The Quick Read: You qualify on one of two paths. Either your eligible, documented balances cover the whole loan outright, or they convert into monthly qualifying income that carries the payment. On either path, a second-home purchase in Virginia is reviewed on your accounts rather than your paycheck, subject to underwriting.
- Asset qualifier path: eligible assets, after the credit percentages, must equal or exceed the entire loan. Leverage runs up to 80% on a purchase of a second home, with loans up to $4,000,000.
- Asset depletion path: usable assets divided by 60 months become monthly qualifying income. That income must carry the housing payment and other debts through the debt-to-income test.
- Documentation: your accounts are always documented. Expect 60 days of seasoning and two months of statements per account on the qualifier path.
- Credit: the qualifier path has a 600 minimum score. The depletion path follows the lender’s matrix.
- Occupancy: if you plan to rent the home out, it may belong in a different loan category entirely.
All figures here are ceilings and floors from select programs, not offers. Every file is underwritten individually.
Who This Loan Fits (and Who Should Skip It)
This loan fits people whose balances are large and whose documented income is small. Think of a retiree living on a portfolio, someone who just sold a business, or a household that received an inheritance or a settlement. Early-retired professionals fit too.
Lenders have a name for the borrower who looks thin on a tax return and strong on a balance sheet. Trade press describes two core audiences for non-QM lending, which means loans that fall outside standard agency underwriting boxes. Scotsman Guide says DSCR loans serve investors focused on rental performance, while asset depletion serves asset-rich households that want to preserve liquidity. The same article, citing Cotality data, puts non-QM at about 5% of originations, up from about 3% several years earlier.
You probably should skip this product in three situations. The first is steady traditional employment income that already clears a standard second-home mortgage. The second is a plan to run the house mainly as a rental. The third is balances too small to clear the minimums covered below.
A vacation home also changes the question. Most buyers ask whether they can afford the house. The better question is which of your accounts will do the qualifying work, and how much each one counts for.
Key Terms Defined
Asset qualifier mortgage: a loan where eligible assets, after credit percentages, equal or exceed the entire loan amount. No employment or income is documented.
Asset depletion mortgage: a loan where usable assets are divided by a set number of months to create monthly qualifying income. In the network Lendmire places files with, the divisor is 60.
Haircut: the share of an account’s balance a lender refuses to count. A retirement account counted at 70% has a 30% haircut.
Seasoning: how long money has sat in an account before you apply. It shows the funds are yours and not a recent loan or transfer.
Debt-to-income (DTI): your monthly debts, including the new housing payment, compared with your monthly qualifying income.
Second home: a property you use personally, not one you buy to rent out.
Two Paths: Assets Cover the Loan, or Assets Become Income
A borrower is qualified on one path at a time. The two sets of percentages never blend, so always check which path a figure belongs to.
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| How assets are used | Must cover the entire loan | Divided by 60 months into income |
| Second-home leverage | Up to 80% purchase, 75% refinance | Up to 80% purchase or rate-and-term, 60% cash-out |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit | 600 minimum score | The lender’s matrix |
| Statements | 60 days seasoning, two months each | One 120+ days old, one within 45 days |
| Income documented | None | Derived from assets, run through DTI |
On the qualifier path, the question is simple: do your eligible assets equal or exceed the loan? No income is documented, so there is no debt-to-income test. The lender’s review rests on the assets themselves.
On the depletion path, the question is different. Can the income your assets produce, on paper, carry the full housing payment plus your other debts? That is a DTI test. The divisor matters a great deal here. Programs outside this network may spread assets over a longer period, which produces less monthly income from the same balance.
Cash-out proceeds never count as qualifying assets on the depletion path. The lender sets whether cash-out is allowed on the qualifier path at all, and that detail is not published.
How Underwriting Treats Your Accounts, Step by Step
Underwriting follows a repeatable order, and knowing it lets you prepare before you make an offer. Most programs Lendmire places files with work through these steps.
1. Occupancy. The underwriter decides whether the home is a second home or an investment property. For personal use, it is a second home. That choice controls which leverage figures apply.
2. Asset inventory. You list every account you want counted. The lender wants statements for each one, not a summary you typed up.
3. Credit percentages. On the qualifier path, brokerage, CDs, money market and savings count at 100%. Retirement accounts count at 90% under age 59½ and 100% at 59½ or older. Accounts combine.
4. Depletion haircuts. On the depletion path, cash and CDs count at 100%. Securities count at 80%, private stock at 75%, retirement accounts at 70% at any age, and real-estate equity at 60%.
