The Quick Read: No, an asset-based mortgage does not require traditional personal-income documentation as the qualifying document, because the loan is reviewed on your documented assets instead of your documented income, subject to underwriting. The assets themselves are fully documented. Lenders review statements, seasoning and credit instead of a Schedule C or a W-2.
- Asset qualifier path: eligible assets must cover the entire loan. No employment or income is documented.
- Asset depletion path: eligible assets are divided by 60 months to create qualifying income, which then runs through a debt-to-income test.
- Leverage: up to 80% on a purchase and 75% on a refinance on the qualifier path, for a principal residence or second home.
- Credit: a 600 minimum score on the qualifier path. The depletion path follows the lender’s matrix.
- The exception: if you want documented income to supplement your assets, expect income paperwork for that piece of the file.
What Does “Asset-Based Mortgage” Actually Mean?
An asset-based mortgage is a consumer home loan that is reviewed around what you own rather than what you earn. It is built for borrowers with large balances and thin documented income. That includes retirees, people who sold a business, heirs, settlement recipients, early-retired professionals and households living off a portfolio.
The term is used loosely online. It can mean three different things:
- A loan qualified on assets, which is what this article covers.
- A loan secured by a pledged investment account.
- A general alternative-documentation loan.
Across Lendmire’s wholesale network, the asset-based programs fall into two paths. A borrower is qualified on one path at a time. The two never blend.
The asset qualifier path. Your eligible assets, after the credit percentages below, must equal or exceed the entire loan amount. Nothing about employment or income is documented. The lender’s ability-to-repay review rests on the assets.
The asset depletion path. Your usable assets, after haircuts, are divided by 60 months. The result is a monthly qualifying income. That income must carry the full housing payment and your other debts through the debt-to-income test.
Virginia borrowers use the same program figures as borrowers anywhere else. Lendmire is a broker. It arranges these loans through select lenders in its network and is licensed for consumer mortgage lending in 16 states, Virginia among them. Qualification is always subject to underwriting.
Why Tax Returns Aren’t the Qualifying Document
Traditional personal-income documentation exists to prove income. If the loan is reviewed on assets, income is not the thing being proven. A lender looking at a seven-figure brokerage balance has no need for a retiree’s near-empty Schedule 1.
On the qualifier path, the lender asks one question: do the eligible assets cover the loan? The answer comes from account statements. Your tax filing history does not enter into it.
On the depletion path, the lender builds an income figure from your balances. It does not read one off a return. The derived income then goes through the debt-to-income test. Again, the input is statements.
This is a practical difference investors and retirees notice right away. A borrower with heavy depreciation, a business sale or years of low reported income can look weak on paper while holding plenty of cash. The asset path measures the cash.
Don’t confuse this with skipping documentation. The assets are documented on both paths. “No income documentation” never means “no documentation.”
What Replaces Tax Returns in the File
The file shifts from income paperwork to asset paperwork. Here is what a lender in the network typically looks for, subject to underwriting.
| Document | What it proves | Typical status |
|---|---|---|
| Account statements | Balances and ownership | Required |
| Source of large deposits | Funds are yours and seasoned | Reviewed case by case |
| ID and credit authorization | Who you are, your credit profile | Required |
| Purchase contract or refinance details | The transaction | Required |
| Traditional personal-income documentation | Reported income | Typically not required |
| Pay stubs and W-2s | Employment income | Not used on the qualifier path |
Statement rules differ by path. Both are subject to underwriting.
- Qualifier path: 60 days of seasoning and two months of statements for each qualifying account.
- Depletion path: statements 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 seasoning.
Seasoning is where most of these files get slowed. A large transfer into a savings account last month is exactly what an underwriter will ask about. Keep deposits documented and leave money where it sits.
Which Assets Count, and How Much of Each
Assets do not all count at face value. The percentage depends on the path.
Asset qualifier path. Share of the balance that counts:
| Asset | Counts at |
|---|---|
| Brokerage accounts | 100% |
| Certificates of deposit | 100% |
| Money market | 100% |
| Savings | 100% |
| 401(k) and IRA, under age 59½ | 90% |
| 401(k) and IRA, age 59½ or older | 100% |
Accounts combine. An illustrative file: an $800,000 loan, with $330,000 in brokerage accounts (100% is $330,000), $300,000 in a 401(k) at an owner under 59½ (90% is $270,000) and $200,000 in savings (100% is $200,000). That counts $800,000 of usable assets, so the file is reviewed on assets alone. The lender’s own calculation governs.
