquidity, light or complicated documented income, and a borrower who’d rather prove capacity with a balance sheet than a pay stub.
Where the General Rule Breaks
The clean version of asset depletion — “count your liquid assets, divide, done” — breaks down in a handful of predictable places.
Age changes the math on retirement funds. Under the general framework, retirement account distributions carry an early-withdrawal penalty before a certain age, and programs typically discount the account value more heavily until that age passes. One misconception worth correcting directly: the widely repeated claim that Freddie Mac requires a borrower to be 62 before using assets as income applies narrowly to depository accounts and securities under its updated guide — it doesn’t apply to retirement assets, which carry their own separate conditions around vesting and access rather than a flat age cutoff.
Crypto is the newest fault line. Fannie Mae’s rule excludes virtual currency entirely — not eligible as income, not eligible as an asset for this method. Across the non-QM market more broadly, cryptocurrency is increasingly showing up as an allowance toward reserve requirements rather than as depletable qualifying income — a meaningfully smaller role than borrowers sometimes expect walking in. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
Unvested compensation and windfalls don’t convert. Stock options that haven’t vested, restricted stock still under a vesting schedule, lawsuit settlements, lottery winnings, and inheritance proceeds are commonly excluded from the depletion calculation outright — even though all of them might reasonably show up on a personal balance sheet.
Investment property doesn’t fit the tool at all. Asset depletion, as built by the agencies and mirrored by most of the market, is designed for owner-occupied and second-home purchases — not for financing a rental property. That’s precisely why DSCR exists as a separate product line: a rental purchase is reviewed on the subject property’s own rent-to-payment math, not on the borrower’s asset base. Anyone comparing the two products directly should look at Lendmire’s breakdown of DSCR loans versus asset depletion loans before assuming one can substitute for the other.
Trust and ownership structure can quietly disqualify a balance. Programs generally require sole, unrestricted ownership. A balance sitting in certain trusts, held jointly, or pledged as collateral elsewhere often gets reduced or dropped from the calculation even though the money is technically “there.”
What the Investor Decision Actually Looks Like
For a real estate investor, asset depletion rarely qualifies the rental purchase itself — it shows up in two adjacent, very practical spots.
First, think about reserves and funds-to-close on a rental file. An investor may be asset-heavy but show thin or irregular personal income. This is common for retirees, business owners with heavy write-offs, and high-net-worth individuals generally. Even so, they may still need to show reserve months on a rental purchase. Which asset class counts toward that reserve requirement — and at what discounted value — directly changes how much cash needs to sit in reserve, versus how much can go toward the purchase itself.
Second, think about portfolio sequencing. Say an investor is buying a primary residence and adding to a rental portfolio at the same time. They may use an asset-based path for the owner-occupied purchase, while financing the rental separately through property-income qualification. Knowing which product fits which property type from the start helps you avoid submitting the wrong file to the wrong program — and losing time over a mismatch.
Your choice of divisor can change the imputed monthly income a lot. Using a 60-month calculation instead of a 360-month calculation on the same asset pool can change the result by a multiple of six or more. That’s the one detail worth asking about before comparing any two asset depletion offers. The divisor decides the coverage figure — not the headline description of the program.
Georgia doesn’t have its own asset-depletion rules. Federal guidance and each lender’s written policy apply the same way here as in any other state. Lendmire’s consumer mortgage lending covers 16 states, including Georgia, Alabama, California, Colorado, Florida, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia, and Washington. If you want to compare this program across state lines, check Lendmire’s Colorado asset depletion breakdown to see how the same rules play out there.
Tax treatment can depend on how funds are used and how a property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Frequently Asked Questions
Does asset depletion work for financing a rental property?
Rarely as the primary qualification tool. Rental purchases typically qualify through DSCR programs on the property’s own rent-to-payment ratio, subject to lender guidelines, rather than through a borrower’s personal asset base. Asset depletion is built around owner-occupied and second-home purchases.
How much does the divisor actually change my coverage figure?
A great deal. A shorter divisor spreads the same asset pool over fewer months, producing a larger monthly income figure; a longer divisor, like the full loan term used in agency-style calculations, produces a smaller one. Two programs quoting “asset depletion” on the same asset base can land on very different qualifying numbers depending on this one variable.
Can I combine asset depletion income with Social Security or a pension?
Generally, yes. Most programs allow asset-based income to be layered on top of other verified income sources rather than replacing them, which can meaningfully increase total qualifying income for a retiree or a borrower with a mix of income types.
Do I have to liquidate my assets to use them?
No. Asset depletion counts the value of the assets for qualification purposes; the borrower keeps the accounts invested and doesn’t have to sell anything to close the loan.
Does cryptocurrency count toward my qualifying income?
Generally not as depletable income under most programs, though some non-QM lenders in the broader market allow limited crypto use toward reserve requirements without liquidating the holding. That’s a narrower use than counting it as income.
If you’re weighing an asset-based purchase against a straightforward rental-property loan, Lendmire can help compare how the numbers work across property income, credit profile, leverage, and investor goals before choosing a path.
For current guidelines and terms, see Lendmire’s super jumbo bank statement loan programs page.
Self-employed borrowers can compare both super jumbo programs on Lendmire’s self-employed mortgages page.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage brokerage specializing in DSCR investor loans, helping arrange financing across 40 markets, including Washington, D.C., through wholesale and investor-lending channels. The model centers on property-level rental income reviewed by the lender rather than W-2 documentation, subject to lender guidelines, suiting entity-owned and multi-property investors. Lendmire holds Scotsman Guide Top Mortgage Workplace recognition for 2025 and 2026.
Lendmire’s Top Mortgage Workplace recognition is documented by Scotsman Guide 2025 Top Mortgage Workplace and Scotsman Guide 2026 Top Mortgage Workplace.
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References
1. getblueprint.io – Fannie Mae Asset Depletion Example
3. Freddie Mac Single-Family Seller/Servicer Guide – Section 5307.1, Assets
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.
