The Quick Read: Usually 60 months across the wholesale network Lendmire places files with: select lenders take your usable assets after the haircuts, divide by 60, and treat the result as monthly qualifying income, subject to underwriting. Lenders in the wider market use shorter or longer periods, so the divisor always belongs to the program, not the industry.
- The 60-month divisor applies only on the asset depletion path, where assets become income that runs through the debt-to-income test.
- The asset qualifier path has no divisor. Eligible assets must cover the entire loan amount instead.
- Haircuts come first.
- Cash-out proceeds never count as qualifying assets.
- A borrower is reviewed on one path at a time, never a blend of both.
Two Paths, and Only One Uses a Divisor
An asset-based mortgage can work two ways, and the divisor only matters on one of them. Mixing them up is a common source of confusion.
On the asset qualifier path, the lender adds up your eligible assets after the credit percentages. If that total equals or exceeds the whole loan amount, you qualify on assets alone. No employment or income is documented. There is no division and no debt-to-income calculation.
On the asset depletion path, the lender converts your assets into an imputed monthly income. “Imputed” means calculated, not received. That income must carry the full housing payment and your other debts through the debt-to-income test. This is where the 60 months comes in.
Both paths document the assets. Statements are reviewed and verified. “No income documentation” never means “no documentation.”
The Formula, Step by Step
The math is simple. The details that come before the division decide the result.
1. Total your eligible assets. Each asset type counts at a set percentage of its balance. That discount is the haircut.
2. Take out what the deal consumes. Down payment, closing costs, and any required reserves leave the pool before any income is calculated. A bigger down payment means lower qualifying income.
3. Divide by 60 months. The result is your monthly qualifying income.
4. Run it through the debt-to-income test. The imputed income must carry the housing payment and your other monthly debts.
5. Stack other income if you have it. Asset-derived income can supplement documented income up to a 45% debt-to-income ratio. When it supplements, the minimum-assets rule is waived.
Here is the sanctioned illustration. Say you hold $1,500,000 in securities and $300,000 in cash. Securities count at 80%, which is $1,200,000. Cash counts at 100%, which is $300,000. Usable assets come to $1,500,000. Divided by 60 months, that is $25,000 of monthly qualifying income.
That figure then has to carry your housing payment and other debts. The lender’s own calculation governs, and the illustration is not an offer.
The relationship is linear. Shrink the pool by 20% and your income falls by 20%, because the divisor does not move.
What Counts, and at What Percentage
The percentages differ by path. Never read one column as if it were the other.
| Asset | Depletion path | Qualifier path |
|---|---|---|
| Cash and savings | 100% | 100% |
| Certificates of deposit | 100% | 100% |
| Money market | Not listed separately | 100% |
| Brokerage and securities | 80% | 100% |
| Private stock | 75% | Not listed |
| Retirement accounts | 70% at any age | 90% under 59½, 100% at 59½+ |
| Real-estate equity | 60% | Not listed |
Several things never count on the depletion path. These include custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options, and non-vested restricted stock units. Cryptocurrency, precious metals, and collectibles are not published as eligible on either path. The documented route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
For a deeper look at how each account type is treated, see Lendmire’s piece How Lenders Count Assets Toward an Asset Depletion Mortgage.
If most of your wealth sits in retirement accounts, age changes the picture on the qualifier path.
Why the Divisor Isn’t One National Number
No rule fixes the divisor for every lender. Each program chooses it, and the choice is a risk decision. A shorter period produces more income from the same balance, so the lender takes more risk on the borrower’s ability to keep paying. A longer period produces less income and demands more assets per dollar of loan.
Across the market, programs differ. Explainers on the topic show some non-agency programs using 84 months and others 60, so market comparisons show a spread, not a standard. On the programs Lendmire places files with, the depletion path uses 60 months.
The spread matters because the same pool produces very different income. Move from 60 months to 84 and income drops by roughly 30%. Move from 60 to 360 and income drops to one-sixth, which means the 60-month divisor produces about six times more income.
The practical rule: quote the program’s own divisor, not a market average. If a lender will not tell you the number, you cannot compare offers.
How agency conventional loans differ
Agency conventional loans work differently. They are not the same as this program, and they rarely suit an investor. Fannie Mae’s employment-related assets guideline limits this income method to purchases and limited cash-out refinances on a principal residence or second home. Investment property is excluded.
Its divisor is the loan’s amortization term in months. A Truist seller guide example divides $350,000 by 360 for a 30-year loan to reach a monthly income figure. Freddie Mac’s servicing guide divides “net eligible assets” by 240 after subtracting down payment, closing costs, gift and borrowed funds, and pledged assets.
Those are agency rules, not this program’s. Do not carry a 360 or 240 into a non-agency file. Agency terms also change, so check the current guide before relying on them.
Does the Divisor Change With Loan Term?
The divisor stays 60 months whether your loan amortizes over 15 years or 30. Only the agency method ties the divisor to the loan term. That is why a borrower comparing agency and non-agency math can see dramatically different income from the same balance.
What Else Limits You on the Depletion Path
The divisor is only one gate. These floors and ceilings apply subject to underwriting and select-program guidelines.
- Loan size: $125,000 to $3,500,000 on the depletion path.