5. Seasoning check. The lender confirms the statement dates meet the path’s requirements.
6. The test. On the qualifier path, usable assets must cover the whole loan. On the depletion path, usable assets divided by 60 months must carry the payment and debts through DTI.
7. Property review. The usual purchase contract, appraisal and title work apply. For a second home, the appraisal is typically a single-family form.
8. Reserves. On the qualifier path, none are required at or below 75% loan-to-value. Above that, the lender sets them. The depletion path has no published reserve months.
Four things decide the outcome in the end. Those are net eligible assets after percentages and cash to close, the divisor on the depletion path, your existing debts, and your credit and property type.
A Worked Example for Each Path
These examples are illustrative. The lender’s own calculation governs.
Qualifier path. Picture a buyer seeking an $800,000 loan on a Virginia second home. She holds $330,000 in brokerage accounts, which count at 100%, so $330,000 counts. She has $300,000 in a 401(k) and is under 59½, so it counts at 90%, which is $270,000. She also has $200,000 in savings, counted at 100%.
Together that is $800,000 of usable assets, enough to cover the loan. She is reviewed on assets alone, subject to underwriting. Because she borrows up to 80% of the value on a purchase, the lender sets any reserves.
Depletion path. Say a recently retired couple holds $1,500,000 in securities, which count at 80%, so $1,200,000 is usable. They also hold $300,000 in cash at 100%. That makes $1,500,000 usable.
Divide by 60 months and you get $25,000 of monthly qualifying income. That income then carries the housing payment and their other debts through the debt-to-income test. They clear the minimum-assets rule because their qualified assets exceed the lesser of $1,000,000 or 1.25 times the loan.
Notice what the examples show. The same couple with the same balances could land on either path. The better path usually depends on the loan size, the mix of accounts, and whether you want income or coverage as the test.
Second Home or Rental? Where the Occupancy Line Sits
A vacation home you use yourself is a second home. A vacation home you buy to rent out is an investment property. That line matters more than any other here.
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 looks at whether the property’s rent covers its own payment. Lendmire’s asset-based mortgage programs look at you.
You can still use the depletion path for an investment property, but leverage is lower. It runs up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. A first-time investor on that path needs a 700 score.
Occupancy has to be honest. Misstating how you will use the home is a fraud risk, and underwriters ask directly.
If your plan is a rental from day one, a DSCR loan may fit better than either asset path. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income.
Where the General Rule Breaks
The basic rule is that your balances count at their credit percentage. Several situations bend or break it.
Assets can’t be counted twice. Money you use for the down payment, closing costs or required reserves cannot also generate qualifying income. The lender nets those out first.
Retirement accounts get special handling. The qualifier path counts them at 90% under 59½ and 100% after. The depletion path counts them at 70% at any age. If you would owe a penalty to touch the money, ask how the lender treats it. 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.
Some assets are not eligible on the depletion path. Those are 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 funds do not count at any percentage. The same goes for borrowed funds and for business accounts beyond your ownership share. The documented route is to convert them to cash in a regulated account and season the balance. The lender will review where the money came from.
Minimums on the depletion path are real. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When assets are your only income source, they must also be at least $250,000 liquid. If asset-derived income only supplements documented income, it can go up to a 45% debt-to-income ratio, and the minimum-assets rule is waived.
Housing events have a waiting period. Multiple bankruptcies are not eligible. A housing event needs 4 years of seasoning on the depletion path. The lender looks at a 0x30x12 housing history and considers one 30-day late in the last twelve months case by case.
The agency version is narrower. The Fannie Mae Selling Guide has its own employment-related assets rule. It applies to principal residences and second homes, and it excludes investment property. That narrowness is why many asset-rich buyers look at non-QM instead. Agency rules do not govern the programs described here.
What People Get Wrong
“No income documentation means no documentation.” That is wrong. Your accounts are documented on both paths, and the lender reviews statements for every account it relies on. A federal CFPB compliance guide lists income or assets, other than the value of the property itself, as the first of eight ability-to-repay factors. It names bank and investment statements as acceptable verification. Qualifying on assets is a different way to prove capacity. It is not an exemption from proof.
“I have to sell my investments.” No. The math proves capacity. You keep your portfolio, though any money used for the down payment or cash to close leaves it.
“It’s a DSCR loan.” No. DSCR qualifies the property. This product is reviewed around you.
“Asset-based means hard money.” No. Hard money is short-term lending against collateral. An asset qualifier mortgage is a long-term consumer mortgage. Your assets prove capacity, and the home is the collateral.
