The Quick Read: Usually not: when eligible assets alone qualify you, or when assets are converted into qualifying income, the lender typically does not ask for personal or business income documentation to document earnings, but it still verifies your statements, credit, the property, and the source of your funds, and any other income you add brings its own paperwork back. Michigan has no special rule that changes this. The program figures are the same in every state where Lendmire’s consumer platform operates.
- Assets only: on the asset qualifier path, eligible balances must cover the entire loan, and no employment or income is documented.
- Assets as income: on the asset depletion path, usable assets are divided by 60 months into a qualifying income that runs through the debt-to-income test.
- Still documented: statements, credit, ownership of funds, the appraisal, and title all stay in the file.
- Blended income: if you add wages, business income, or a pension, that income is documented under the program’s own rules.
- Rentals: a pure investment-property purchase often fits DSCR financing better than either asset path.
Subject to underwriting and select lender programs, this is how the pieces fit together.
What Does “Asset-Based Mortgage” Mean Here?
An asset-based mortgage is reviewed around what you own instead of what you earn. In the wholesale network Lendmire places files with, that term covers two different paths. Borrowers qualify on one path at a time, never both.
The asset qualifier path. Your eligible assets, after the credit percentages below, must equal or exceed the entire loan amount. Nothing gets divided into income. The lender’s ability-to-repay review rests on the assets themselves, so no employment or income is documented.
The asset depletion path. Your eligible assets, after haircuts, are divided by 60 months. The result is a monthly qualifying income that must carry the full housing payment and your other debts through the debt-to-income test.
Think of it this way. The first path says the money already covers the loan. The second says the money behaves like a paycheck on paper. Neither path requires you to sell anything, and the depletion math is a qualifying formula, not a withdrawal schedule.
Both are consumer mortgages, aimed at retirees, people who sold a business, heirs, settlement recipients, early-retired professionals, and households living off a portfolio. Their balances are large, and their documented income is small or irregular.
When Are Tax Returns Required, and When Aren’t They?
Traditional personal-income documentation is generally not required on either asset path when assets are your only qualifying source. They come back when you add other income, and a lender can still ask for them in an unusual file. The table shows how that plays out.
| Scenario | Returns needed? | What replaces them |
|---|---|---|
| Qualifier path, assets cover the loan | Typically no | Two months of statements per account |
| Depletion path, assets are the only income | Typically no | Statements plus the 60-month conversion |
| Depletion path, assets supplement wages | Depends | Documented income per program rules |
| Depletion path, self-employed add-on income | Likely yes or an alternative | Program’s own income documentation |
| Unusual or conflicting file | Possibly | Lender’s discretion |
The honest word is “generally,” not “never.” Across the programs Lendmire sees, the flat-out promises of “none required” come from marketing pages. The accurate answer depends on the path and on whether you mix in other income.
Here’s the catch with blending. On the depletion path, asset-derived income may supplement documented income, up to a 45% debt-to-income ratio. When it supplements, the minimum-assets rule is waived. That is useful for someone with modest wages and a large portfolio. But the wages now need proof, and proof for self-employed income usually means returns or an approved alternative.
Does having returns on file force you to use them? Not on the qualifier path, where nothing about income is documented. Choosing the asset route means the returns are not the qualifying basis. A lender can still look at the whole picture, so an unusual file may draw a request.
What the Lender Still Verifies
No traditional personal-income documentation does not mean no paperwork. The assets are documented on both paths, and the file is underwritten individually. A typical asset-based file contains the following.
| Document | Why it is there | Common sticking point |
|---|---|---|
| Account statements | Proves balances exist | Wrong number of months |
| Ownership proof | Funds must be yours | Joint or trust titling |
| Credit report | Score and housing history | Recent late payments |
| Appraisal and title | Values and clears the property | Lake or rural comps |
| Source of large deposits | Confirms funds are not borrowed | Unexplained transfers |
| ID and purchase contract | Identity and the deal itself | Missing addenda |
Statement timing differs by path. On the qualifier path, expect 60 days of seasoning and two months of statements for each qualifying account. On the depletion path, statements must be at least 120 days old at application, plus the most recent statement within 45 days. Funds from the sale of a business, an inheritance, or a legal settlement are excused from that depletion-path seasoning.
Credit still matters. The qualifier path publishes a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix, and a first-time investor on that path needs 700. Housing history is typically 0x30x12, though one 30-day late in the last twelve months may be considered case by case. Multiple bankruptcies are not eligible, and a housing event needs four years of seasoning on the depletion path. None of this is a promise of approval.