- Minimum assets: qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. When assets are your only income source, never below $250,000 in liquid assets.
- Leverage on a principal residence or second home: up to 80% on a purchase or rate-and-term refinance, and 60% on a cash-out refinance.
- Leverage on an investment property: up to 65% on a purchase or rate-and-term refinance, and 60% on a cash-out refinance.
- Credit: the lender’s score and loan-amount matrix. A first-time investor on this path needs a 700 score.
- Seasoning: statements at least 120 days old at application, plus the most recent statement within 45 days. Sale-of-business, inheritance, and legal-settlement funds are excused from that seasoning.
- Housing history: 0x30x12, with one 30-day late in the last twelve months considered case by case. A housing event needs four years of seasoning.
The qualifier path has its own numbers. It allows up to 80% on a purchase and 75% on a refinance, on a principal residence or second home, with loans up to $4,000,000. The score floor is 600. It requires 60 days of seasoning and two months of statements per qualifying account.
Reserves also differ. The qualifier path requires none at or below 75% loan-to-value. The depletion path has no published reserve months. Lendmire’s piece How Many Months of Reserves Does an Asset Depletion Jumbo Loan Require? covers how larger files behave.
The Investor Decision: Assets or Rent?
Asset depletion is a personal-income method. DSCR is a property-income method. 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.
DSCR qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Your complete DSCR loans guide explains how that works. Sub-1.00 coverage is available through select lenders in the network, though leverage and terms adjust.
So which one fits you?
- The rent covers the payment comfortably: DSCR is usually the cleaner path for a rental. It does not lean on your assets or personal income.
- The rent is thin, but you hold large balances: asset depletion can carry a property that DSCR would not. Expect the lower investment-property leverage listed above.
- You want to buy a home to live in, with large cash and little income: the asset qualifier path may cover the loan outright, with no divisor at all.
The asset-based mortgage is a consumer loan for people whose balances are large and whose documented income is not. That often means retirees, business sellers, inheritance or settlement recipients, and early-retired professionals. It is not the business-purpose rental product.
Say your pool is large and your taxable income is low. If your target property rents poorly against its payment, a depletion-path file may be the stronger structure. If the property cash flows, DSCR usually asks less of you.
Common Mistakes
- Dividing the statement balance. The pool is after haircuts and after down payment, closing costs, and reserves.
- Using the wrong path’s percentages. A brokerage account counts at 100% on the qualifier path and 80% on the depletion path.
- Assuming a market divisor. Your income depends on the program’s number, so ask for it.
- Counting home equity from the property you are buying. The dwelling securing the loan is excluded.
- Thinking assets get sold. Nothing is liquidated or pledged. The funds stay in your accounts.
- Counting cash-out proceeds. They never qualify as assets.
Questions to Ask a Lender About the Divisor
- What divisor does this program use, and does it change with loan size or with how much documented income I have?
- Which of my assets count, and at what percentage?
- What comes out of the pool before the division?
- What debt-to-income ceiling applies to the imputed income?
- How old must my statements be?
Key Terms Defined
Divisor: the number of months your usable assets are divided by to produce monthly qualifying income.
Haircut: the discount applied to an asset type, so only part of its balance counts.
Imputed income: income the lender calculates from your assets. You do not actually receive it.
Debt-to-income ratio: your monthly debts, including the new housing payment, compared with your monthly income.
Seasoning: how long funds have sat in your account before the lender will count them.
Frequently Asked Questions
Is my money actually withdrawn or sold?
No. The lender verifies your statements, and the assets stay in your accounts. The term depletion describes the math, not a withdrawal schedule. Assets are documented on both paths.
Can I combine asset income with a paycheck or business income?
Yes, on the depletion path. Subject to underwriting.
Why do two lenders give different qualifying income on the same balance?
They use different divisors, different haircuts, and different rules about what comes out first. A shorter divisor, such as 60 months instead of 84, yields noticeably more monthly income from the same pool, and a longer one yields less. That is why comparing numbers across programs matters.
Does a bigger down payment hurt my qualifying income?
On the depletion path, yes. Down payment, closing costs, and required reserves leave the pool before the division, so a larger down payment shrinks the income the pool produces.
Can I use this for a rental property?
Yes, on the depletion path, at lower leverage than a primary residence: up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out, through select programs. DSCR is the usual rental path when the property’s income covers its payment. Short-term rental rules can vary by city, county, HOA, and property type, so confirm local rules before relying on projected rental income.
If you are qualifying on assets rather than income and want to see how the numbers work, Lendmire can help you compare asset-based mortgage options based on your statements, the property, credit profile, leverage, and your goals. Consumer mortgage lending is licensed in 16 states, so availability depends on where the property sits. Qualification is subject to lender guidelines, and none of this is a commitment to lend.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. StatementsReady asset depletion explainer
2. Fannie Mae Selling Guide B3-3.4-06, Employment-Related Assets as Qualifying Income
3. Truist Seller Guide agency revisions
4. Freddie Mac Guide Section 5307.1
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can You Do a Cash-Out Refinance on an Asset Depletion Loan? · How to Document an Asset Depletion Loan When Assets Are Liquid Holdings · How to Qualify for an Asset Depletion Jumbo Loan
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.