The Quick Read: The lender reviews your file on the balances in your own accounts instead of your paycheck, pays off your current mortgage with a new one, and does not hand you cash back. On this path, your eligible assets, after the percentage credit each account type receives, must equal or exceed the entire new loan, subject to underwriting.
- Rate-and-term means you replace the existing loan with a new one and take no meaningful cash out.
- On the asset qualifier path, leverage tops out at 75% loan-to-value on a refinance of a principal residence or second home, with loans up to $4,000,000.
- Brokerage, CD, money market and savings balances count at 100%. A 401(k) or IRA counts at 90% under age 59½ and 100% after.
- You still document the assets: 60 days of seasoning and two months of statements for each account.
- A separate path, asset depletion, turns assets into monthly income instead. You qualify on one path at a time.
Key Terms Defined
Rate-and-term refinance: a new loan that pays off the old one and covers closing costs, with no meaningful cash back to you.
Asset qualifier: a program that approves the loan based on eligible assets that equal or exceed the whole loan amount, with no employment or income documented.
Asset depletion: a program that divides usable assets by 60 months to create a monthly qualifying income, which then runs through a debt-to-income test.
Debt-to-income (DTI): 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.
Haircut: the share of an account’s balance that a lender will not count, because the balance can swing in value or carries penalties.
Loan-to-value (LTV): the loan amount as a percentage of the home’s appraised value.
Non-QM: a mortgage that falls outside the standard federal agency box, which is why programs like this one can set their own rules. Scotsman Guide describes asset-based loans as non-QM products that government-backed buyers do not purchase.
Which Path Fits You?
Pick the asset qualifier path if your balances are large enough to cover the whole new loan outright. Pick asset depletion if you would rather turn the same balances into monthly income and run a normal debt-to-income test.
The typical borrower is cash-heavy and income-light. Think of a retiree living on a portfolio, someone who just sold a business, an inheritance recipient, or an early-retired professional. Their balances are large, but their documented income is thin or irregular.
A borrower is qualified on one path at a time. The two tables never blend. A figure from one path says nothing about the other, so every number below names its path.
How the Asset Qualifier Rate-and-Term Refinance Works Step by Step
The process runs in a fixed order, and each step decides whether the next one matters. Across the wholesale network Lendmire places files through, the sequence looks the same from program to program, even though the details differ.
1. Occupancy and purpose. The home must be your principal residence (or a second home on this path). The new loan pays off the existing mortgage and closing costs. No meaningful cash comes back to you.
2. Asset gathering. You provide statements for every account you want counted. On the qualifier path that means two months of statements per account and 60 days of seasoning.
3. Credit percentages. Each account type counts at a set share of its balance. Brokerage, CDs, money market and savings count at 100%. Retirement accounts count at 90% under 59½ and 100% at 59½ or older. Accounts combine.
4. The coverage test. The total of those credited balances must equal or exceed the entire loan amount. This is the heart of the program.
5. Credit and property review. The qualifier path sets a 600 minimum score. The lender also reviews housing payment history, and one 30-day late in the last twelve months is considered case by case. A full appraisal confirms the value supports the leverage.
6. Payoff and new loan. Title work confirms the lien being paid off. The old payment disappears and the new loan takes its place.
7. Underwriting decision. The lender documents its finding that you can repay, resting on the verified assets.
One feature simplifies this for many borrowers. On the qualifier path, programs generally require no reserve months at or below 75% LTV. A rate-and-term refinance tops out at exactly that ceiling, so the reserve question usually does not arise. Above 75%, the lender sets reserves. All of this is subject to underwriting.