“Virginia has special rules for this.” Virginia identifies where the property sits and where you live, and nothing more.
Your Options Compared
Each option below follows that program’s own rules. They are not interchangeable.
| Option | Is reviewed around | Best for |
|---|---|---|
| Asset qualifier | Assets covering the loan | Asset-rich, income-light buyers |
| Asset depletion | Assets converted to income | Buyers who want income-based DTI |
| DSCR | The property’s rent | Rental-first purchases |
| Bank statement | Income shown by deposits | Self-employed with strong deposits |
| Agency second home | Documented income and DTI | Buyers with steady traditional employment income |
| HELOC-funded down payment | Equity in another home | Owners who prefer to tap equity |
A HELOC is a home equity line of credit, and a bank statement program is for borrowers who document income with deposits. An all-cash purchase followed by a delayed-financing refinance is another route some buyers weigh against asset-based qualifying. Pricing for asset-based loans is typically above agency pricing, so weigh that against the flexibility.
The honest tradeoff comes down to liquidity. Assets you rely on to qualify are effectively tied to the file. If your balances are thin after the down payment, a different structure may fit better.
What the Decision Looks Like in Practice
Start with your accounts, not the listing. Pull statements for everything you might count, and check them against the seasoning rules. On the qualifier path, that is 60 days and two months of statements per account. On the depletion path, it is a statement at least 120 days old plus one within 45 days. Funds from the sale of a business, an inheritance or a legal settlement are excused from that seasoning on the depletion path.
Next, decide which path is likely stronger. If your usable balances after the credit percentages clear the whole loan, the qualifier path is the cleaner story. If they do not, check whether the depletion math and the minimum-assets rule work.
Then decide the home’s role. If it is personal-use only, stay on a second-home file. If it will carry real rental income, consider whether DSCR fits better.
Finally, keep large deposits explainable. A big transfer from last month needs a paper trail. The lender wants to see where the money came from, and a clean story removes surprises.
Lendmire’s consumer mortgage lending is licensed in 16 states, Virginia among them, and the brokerage arranges these loans through select lenders in its wholesale network. Qualification is subject to lender guidelines, credit approval, property review, and underwriting, and none of this is a commitment to lend.
Frequently Asked Questions
Is an asset qualifier mortgage the same as asset depletion?
They are close cousins but not identical. The asset qualifier path requires eligible assets to cover the entire loan, with no income documented. The asset depletion path divides usable assets by 60 months into income and runs it through DTI.
Can I count my 401(k) or IRA?
Yes, at a percentage. On the qualifier path, retirement accounts count at 90% under 59½ and 100% at 59½ or older. On the depletion path they count at 70% at any age. You do not have to cash them out to use them for qualifying, though any money you withdraw for the down payment leaves the count.
Can I rent out the vacation home?
It depends on how the file is classified. A personal-use second home is reviewed one way, and a rental purchase is an investment property reviewed another way. Underwriters ask about intended use, so answer accurately.
What credit score do I need?
The qualifier path has a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix. A first-time investor on the depletion path needs 700. Housing history is typically reviewed at 0x30x12, with one 30-day late considered case by case.
Does anything about the loan change because the home is in Virginia?
The program figures do not change by state. Taxes, insurance and local prices are context for your budget, not program parameters. Lendmire’s consumer mortgage lending is licensed in Virginia, and the property and your occupancy plans are reviewed like any other file.
Where to Start
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. Reach the team at 828-256-2183 or request a quote.
A Virginia vacation home that fits the occupancy rules and the account math is usually settled long before the first showing, because the balance sheet decides what is possible.
Lendmire’s asset-based mortgage in Virginia page presents the program for Virginia borrowers.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage broker that arranges bank statement, P&L-only, 1099-only and asset-based home financing in 16 states through wholesale lenders, on primary residences, second homes and investment properties. Every option is subject to the lender’s guidelines and full underwriting. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Scotsman Guide: Which groups are driving non-QM lending
2. Fannie Mae Selling Guide B3-3.4-06: Employment-Related Assets as Qualifying Income
3. CFPB Ability-to-Repay and Qualified Mortgage compliance guide
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 Two Montana Retirees Buy a Home Together on an Asset Qualifier Mortgage? · Pledged Asset Line vs Asset Qualifier Mortgage for a Virginia Home Purchase · Can You Get an Asset Qualifier Mortgage With a Co-Signer?
Guides: Asset-Based Mortgage in Virginia
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.