The Quick Read: A bank statement loan is reviewed around the cash your business deposits, while an asset depletion loan is reviewed around the liquid wealth you already hold, and at a $5 million price the better choice usually follows where your money sits: in an operating business or in a portfolio. Both paths are reviewed case by case at this size. Any loan above $4,000,000 is reviewed before submission.
- Bank statement path: 12 or 24 months of deposits, reduced by an expense ratio, become your monthly qualifying income.
- Asset depletion path: eligible liquid assets are divided by 36, 60 or 84 months. Any loan above $3,500,000 uses the 84-month divisor.
- At this size: leverage steps down as the loan grows. On a primary residence purchase, ceilings drop to 65% above $4,000,000, on review.
- Same destination: both paths still run through credit, reserves, appraisal and a debt-to-income check.
Here is the honest answer. A bank statement loan fits a founder, physician, attorney or owner whose business pours cash through the accounts every month, while traditional personal-income documentation shows far less income than that. An asset depletion loan fits someone with a large brokerage or retirement balance and little earned income: a retiree, a founder after a sale, an investor living on gains. If you are both, you run both calculations and submit the stronger file. Neither is the easy road at $5 million. Each is a different way to prove the same thing.
Side-by-Side
The table below shows how the two paths differ on the points that matter at a high price. The figures reflect parameters through select wholesale programs, subject to full underwriting.
| Factor | Bank Statement Loan | Asset Depletion Loan |
|---|---|---|
| What it measures | Business or personal cash flow | Your liquid balance sheet |
| Core documents | 12 or 24 months of statements | Statements for eligible assets |
| Income math | Deposits after expense ratio | Assets divided by 36, 60 or 84 months |
| Ownership test | 25%+ for business statements | Assets held in your name |
| Occupancy | Primary, second home, investment | Primary and second homes only |
| What never counts | Non-income credits, loan proceeds | Business funds, gifts, crypto, unvested stock |
| Typical title | Individual or revocable trust | Individual or revocable trust |
| Main weak spot | Messy or falling deposits | Thin liquidity after costs and reserves |
How a Bank Statement Loan Turns Deposits Into Income
The lender adds up eligible deposits and divides by the number of statement months. Then it subtracts an expense ratio. That result is your qualifying income.
Across the wholesale network, most programs offer 12 or 24 consecutive months, and the bank portfolio program uses 12. The statements must be consecutive. A transaction history does not substitute for a statement.
On business statements, you need at least 25% ownership. The expense ratio depends on the business:
- 20% for a service business with no employees
- 40% for one to five employees
- 50% for six or more employees or any product business
- an accountant-provided ratio, when a CPA will put a number in writing
A profit-and-loss method is also available on some programs. Transfers from your own business into your personal account count in full. That detail helps owners who pay themselves in lumps.
Deposit quality decides the outcome. Underwriters look for steady, explainable deposits. Overdrafts, commingled personal spending, big unexplained transfers and a falling trend all draw extra questions. Trade press has been tracking this. Scotsman Guide reports that CPA and profit-and-loss loans, followed by 12- and 24-month bank statement loans, are a growing pocket of weakness compared with full-documentation and investor-purpose non-QM loans. Expect careful review, not a rubber stamp.
How an Asset Depletion Loan Turns Savings Into Income
The lender totals your eligible liquid assets, removes what the purchase itself consumes, and divides the rest over a fixed number of months. You keep the assets. You do not sell anything. The division is only a way to express wealth as monthly income.
Scotsman Guide describes this approach as turning idle brokerage and retirement balances into attributed income, so affluent clients such as retirees can preserve liquidity. The divisor is the lever. A shorter one produces more qualifying income. Market coverage from Scotsman Guide reports a standard divisor of 120 months, with some privately funded programs using 60. The network’s asset allowance works differently: it divides liquid assets by 36 months when assets supplement other income and DTI is at or below 60%, by 60 months when DTI is above 60%, and by 84 months when assets stand alone or the loan exceeds $3,500,000. It is available on primary and second homes only, to a maximum of 80%.
Not every dollar counts:
- Retirement accounts count at 70%, or 80% at age 59.5 and older.
- Business funds, gifts, unvested stock and cryptocurrency do not count.
- Trusts other than a revocable living trust do not count.
There is a second, stricter path: assets-only. It qualifies with no DTI when U.S. liquid assets equal the loan amount plus closing costs plus sixty months of any net loss on other residential property. It is demanding, and it is right for a few borrowers, who tend to know who they are.
One more catch. The divisor is keyed to the loan amount, not the price. A $5 million home with a sizable down payment can produce a loan at or under $3,500,000, where the 36- or 60-month divisors may still apply. Once the loan passes $3,500,000, the 84-month divisor applies and the asset base has to be large relative to the loan. The same assets also tend to double as reserves, so they can only do so much work at once.