What Counts, and How Much
The two paths credit assets differently, so the same portfolio can produce different totals. Here is the side-by-side view for a principal residence.
| Factor | Asset qualifier | Asset depletion |
|---|---|---|
| What assets do | Cover the whole loan | Become monthly income |
| Rate-and-term leverage | Up to 75% | Up to 80% |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit | 600 minimum | Lender’s matrix |
| Statements | Two months each, 60-day seasoning | 120 days old plus one within 45 days |
| DTI test | None documented | Yes |
And here is how each account type counts:
| Account type | Qualifier path | Depletion path |
|---|---|---|
| Brokerage or securities | 100% | 80% |
| Cash, savings, CDs | 100% | 100% |
| 401(k) or IRA | 90% under 59½, 100% after | 70% at any age |
| Private stock | Not listed | 75% |
| Real-estate equity | Not listed | 60% |
Some assets do not count on either path. Cryptocurrency, precious metals, collectibles, pledged or borrowed funds, and business accounts beyond your ownership share are not published as eligible. The documented route is to convert them to a seasoned cash balance in a regulated account, with the source reviewed by the lender. The depletion path also excludes custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options and non-vested restricted stock units.
Two Worked Examples
These are illustrations of the arithmetic only. The lender’s own calculation governs, and every file goes through individual underwriting.
Qualifier path. Say you are refinancing an $800,000 loan on your principal residence. You hold $330,000 in brokerage accounts (100%, so $330,000), $300,000 in a 401(k) while under 59½ (90%, so $270,000), and $200,000 in savings (100%, so $200,000). Together that counts $800,000 of usable assets. The assets match the loan, so the file is reviewed on assets alone, without documenting income. The home’s appraised value still has to keep the loan at 75% LTV or lower. The exact numbers vary by lender and program and follow a full review of property, leverage, and credit.
Depletion path. 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. That gives $1,500,000 of usable assets. Divide by 60 months and you get $25,000 of monthly qualifying income. That income then has to carry the housing payment and your other debts through the debt-to-income test.
Notice what separates the two. The first example needs balances that match the loan. The second needs balances that produce enough income. Depletion minimums also apply: qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan, and never below $250,000 liquid when depletion is your only income source.
Where the General Rule Breaks
The basic rule is simple: assets stand in for income. Several edge cases bend it.
Cash-out. Rate-and-term is the cleaner fit. On the depletion path, a cash-out refinance on a principal residence or second home drops to 60% LTV, versus 80% for rate-and-term. Cash-out proceeds never count as qualifying assets. On the qualifier path, whether cash-out is allowed, and at what leverage, is set by the lender and is not published, so no figure is safe to assume. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
Retirement accounts and age. The age 59½ breakpoint matters on the qualifier path. Under it, a 401(k) or IRA counts at 90%. After it, 100%. On the depletion path retirement balances count at 70% at any age.
Committed funds. Money you plan to spend at closing cannot also be counted as qualifying assets. One pool of money cannot do two jobs. Plan for the pool to cover the loan with room to spare.
Marginal credit history. One 30-day late on housing in the last twelve months is considered case by case. Multiple bankruptcies are not eligible. A housing event needs 4 years of seasoning on the depletion path.
Large recent deposits. Money that just arrived in an account has not been seasoned. The qualifier path wants 60 days. The depletion path wants statements at least 120 days old. Sale-of-business, inheritance and legal-settlement funds are excused from that depletion seasoning, though the lender still reviews the source.
Investment property. The qualifier path is for principal residences and second homes. Only the depletion path reaches investment property, at lower leverage: up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out.
Why This Is Still Real Underwriting
Qualifying on assets does not mean skipping verification. A principal residence is a consumer loan, so the federal ability-to-repay rule in Regulation Z applies. It requires the lender to consider income or assets, along with debts and a debt-to-income or residual-income measure, and to verify what it relies on. Standard consumer mortgage disclosures also apply.
A law-firm analysis at CFS Review explains that the lender needs to consider and verify only the income or assets it actually relies on. That is the legal footing for assets-only decisions. It is also why you hand over statements even though you hand over no pay stubs.
Is It Worth Doing? A Decision Checklist
Run through these before you apply.