Asset depletion path. Share of the balance that counts:
| Asset | Counts at |
|---|---|
| Cash accounts | 100% |
| Certificates of deposit | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts, any age | 70% |
| Real-estate equity | 60% |
Illustrative: $1,500,000 in securities (80% is $1,200,000) plus $300,000 in cash (100% is $300,000) is $1,500,000 usable. Divided by 60 months, that is $25,000 of monthly qualifying income. That income then carries the housing payment and other debts through the debt-to-income test.
Several asset types are not eligible 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. The lender then reviews the source. Cash-out proceeds never count as qualifying assets.
Leverage, Loan Size and Credit
The figures below are ceilings and floors, not offers. They reflect select programs in the network and sit subject to underwriting.
Asset qualifier path, principal residence or second home:
- Up to 80% loan-to-value on a purchase.
- Up to 75% on a refinance.
- Loans up to $4,000,000.
- A 600 minimum credit score.
- No reserves required at or below 75% loan-to-value. Above that, the lender sets them.
Asset 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.
- Investment property: up to 65% on a purchase or rate-and-term refinance, and 60% on a cash-out refinance.
- Loans from $125,000 to $3,500,000.
- Credit follows the lender’s score and loan-amount matrix. A first-time investor on this path needs 700.
- Qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. Never below $250,000 liquid when asset depletion is the only income source.
Housing history is typically 0x30x12 over the last twelve months. One 30-day late in that window is considered case by case. Multiple bankruptcies are not eligible. On the depletion path, a housing event needs four years of seasoning.
When a Lender Might Still Ask for Tax-Related Paperwork
“No tax returns” is the usual answer. It is not an absolute one. These are the situations where income paperwork can come back into the file.
You want to supplement with documented income. 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. But the documented income piece needs documentation. If you count a pension, a business income stream or rental income, expect the lender to ask for proof of it.
A large deposit needs explaining. If a six-figure transfer landed in an account inside the seasoning window, the underwriter may ask where it came from. A sale agreement or closing statement usually answers that. Occasionally a lender wants something tax-related to trace the money. That is case by case, not a standing requirement.
The lender has its own overlay. Programs differ. Most files in this category run without returns, but a lender’s own overlay is always possible. Ask before you assume.
You are buying a rental as a business. Here the product changes. An asset-based mortgage is a consumer loan, and consumer mortgage disclosure rules apply to it. A rental bought as a business is a different animal. Business-purpose investment loans are treated differently under federal rules. The Federal Register preamble to the federal ability-to-repay rule says business-purpose loans fall outside that rule and that investment-purpose loans are considered business purpose.
That classification is a fact test, not a label you pick. A Doss Law guide to the business-purpose exemption gives an example of a loan that does not qualify: a cash-out refinance of a single-family rental used to pay personal income taxes. If the real purpose is personal, the file gets treated that way.
For a pure rental purchase, most investors end up on a DSCR loan. That loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Lendmire’s complete DSCR loans guide covers how it differs from the asset-based path above. A DSCR loan also leaves traditional income documentation out of the standard file, though it still reviews credit, reserves and the property.
If you are comparing against a borrower who does use returns, such as a self-employed owner, Lendmire’s piece How Many Years of Tax Returns Does a Self-Employed Mortgage Need? shows the other side of this.
How It Compares With Other Alternative Programs
Each program in this group answers the income question differently. Here is the side-by-side.
| Program | What qualifies you | Traditional personal-income documentation |
|---|---|---|
| Asset qualifier | Assets cover the whole loan | Typically not required |
| Asset depletion | Assets divided by 60 months | Typically not required |
| Bank statement | Documented deposits | Replaced by statements |
| DSCR | Property rent vs. its payment | Typically not required |
The bank statement program is for borrowers who document income through deposits. It fits an owner whose business deposits are strong but whose returns are not. DSCR is the business-purpose rental product. The asset paths are for borrowers whose balances are large and whose documented income is not.
Big retail lenders usually default to full income documentation. That is why borrowers with big balances and quiet paychecks get turned away there and end up looking at these programs.
Who Fits, and Who Doesn’t
Fits well:
- A retiree living on a portfolio.
- A person who sold a business and holds the proceeds in cash and securities.
- An heir with a large seasoned balance.
- A household with strong balances and low reported income.
