The Quick Read: The lender does not choose by preference, because the file’s facts route it, starting with whether the home is a primary residence, second home or rental, then whether your usable assets cover the whole loan on their own or must become monthly income that passes a debt-to-income test. Your balance sheet, your other income and your loan size decide the rest. The program figures are the same for a Pennsylvania borrower as anywhere else, and every file is subject to underwriting.
- The asset qualifier path uses assets alone. Eligible assets, after credit percentages, must equal or exceed the entire loan.
- The asset depletion path turns assets into income. Usable assets divided by 60 months become qualifying income, and that income must carry the housing payment and other debts.
- You are qualified on one path at a time. The two tables of percentages never blend.
- A pure rental purchase usually belongs in a DSCR loan, which qualifies primarily on property-level rental income covering the payment, subject to lender guidelines.
- The figures here are typical ceilings and floors through select programs, not offers.
Key Terms Defined
Asset qualifier path: a way to qualify where eligible assets alone must cover the whole loan amount, and no employment or income is documented.
Asset depletion path: a way to qualify where usable assets are divided by 60 months to create a monthly qualifying income that runs through the debt-to-income test.
Debt-to-income (DTI): your monthly debts, including the new housing payment, compared with your monthly qualifying income.
Haircut: the share of an account’s balance that does not count. A securities account counted at 80% takes a 20% haircut.
Seasoning: how long funds must have sat in your accounts, shown by statements, before they count.
Usable assets: the balance left after the program’s percentages are applied to each account.
DSCR: debt service coverage ratio, meaning whether a rental’s income covers its own monthly obligation. It is the usual tool for investor rentals.
What Are the Two Paths, Side by Side?
The two paths answer different questions. The qualifier asks whether your assets are big enough to cover the loan outright. The depletion path asks whether your assets, converted to income, can carry the monthly obligations.
Labels vary by lender. Some use the two names as if they mean the same thing. Across the wholesale network Lendmire places files with, they are two separate structures, so check what a program tests rather than trusting its name.
| Factor | Asset Qualifier | Asset Depletion |
|---|---|---|
| Core test | Usable assets cover the whole loan | 60-month income passes DTI |
| Income documented | None | Derived from assets |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Purchase leverage | Up to 80% LTV | Up to 80% (primary or second home) |
| Refinance leverage | Up to 75% LTV | Up to 80% rate-and-term; 60% cash-out |
| Credit | 600 minimum score | The lender’s matrix |
| Statements | 60 days seasoning, two months | 120 days old, plus one within 45 days |
Those figures are typical through select programs. On the depletion path, an investment property runs lower: up to 65% on a purchase or rate-and-term refinance, and 60% on a cash-out. The qualifier path covers principal residences and second homes. Whether a qualifier-path cash-out is allowed, and at what leverage, is the lender’s call, and it is not published.
How Does the Lender Actually Pick? Seven Questions in Order
The pick is a sequence of questions. Each answer routes the file, and most files are sorted by the third or fourth question. Here is the order that matters.
1. What is the property for? A primary residence or second home can use either path. An investment property can use only the depletion path, at lower leverage. If the property is a pure rental, the file usually goes to DSCR instead, and the asset question never comes up.
2. What are the assets, and who owns them? The lender lists every account, confirms your name is on it, and applies the percentages for the path in play. Accounts combine on the qualifier path.
3. Do usable assets cover the whole loan? This is the qualifier test. If your counted balances equal or exceed the loan amount, the file can qualify on assets alone with no income documented. The loan must also fit the qualifier ceiling of $4,000,000.
4. If not, can the assets become enough income? If assets fall short of the whole loan, the depletion path takes over. The lender divides usable assets by 60 months and runs the result through the DTI test.
5. Is there other documented income? Social Security, a pension or part-time earnings can sit alongside the depletion income. Asset-derived income may supplement documented income up to a 45% DTI. When it supplements, the minimum-assets rule is waived.
6. Does leverage work? The same borrower gets different maximum leverage depending on path, occupancy and purpose. A cash-out refinance on the depletion path tops out at 60%, whatever the occupancy.
7. Do credit and history clear? The qualifier path has a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix. Housing history of 0x30x12 is the standard, and one 30-day late in the last twelve months is considered case by case.