How Much of Each Asset Counts?
Not every dollar counts equally, and the tables differ depending on the path. Mixing them is a common mistake borrowers make.
Asset qualifier path (share of the balance that counts):
- Brokerage accounts, CDs, money market, and savings: 100%.
- 401(k) and IRA balances: 90% under age 59½, 100% at 59½ or older.
- Accounts combine.
Asset depletion path (share of the balance that counts):
- Cash accounts and CDs: 100%.
- Securities: 80%.
- Private stock: 75%.
- Retirement accounts: 70% at any age.
- Real-estate equity: 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. Cryptocurrency, precious metals, collectibles, and pledged or borrowed funds 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 lender reviewing the source. Cash-out proceeds from the new loan never count as qualifying assets.
Worked Example: A Retired Michigan Business Owner
Picture a borrower who sold a manufacturing company and wants a second home on an inland lake. This is an illustration, and the lender’s own calculation governs.
On the qualifier path: the loan is $800,000. The borrower holds $330,000 in brokerage accounts (100% counts, so $330,000), $300,000 in a 401(k) while under 59½ (90% counts, so $270,000), and $200,000 in savings (100%, so $200,000). Usable assets total $800,000, which matches the loan. The file is reviewed on assets alone, with no employment or income documented. On a second-home purchase, leverage runs up to 80% loan-to-value, and no reserves are required at or below 75%. Above 75%, the lender sets reserves.
On the depletion path: the borrower holds $1,500,000 in securities (80% counts, so $1,200,000) plus $300,000 in cash (100%, so $300,000). That is $1,500,000 of usable assets, divided by 60 months, for $25,000 of monthly qualifying income. That income then carries the housing payment and other debts through the debt-to-income test.
Same borrower, different tool. The qualifier path suits someone whose balances comfortably exceed the loan. The depletion path suits someone whose balances are large but whose loan is also large, so a straight cover isn’t possible. The depletion path also carries a minimum: qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance, and never below $250,000 liquid when depletion is the only income source.
What About Leverage and Loan Size?
Leverage differs by path and by property use, so each figure needs its label.
- Qualifier path, purchase: up to 80% loan-to-value on a principal residence or second home.
- Qualifier path, refinance: up to 75% on a principal residence or second home. Cash-out terms on this path are set by the lender and are not published.
- Depletion path, principal residence or second home: up to 80% on a purchase or rate-and-term refinance, and 60% on a cash-out refinance.
- Depletion path, investment property: up to 65% on a purchase or rate-and-term refinance, and 60% on a cash-out refinance.
Loan amounts run up to $4,000,000 on the qualifier path and from $125,000 to $3,500,000 on the depletion path. These are ceilings and floors, never offers, and all of it is subject to underwriting and select lender programs. Because these are consumer mortgages, standard consumer disclosures apply.
Rental Property? The Law and the Loan Both Change
Investment-property buyers have a third path, and it is the one that truly leaves traditional income documentation out of the picture for a different reason.
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. Qualification runs primarily on property-level rental income covering the payment, subject to lender guidelines. Lendmire’s complete DSCR loans guide covers how that works in detail.
The federal rule behind this is Regulation Z, which excludes credit extended primarily for a business or commercial purpose. The CFPB’s text of 12 CFR 1026.3 sets out the exemption. Purpose, not paperwork, decides coverage. The ABA Banking Journal notes that a consumer-purpose loan to an individual stays covered even if an LLC guarantees it. A loan used for your own home does not become a business loan by relabeling it.
That is why an asset-based loan on a house you will live in follows consumer rules, while a DSCR loan on a rental does not. The asset depletion path does allow investment property, at the lower leverage shown above. For a pure rental purchase, though, most investors find DSCR is the better fit. It avoids the heavy asset minimums and the 60-month conversion entirely.
Which No-Returns Route Fits Which Borrower?
| Your profile | Likely fit | Choose this if |
|---|---|---|
| Large balances, little income, primary or second home | Asset qualifier | Assets cover the whole loan |
| Large balances, loan too big for a straight cover | Asset depletion | You want assets converted to income |
| Self-employed with strong deposits | Bank statement program | You document income with deposits |
| Buying a rental | DSCR | Rent covers the payment |
| Steady traditional employment income, simple file | Conventional | Returns are clean and cost matters |
The flip point is simple. If your income is real and well documented, a conventional file may cost less and ask for nothing exotic. Asset-based loans earn their place when income is thin, lumpy, or intentionally kept out of the file. For a closer look at the self-employed side, see Lendmire’s piece How Many Years of Tax Returns Does a Self-Employed Mortgage Need?. A seller in the middle of a liquidity event may also want Lendmire’s article Can Tech Founders Get a Mortgage After an Exit Without Tax Returns?.