When a Bank Statement Loan Is the Better Fit
Choose this path when your deposits tell a stronger story than your balance sheet or your traditional personal-income documentation.
- You own an operating business. Cash moves through it every month, and write-offs shrink the income on your returns. Deposits show the real flow.
- You pay yourself from the business. Owner transfers into a personal account count in full, which can lift the numbers.
- Your assets are tied up. Equity in a company, illiquid holdings and unvested stock do not count toward asset depletion. They may not matter on this path.
- You want to buy a rental or second home too. Bank statements work across primary, second-home and investment occupancy. Asset depletion is limited to primary and second homes.
- Your history is steady. A twelve-month statement file has to show a consistent pattern, ideally with no dips.
Be careful if the business is young, the deposits are lumpy, or personal and business money mix in one account. A 50% expense ratio on a product business can also cut qualifying income hard. Picture a founder whose business has more than six employees. Half of every eligible deposit disappears before the debt-to-income math starts. That owner might do better on assets. Run both.
When an Asset Depletion Loan Is the Better Fit
Choose this path when your wealth is liquid and your earned income is light, lumpy or recent.
- You are retired or semi-retired. Large brokerage and retirement balances, with little salary, are the classic profile.
- You just sold a company. The proceeds sit in a brokerage account, and the business no longer produces deposits.
- You live on investment gains. Your tax return may show modest income while your portfolio is large.
- You want to keep the portfolio invested. Asset depletion lets you buy without selling holdings to fund a bigger down payment. That choice stays yours. Plenty of buyers at this price simply pay cash. Borrowing makes sense when your investments earn more than the debt costs you, or when you do not want a large taxable sale.
- You have a primary or second home in mind. Asset depletion is limited to those occupancies.
Be careful if your assets are mostly unvested stock, business accounts, gifts or crypto. None of them count. Lendmire’s piece RSU Income on a Bank Statement Loan vs Asset Depletion After Vesting covers how vesting changes that picture. Also watch your post-closing liquidity. After the down payment, closing costs and reserves come out, what remains has to be large enough to carry the loan.
What a $5 Million Price Changes
Size changes the whole file, regardless of which path you pick. The leverage ladder is keyed to the loan amount, not the purchase price. How much you put down decides which band you land in.
Through select wholesale programs, subject to full underwriting, a primary residence purchase carries ceilings like these:
- 90% for loans to $1,000,000
- 85% to $2,000,000
- 80% to $3,000,000
- 75% to $4,000,000, at the top credit tier
- 65% above $4,000,000, reviewed case by case before submission
Second homes and investment property sit on their own ladders and have their own credit tiers. The size of the loan matters as much as the price on the contract. Above $4,000,000, nothing is flat or automatic. Every leverage figure is a ceiling on review.
The bank portfolio program carries twelve-month-statement files up to $30,000,000, on its own ladder of 65% to $5,000,000, 60% to $10,000,000 and 55% to $30,000,000. That ladder begins above $4,000,000 and overlaps the portfolio non-QM program, which carries files to $6,000,000. Interest-only on the bank program tops out at 60%.
Super-jumbo overlays kick in above $3,500,000 on a primary residence and above $3,000,000 on a second home or investment property:
- a 700 credit floor
- a clean 0x30x24 housing history
- 48-month seasoning after any credit event
- U.S. citizens and permanent residents only
- no non-occupant co-borrowers
- no rural property, with a ten-acre maximum
- cash-out proceeds that cannot satisfy reserves
Outside the super-jumbo band, the portfolio program’s credit floor is 660 and the bank program’s is 680. Debt-to-income runs to 50%. Reserves step up with size: 3 months to $500,000, 6 months to $1,500,000, and 9 months above that, plus 2 months for each additional financed property, to a 12-month maximum. First-time investors need 12.
Does Occupancy or Property Type Change the Answer?
Yes, and this is the biggest fork. Both paths qualify you personally, so both fit a home you will live in or use as a second home. A pure rental is different.
DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Sub-1.00 coverage is available through select lenders in the network, though loan-to-value (the share of the price you borrow) and terms adjust. If your $5 million purchase is a rental and your personal income is not the story, start with the complete DSCR loans guide.
Lenders also check how the loan will be used. The Consumer Financial Services Review notes that a lender on a non-QM file may consider income, assets or both. That is why these two alternative-documentation methods exist at all. For a primary or second home, you must show the lender a verified basis for repayment. The CFPB’s ATR/QM compliance guide says the creditor has to verify only the income or assets it relies on. Bank statements verify income. Asset statements verify assets. Either way, the paper trail is real.
On title, both methods typically close in an individual’s name or a revocable trust. LLC vesting is more often tied to business-purpose DSCR loans, subject to lender program eligibility.