Two Files, Run Through Their Paths
These are illustrative only, and the lender’s own calculation governs.
Qualifier path example. Say you want an $800,000 loan. You hold $330,000 in brokerage accounts, $300,000 in a 401(k) and $200,000 in savings, and you are under 59½.
- Brokerage counts at 100%, which is $330,000.
- The 401(k) counts at 90% under age 59½, which is $270,000.
- Savings counts at 100%, which is $200,000.
- Usable assets total $800,000, which equals the loan, so the file is reviewed on assets alone, subject to underwriting.
After 59½, that same 401(k) would count at 100%.
Depletion path example. Picture a household living on a portfolio, with $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 total $1,500,000.
- Divided by 60 months, that is $25,000 of monthly qualifying income.
That income then has to carry the housing payment and your other debts through the DTI test. Nothing is sold, and no account is pledged. The 60-month division is a qualifying convention, not a withdrawal plan.
Notice what the two examples show. The same dollar of assets is treated differently on each path. Retirement money is worth more on the qualifier path, at 90% under 59½ and 100% after. It is worth 70% at any age on the depletion path.
Which Path Fits Which File?
Use this as a quick screen before you talk to anyone.
- Large savings, very little income, a loan your assets cover: the qualifier path fits, since you have no income to test.
- Assets that fall short of the whole loan, but plenty to generate income: depletion fits, because the derived income can carry the payment.
- A pension or Social Security plus a sizeable portfolio: depletion fits, because the asset income supplements what you already document, up to a 45% DTI.
- A loan above $3,500,000, up to $4,000,000: only the qualifier path reaches that high.
- A smaller loan, from $125,000 to the depletion ceiling, with a cash-out refinance: depletion, with leverage held to 60% on the depletion path.
- An investment property: the depletion path at lower leverage, or more often DSCR.
The depletion path has two asset floors. You need qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. When assets are the only income source, you also need at least $250,000 in liquid funds. Both floors fall away when asset income only supplements documented income.
What Counts, and What the Lender Will Not Take
On the qualifier path, brokerage accounts, certificates of deposit, money market and savings count at 100%. Retirement balances count at 90% under age 59½ and 100% at 59½ or older.
On the depletion path, the haircuts run like this:
- Cash accounts and certificates of deposit count at 100%.
- Securities count at 80%.
- Private stock counts at 75%.
- Retirement accounts count at 70% at any age.
- Real-estate equity counts at 60%.
Several things do not count on the depletion path: custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options, non-vested restricted stock units and funds from non-regulated financial companies. If deferred compensation is your main asset, Lendmire’s piece How to Use Deferred Compensation in an Asset Depletion Mortgage File walks through the options.
Cryptocurrency, precious metals, collectibles, pledged funds and borrowed funds are not published as eligible on either path. The documented route is to convert them to cash in a regulated account and let the balance season. The lender reviews the source of the funds.
Cash-out proceeds never count as qualifying assets on the depletion path. Money for the down payment, closing costs and any required reserves also comes out of the pool before the lender counts anything.
Where the General Rule Breaks
Both paths verify your assets. Qualifying on assets rather than income does not mean skipping documents. The qualifier path wants two months of statements on every qualifying account and 60 days of seasoning. The depletion path wants statements at least 120 days old plus the most recent one within 45 days. Sale-of-business, inheritance and legal-settlement funds are excused from that seasoning.
More assets do not always win. A large pool can still fail on credit, housing history or property review. A first-time investor on the depletion path needs a 700 score. A housing event such as a foreclosure needs 4 years of seasoning on that path. Multiple bankruptcies are not eligible.
Unusual properties run their own review. A condotel, a rural parcel or a high-rise with a weak association file can stall a loan even when your assets pass. Property-type leverage ceilings can sit below the figures above.
Sub-1.00 rentals. If you are looking at a rental instead, select lenders in the network will review coverage below 1.00, but leverage and terms adjust. That is a DSCR conversation, not an asset one.
Why a Rental Purchase Usually Skips This Fork
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, and they are exempt from the consumer disclosure rules that apply to asset-based mortgages.