- Your income documents look weak but your balances are strong. This is the fit. Heavy write-offs, retirement or a recent business sale make income documents misleading, while your balances tell the true story.
- You can keep the assets in place. The program tests what you hold. Draining the accounts after approval defeats the point. It also cuts the cash you have for the next purchase.
- The new loan beats the old one by enough to cover closing costs. Work out your break-even with the lender’s actual figures. Never assume it.
- Portfolio values can move. Stock-heavy balances can shrink between application and closing, and the haircuts are applied to the balance on your statements. A cash-heavy pool gives you more cushion.
- You are not hoping to take cash out. If you need cash back, ask about the depletion path’s 60% cash-out limit, or consider a different product. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
This is a trade-off, not a free lunch. Qualifying this way keeps your income documents out of the file, yet it asks for bigger, better-documented balances.
Asset Qualifier Versus the Alternatives
Different borrowers need different tools. Here is how the common options line up. Exact terms depend on lender and investor guidelines, credit profile, reserves, and property review.
| Option | Best fit |
|---|---|
| Asset qualifier | Balances cover the whole loan |
| Asset depletion | Balances can generate enough income |
| Bank statement loan | Self-employed with strong deposits |
| DSCR loan | Rental property, not your own home |
| Full-doc conventional or jumbo | W-2 or tax-return income is strong |
Each of these follows its own rules. The bank statement program is for borrowers who document income through deposits. A full-documentation loan relies on traditional personal-income documentation and pay records.
DSCR is the rental route. 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, so your personal income is not the test. The complete DSCR loans guide walks through that side. If your rental refinance is next, Lendmire’s explanation of reserves on a DSCR rate-and-term rental refinance covers what lenders look for.
Many asset-rich borrowers use both tools: asset-based financing on the home they live in, and DSCR on the rentals.
Frequently Asked Questions
Can I refinance without documenting income?
Yes, on the qualifier path, you document assets instead of employment or income. You still provide statements, a credit review and an appraisal, and the lender underwrites each file individually. Approval is never assured.
Do I have to sell or pledge my investments?
No. The balances are a qualifying measure. Nothing is sold or pledged to the lender, though the accounts must stay in place and keep their balances. Tax treatment varies; consult a qualified professional.
Can I take cash out on this program?
On the asset depletion path, cash-out on a principal residence or second home is available up to 60% LTV, and the proceeds never count as qualifying assets. On the qualifier path, the lender sets cash-out terms and does not publish them. A rate-and-term refinance avoids the question. Leverage, reserves, and pricing vary by lender and program; the final terms follow the full file review.
Does a retirement account count?
Yes. On the qualifier path, a 401(k) or IRA counts at 90% under age 59½ and 100% at 59½ or older. On the depletion path it counts at 70% at any age. These percentages apply to balances, subject to underwriting.
What if my current mortgage is with another lender?
It does not matter. A rate-and-term refinance pays off the existing lien wherever it sits. Title work confirms the payoff, and your old payment is replaced by the new one.
Next Steps
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. Lendmire is a broker that places these loans through select lenders in its network, and consumer mortgage lending is licensed in 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington. Every figure above is a ceiling or floor from select programs, not an offer, and programs change.
About Lendmire
Lendmire is a mortgage brokerage (NMLS# 2371349) licensed for consumer mortgage lending in 16 states, arranging bank statement and other alternative-documentation mortgages — P&L-only, 1099-only and asset-based paths — through a wholesale lending network. Eligibility is determined by the lender on each file. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
Get Started
Ready to find the right loan for you?
In about 30 seconds you can review financing options available for your home or investment property. No commitment required.
Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. Scotsman Guide: Net Worth Can Matter More Than a Pay Stub
2. CFPB Regulation Z § 1026.43
3. CFS Review: CFPB Addresses Non-QMs Under ATR
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? · Asset Qualifier vs Asset Depletion for a Cash-Out Refinance · How to Qualify for an Asset Qualifier Mortgage
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
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.