One more practical point on property types. Warrantable condos run to 85% and non-warrantable condos to 80%. Two-to-four-unit properties run to 85%, though second homes are one-unit only. Texas 50(a)(6) home-equity loans take a 5-point reduction and stop at $3,000,000 on the portfolio program. A $5 million home is usually a single-family property, but check the rest if yours is not.
Can You Combine the Two or Switch?
Often, yes. Programs can blend income sources. The asset allowance itself is built as a supplement: liquid assets divided by 36 or 60 months can sit alongside bank-statement or other documented income. When the loan exceeds $3,500,000, the 84-month divisor makes the asset side heavier.
Think about three borrowers.
- The operating owner. Strong deposits, modest brokerage balance. Bank statements carry the file.
- The recent seller. Large brokerage, no current business income. Asset depletion carries the file.
- The owner with both. Healthy deposits and a big portfolio. Run both calculations on the same loan and submit whichever clears debt-to-income with room to spare.
This is where a broker earns their keep. Programs in the network weigh the same file differently. A few will accept a profit-and-loss path. Others want only statements. The strictest overlays want more reserves at the top of the ladder. Comparing them before submission beats finding the problem after.
Key Terms Defined
Expense ratio: the share of business deposits the lender removes to estimate real income.
Divisor: the number of months the lender spreads your eligible assets across to produce monthly income.
Debt-to-income (DTI): your monthly debts divided by your qualifying monthly income.
Reserves: liquid money you must still have after closing, measured in months of the payment.
Super-jumbo: a loan above the size where extra credit and housing-history overlays begin.
The Verdict
Pick bank statements if your money flows through a business and your deposits tell the story. Pick asset depletion if your money sits in a portfolio and your earned income is light. If you are in both camps, model both and submit the stronger one. Neither is a shortcut at $5 million. Each is a different, fully documented way to prove you can carry a very large loan. Tax treatment varies by situation, so consult a qualified professional before relying on any deduction.
Lendmire’s consumer mortgage lending is licensed in 16 states: AL, CA, CO, FL, GA, IN, MI, MT, NM, NC, OH, PA, TN, TX, VA and WA. Availability elsewhere differs.
Frequently Asked Questions
Do I have to sell assets to use an asset depletion loan?
No. The lender divides your eligible assets over a set number of months to create qualifying income. You keep the holdings. The assets are a qualifying convention, though the same balances also count toward your reserves, so they cannot be spent twice.
Can I count my business account balance toward asset depletion?
No. Business funds do not count on the asset path. Business statements can still work on the bank statement path if you own at least 25%. Transfers from your business into your personal account count in full there.
What credit score do I need for either path?
The portfolio program’s floor is 660, and the bank program’s is 680. Above the super-jumbo line, the floor is 700. That is above $3,500,000 on a primary residence and $3,000,000 on a second home or investment property. Higher credit tiers unlock higher leverage on the ladder.
Which path needs more cash in reserve?
Reserves depend on loan size, not on the path: 3 months to $500,000, 6 months to $1,500,000, and 9 months above that. Asset depletion often leans harder on the same liquid funds, so post-closing liquidity matters more there. On super-jumbo files, cash-out proceeds cannot satisfy reserves.
Can I buy a $5 million home in an LLC?
Both methods qualify you personally, so title is typically an individual or a revocable trust. LLC vesting is more common on business-purpose DSCR loans, subject to program terms. Confirm vesting up front, since it can change which programs are available.
Next Step
If you are financing a high-balance property on your assets or deposits rather than traditional personal-income documentation and want to see how the numbers work, Lendmire can help you compare super jumbo options based on your liquid assets, your deposits, the property, your credit profile, leverage, and your goals. Call 828-256-2183 for a conversation. Every program is subject to full underwriting and is not a commitment to lend.
At $5 million, the question is rarely which loan is better in the abstract, but whether your money lives in a business or in a brokerage account.
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 is a non-QM mortgage brokerage (NMLS# 2371349) arranging DSCR investor loans in 41 markets, including Washington, D.C., through wholesale and investor-lending channels. DSCR loans are evaluated by the lender on rental income rather than personal income, subject to lender guidelines — a fit for LLC-owned portfolios, self-employed investors, and operators scaling beyond conventional loan caps. Recognized as a Scotsman Guide Top Mortgage Workplace in 2025 and 2026.
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References
1. Scotsman Guide: Non-QM delinquencies ease on seasonal drivers
2. Scotsman Guide: Which groups are driving non-QM lending
3. Scotsman Guide: The white-hot loans you need to explore
4. Consumer Financial Services Review: CFPB addresses non-QMs under the ability-to-repay rule
5. No. Business
This article is part of Lendmire’s super jumbo bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How a Bank Statement Jumbo Loan Works in Franklin · Bank Statement Loan vs Asset Depletion Loan for High Net Worth Borrowers · Asset Qualifier Mortgage vs Bank Statement Mortgage
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.