Not every property called an investment property is treated as business-purpose. Compliance Alliance notes that the test turns on the loan’s purpose, occupancy and unit count. An owner-occupied purchase of a rental generally needs three or more units to be automatically exempt.
For you, this means a clean split. A DSCR loan asks whether the property covers its own payment. An asset path asks whether your balance sheet carries the payment. An investor scaling a portfolio who starts with an asset program can end up in the wrong underwriting conversation. Asset paths make sense when you are also buying a primary residence or second home. Your complete DSCR loans guide covers the rental side in full.
What Changes on a Pennsylvania File?
Program figures do not change by state. Leverage, haircuts, seasoning and the 60-month divisor read the same for a Pennsylvania borrower as for any other. Lendmire is licensed for consumer mortgage lending in 16 states, and Pennsylvania is one of them.
What does change is the pool left after closing. Closing costs come out of your assets before the lender counts anything, so a purchase with heavier closing costs shrinks usable assets. Row homes, condos and rural properties each draw a different property review, which can lower leverage even when your assets pass. Pennsylvania residents buying in another state, or out-of-state buyers purchasing in Pennsylvania, should confirm availability for that location before building a plan around the numbers.
Because this is a consumer mortgage, the standard consumer loan disclosures apply. Tax treatment varies; consult a qualified professional.
Why the Law Allows Both Paths
Both routes trace to the same federal idea. A creditor may base its repayment-ability decision on income, on assets other than the home, or on both, and it must keep written policies on how it treats each. The Federal Register’s ability-to-repay rule states that the determination may rest on income, assets, or both.
Depletion converts assets into income and then runs the DTI test. The qualifier skips the income math and tests whether the assets cover the loan. Neither removes the lender’s duty to review whether you can repay.
When Neither Path Fits
Sometimes the file just misses. The pool may fall under the depletion floor, or most of the assets may sit in categories that do not count. A few moves help.
- Move uncounted holdings, such as crypto or metals, into a regulated cash account and let them season.
- Lower the loan amount or raise the down payment, which shrinks the pool you need.
- Add documented income, since depletion income can supplement it.
- Consider a bank statement program if you document income with deposits.
- If the property is a rental, move to DSCR.
Frequently Asked Questions
Are asset qualifier and asset depletion the same thing?
Not in the network Lendmire works with, though some lenders use the names loosely. The qualifier path tests whether usable assets cover the whole loan with no income documented. The depletion path divides usable assets by 60 months and runs the income through the DTI test.
Which path produces more qualifying power?
It depends on the file. The qualifier path can reach a $4,000,000 loan, while depletion tops out at $3,500,000. Depletion can work when assets fall short of the loan, because it only needs enough income to carry the payment. Subject to underwriting on either path.
Do I have to sell or pledge my assets?
No. Counting assets does not put a lien on them, and nothing has to be sold. On the depletion path, dividing by 60 months is only a qualifying convention.
Can I combine the asset income with a pension or Social Security?
Yes, on the depletion path. Asset-derived income may supplement documented income up to a 45% DTI, and the minimum-assets rule is waived when it does.
Can I use these paths for a rental property?
Only on the depletion path, at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. A pure rental purchase usually fits DSCR better, because it qualifies primarily on property-level rental income covering the payment, subject to lender guidelines.
Next Step
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. Programs change, and every file is underwritten individually. This is not a commitment to lend.
Pennsylvania rewards the borrower who counts closing costs before counting assets, since the pool that survives closing is the one the lender actually sizes.
Lendmire’s asset-based mortgage in Pennsylvania page presents the program for Pennsylvania borrowers.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage brokerage serving self-employed and high-net-worth borrowers in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages are arranged through wholesale lending channels; Lendmire brokers the financing and the lender underwrites each application. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Compliance Alliance – Regulation Z and Investment Properties
2. CFPB – Regulation Z § 1026.43
3. Federal Register – Ability-to-Repay and Qualified Mortgage Standards
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Does an Asset Depletion Loan Require Any Income? · How to Qualify for an Asset Qualifier Jumbo Loan · How Big Can an Asset Qualifier Mortgage Be?
Guides: Asset-Based Mortgage in Pennsylvania
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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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.