Fits poorly:
- A borrower whose wealth sits mostly in crypto, collectibles or foreign funds. Those do not count as published eligible assets.
- A borrower with a recent bankruptcy or a recent housing event.
- Someone with solid traditional employment income and modest savings. A standard program usually fits them better.
- Anyone who needs the property to cash-flow as a business. That is a DSCR file.
One honest trade-off: the asset depletion path haircuts your balances, so it takes a lot of capital to create meaningful income. A large portfolio of securities at 80% still needs a big base to clear the debt-to-income test. The qualifier path is cleaner when the assets are liquid and cover the loan outright.
How to Prepare a File as a Virginia Borrower
A clean file starts with the asset picture, not the income picture.
1. Pick your path. Do assets cover the loan outright, or do they need to become income? That decides everything that follows.
2. Gather statements for every account you plan to count. Two months for each on the qualifier path. On the depletion path, one statement at least 120 days old and the latest within 45 days.
3. Leave the money where it is. Moving funds between accounts inside the seasoning window creates questions. Sale-of-business, inheritance and settlement funds are excused from seasoning on the depletion path, but keep the paper that shows the source.
4. Convert unlisted assets early. Crypto, metals or collectibles need to become seasoned cash in a regulated account before they help.
5. Check your credit and housing history. The qualifier path’s floor is a 600 score. Know your housing payment history over the last twelve months.
6. Confirm the property type. Principal residence and second home are available on both paths. Investment property is available only on the depletion path, at lower leverage.
Lendmire’s piece Can Tech Founders Get a Mortgage After an Exit Without Tax Returns? walks through a case where the proceeds are fresh.
Tax treatment can depend on how the funds are used and how the property is held; borrowers should keep clear records and speak with a qualified tax professional before relying on any deduction.
Key Terms Defined
Asset qualifier path: The asset-based path where eligible assets must cover the entire loan and no income is documented.
Asset depletion path: The asset-based path where usable assets are divided by 60 months to create qualifying monthly income.
Seasoning: The period funds must sit in an account so the lender can see they are yours and stable.
Haircut: The percentage of an asset’s balance that does not count toward qualifying.
Debt-to-income test: The comparison of your monthly debts, including the new housing payment, against your qualifying income.
Business-purpose loan: A loan made for an investment or commercial purpose, treated differently from a loan to buy a home to live in.
Frequently Asked Questions
Do I still have to file taxes if I use an asset-based mortgage?
Yes. Your obligation to file does not change with how your mortgage is qualified. The loan simply does not use your returns as the qualifying document. Keep your records in order anyway.
Will the lender see my standard personal-income documentation?
Not as a standard step on the asset qualifier path or the asset depletion path. The file runs on statements, credit and the property. If you add documented income to supplement the file, that income needs its own proof, and a lender may ask for more in a case-by-case review.
Can I use a 401(k) or IRA?
Yes, with a haircut. On the asset qualifier path, retirement balances count at 90% under age 59½ and 100% at 59½ or older. On the depletion path, they count at 70% at any age. Eligibility is subject to underwriting.
Does Virginia require something different?
No. The program figures do not change by state. Virginia is one of 16 states where Lendmire’s consumer mortgage lending is licensed, and the leverage, seasoning and credit figures above apply to Virginia borrowers the same way.
Can I buy a rental with this loan?
Only on the asset depletion path, at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out, subject to underwriting. If the rental is a business purchase and rent should carry the loan, a DSCR loan usually fits better. DSCR loans qualify primarily on property-level rental income covering the payment, subject to lender guidelines.
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.
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.
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. Federal Register – Ability-to-Repay and Qualified Mortgage Standards under the Truth in Lending Act
2. Doss Law – Business Purpose Exemption Simplified
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 Asset Verification Works on a Mortgage With No Tax Returns · Can Equity in a Rental Property Help You Qualify for an Asset-Based Mortgage?
Guides: Asset-Based Mortgage in Virginia
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
Required disclosures. Lendmire (NMLS# 2371349) operates as a licensed mortgage broker, not a direct lender or depository. The discussion in this article is general in nature and should not be relied upon as financial, legal, or tax advice — every investment scenario is unique and should be reviewed by a qualified professional. Any loan inquiry is subject to lender underwriting, and this article is not a commitment to lend or a guarantee of approval. Mortgage rates, loan terms, and program guidelines vary by borrower, property, and state, and may change without notice. Equal Housing Opportunity. Verify licensure at NMLS Consumer Access.