The Quick Read: A second home in Indiana can be qualified on assets through one of two paths: the asset qualifier path, where eligible assets cover the entire loan and no income is documented, or the asset depletion path, where usable assets divided by 60 months become qualifying monthly income, subject to underwriting and the occupancy being a true second home. A borrower is qualified on one path at a time, never a blend of both. The assets stay in your accounts and are never sold or pledged as collateral.
- The asset qualifier path allows up to 80% loan-to-value on a purchase and 75% on a refinance of a second home, with loans up to $4,000,000.
- The asset depletion path allows up to 80% on a second-home purchase and 60% on a cash-out refinance, with loans from $125,000 to $3,500,000.
- Assets are documented on both paths. No income documentation never means no documentation.
- A home you plan to rent out most of the year is usually an investment property, which changes the path and the leverage.
Which Path Fits an Indiana Vacation-Home Buyer?
The path depends on how large your balances are compared with the loan. If eligible assets equal or exceed the whole loan, the asset qualifier path fits. If your assets are large but smaller than the loan, the asset depletion path turns them into monthly income.
This mortgage suits a particular kind of buyer. Think of a retiree living on a portfolio, someone who sold a business, an heir who received an inheritance or settlement, or an early-retired professional. Their balances are large and their documented income is not. Conventional underwriting reads that file as weak. Asset-based underwriting reads it as strong.
The asset qualifier path is the simpler one. Eligible assets, after the credit percentages below, must cover the entire loan amount. No employment or income is documented. The asset depletion path is closer to ordinary underwriting. The derived income has to carry the full housing payment and your other debts through a debt-to-income test.
Lendmire is a mortgage broker. It arranges these loans through select lenders in its network, and every file is underwritten individually. Its consumer mortgage lending is licensed in 16 states, Indiana among them. The programs are the same for an Indiana buyer as for any other. Indiana only shapes the property, not the program figures.
How Underwriting Treats Your Assets, Step by Step
Underwriting follows the same sequence on most files: confirm occupancy, list the accounts, apply the credit percentages, check seasoning, and compare the result with the loan. Here is the order the brokerage sees most often.
1. Confirm the home is a second home. You must plan to use it personally. Stating the wrong occupancy to reach a product is a misrepresentation, not a workaround.
2. List every account you plan to count. That means brokerage, CDs, money market, savings, and retirement accounts. Accounts combine.
3. Apply the credit percentages for your path. The tables below show the shares that count.
4. Check seasoning and statements. Each path has its own statement rules.
5. Compare the result with the loan. On the qualifier path, usable assets must cover the loan. On the depletion path, divide usable assets by 60 months and run the income through the debt-to-income test.
6. Underwrite the property and credit. The appraisal, title, and credit review still happen. Approval is never guaranteed.
Asset qualifier path: what counts
| Asset type | Share that counts |
|---|---|
| Brokerage accounts | 100% |
| Certificates of deposit | 100% |
| Money market | 100% |
| Savings | 100% |
| 401(k) or IRA, under age 59½ | 90% |
| 401(k) or IRA, 59½ or older | 100% |
Asset depletion path: what counts
| Asset type | Share that counts |
|---|---|
| Cash accounts | 100% |
| Certificates of deposit | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts, any age | 70% |
| Real-estate equity | 60% |
Several items are not eligible on the depletion path. These include 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 borrowed or pledged funds are not published as eligible on either path. The documented route is to convert them to a seasoned cash balance in a regulated account. The lender then reviews the source of those funds.
Seasoning, Statements, Credit and Reserves
The qualifier path asks for 60 days of seasoning and two months of statements for each qualifying account. The depletion path asks for statements at least 120 days old at application, plus the most recent statement within 45 days. Sale-of-business, inheritance, and legal-settlement funds are excused from that seasoning on the depletion path.
Large deposits are the most common source of added review. A transfer between your own accounts is easy to explain with both statements. A deposit with no paper trail is not. Keep the statements that show where money came from before you apply.
Credit works differently on each path. The qualifier path has a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix. Housing history is usually reviewed at 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible, and a housing event needs 4 years of seasoning on the depletion path.