Edge Cases Worth Planning For
Late or unfiled returns. If your income isn’t the qualifying basis, an unfiled return is not automatically a barrier on the qualifier path. Expect a lender to ask about it if anything in the file points that way.
A recent business sale. The proceeds sit in an account, so they are an asset. Sale-of-business funds are excused from depletion-path seasoning, though the lender still reviews where they came from.
Inheritance or settlement money. The same seasoning relief applies on the depletion path. Trust titling can complicate the ownership proof, so sort that out before applying.
Large one-time deposits. Unexplained deposits slow a file down more than anything else. Keep a paper trail for every transfer in the statement window.
Retirement accounts. The age line matters on the qualifier path: 90% under 59½, 100% after. On the depletion path, retirement accounts count at 70% at any age.
Tax treatment varies; consult a qualified professional.
Michigan Considerations
Michigan changes the scenery, not the rules. Lendmire’s consumer mortgage platform is licensed in 16 states, Michigan among them, and the program parameters above do not move by state. No Michigan-specific rule changes the tax-return answer.
The borrower profiles are local, though. Retirees who split time between a primary home and a place Up North are natural candidates for a second-home purchase on the qualifier path. Owners selling a closely held business often hold large, fresh cash balances and thin recent income. Lakefront and seasonal properties can bring appraisal complexity, so comps matter. Treat any state-level cost as context only, since none of it alters program eligibility.
Myths vs. Facts
Myth: no conventional personal-income paperwork means no documentation. Fact: assets are documented on both paths. Statements, ownership, credit, the appraisal, and title all stay.
Myth: asset depletion means selling your portfolio. Fact: the assets are converted into notional income for qualifying. You keep them.
Myth: non-QM means weak credit. Fact: both paths have credit requirements, and a first-time investor on the depletion path needs 700.
Myth: cryptocurrency counts like a brokerage account. Fact: it is not published as eligible. Convert it to seasoned cash first.
Myth: Michigan has its own rule. Fact: nothing in the program changes by state.
Key Terms Defined
Asset qualifier path: a program in which eligible assets, after credit percentages, must cover the entire loan amount.
Asset depletion path: a program that divides usable assets by 60 months to create monthly qualifying income.
Seasoning: the length of time funds must have been in your account before they count.
Debt-to-income ratio: your monthly debts, including the new housing payment, divided by your qualifying monthly income.
Haircut: the percentage of an asset’s balance that does not count toward qualifying.
DSCR: a business-purpose rental loan measure, comparing a property’s rent to its monthly obligation.
Frequently Asked Questions
Can I qualify if I have large savings but haven’t filed returns recently?
Possibly, on the qualifier path, since no income is documented there. The lender still reviews credit and the source of your funds, and a file with open questions may draw additional requests. Subject to underwriting and select programs.
Does blending wages with assets bring standard personal-income documentation back?
Usually the added income must be documented under program rules. For W-2 earners that is often pay stubs and a verification, while self-employed income typically needs returns or an approved alternative. On the depletion path, assets may supplement documented income up to a 45% debt-to-income ratio.
Do I have to sell investments to qualify?
No. On the depletion path, assets are divided by 60 months into qualifying income on paper only. Nothing is liquidated.
Can I use an asset-based mortgage on a rental?
Yes, on the depletion path, at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out refinance, subject to underwriting. Most pure-rental buyers compare it with DSCR financing, which is reviewed on the property’s rental income instead of your balances.
Is an asset-based mortgage the same as a bank statement loan?
No. A bank statement program is for borrowers who document income through deposits. An asset-based mortgage is reviewed around balances, not deposit history.
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, every file is underwritten individually. This is not a commitment to lend. Large balances and a thin paycheck are exactly the profile these loans were built for.
Lendmire’s asset-based mortgage in Michigan page presents the program for Michigan borrowers.
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.
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. CFPB – 12 CFR 1026.3 Exempt transactions
2. ABA Banking Journal – Compliance Q&A on individual borrowers with LLC guarantors
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 a Securities-Backed Line of Credit Hurt Your Asset-Based Mortgage Application? · How a Margin Balance Is Treated on an Asset Depletion Mortgage · Is an Asset-Based Mortgage Reported to Credit Bureaus Like Any Other Mortgage?
Guides: Asset-Based Mortgage in Michigan
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
Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.