Reserves are straightforward on the qualifier path. None are required at or below 75% loan-to-value. Above that, the lender sets them, so an 80% purchase will carry a reserve requirement. The depletion path has no published reserve months. The depletion path also has minimum assets: the lesser of $1,000,000 or 1.25 times the loan balance. When asset depletion is your only income source, qualified assets can never fall below $250,000 in liquid form. Asset-derived income may also supplement documented income up to a 45% debt-to-income ratio, and then the minimum-assets rule is waived. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
Two Worked Examples
These examples are illustrative only. The lender’s own calculation governs, and all figures are subject to underwriting.
Asset qualifier path. Say you are seeking an $800,000 loan on a second home. You hold $330,000 in brokerage accounts, which counts at 100%, or $330,000. You also hold $300,000 in a 401(k) while under age 59½, which counts at 90%, or $270,000. You hold $200,000 in savings, which counts at 100%, or $200,000. Together that is $800,000 of usable assets, which matches the loan, so the file is reviewed on assets alone. Nothing is documented about employment or income. The statements are documented, though, and each account needs its two months of statements.
Asset depletion path. Say you hold $1,500,000 in securities, which counts at 80%, or $1,200,000. You also hold $300,000 in cash at 100%. That gives $1,500,000 of usable assets. 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 debt-to-income test.
The difference matters when you choose between the paths. The qualifier path rewards a large pile of cash relative to the loan. The depletion path rewards a large portfolio when the loan is much bigger than the cash. Sale proceeds from a business often fit the depletion path better, because they arrive as one seasoned balance.
For more on the depletion side, see Lendmire’s article How to Finance a Second Vacation Home on Asset Depletion.
Does a Vacation Home Count as a Second Home?
It counts when you will use it personally and control it as your own. A lender treats a true second home as an owner-style consumer file. A property bought mainly to rent is a different file. Rent generally cannot help a second-home file qualify, so expect to qualify on your assets alone.
This is why occupancy decides the product. On a consumer second-home loan, the lender must make a reasonable, good-faith determination that you can repay. That duty comes from Regulation Z’s ability-to-repay rule. The lender can rely on income, assets, or both, and it has to verify the assets it relies on with third-party records. Ballard Spahr’s Consumer Financial Services Review explains how that verification works for non-qualified mortgages. That is the reason bank and brokerage statements are required here.
Rental use is the line most borrowers misjudge. If you plan to rent the home out most of the year, most lenders will not treat it as a second home.
One more distinction applies. The IRS applies its own personal-use test to vacation homes under IRS Publication 527. That test is separate from how a lender classifies occupancy, so tax treatment varies and borrowers should consult a qualified tax professional.
If you are buying the home purely to rent, the better route is a different loan. 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. The property’s rent covers the payment instead of your personal assets. Lendmire’s complete DSCR loans guide explains how that route works. Programs below 1.00 coverage are available through select lenders in the network, but loan-to-value and terms adjust.
Indiana Property Types That Affect the File
Indiana vacation homes fall into a few common types, and each one raises its own underwriting questions. Lake Michigan dune communities, northern lake country, Brown County and Lake Monroe cabins, and Ohio River towns all draw second-home buyers. The program figures do not change with the region.
The property does. Here are the questions that most often come up:
- Seasonal cabins. Is the home winterized and year-round habitable? Lenders review condition and access as part of the appraisal.
- Lakefront and river homes. Flood zone status and insurance availability can reshape the file. Budget for both, because they vary by county and property.
- Wells and septic. Rural cabins often have both. Lenders may ask for inspections or test results.
- Condos and townhomes in resort communities. The HOA questionnaire and condo certification need to be complete. An incomplete questionnaire is a common reason a condo file stalls.
- Shared-ownership or rental-pool arrangements. The lender usually wants you in control of the calendar on a second home.
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. That caution applies even to a second home you hope to rent a few weekends a year. The rent does not help the file qualify.
How the Paths Compare With Other Ways to Pay for the Home
Asset-based financing is one option among several for a vacation home. The comparison below describes each program’s own rules. The figures for the two asset paths are the network figures given above.
| Option | What carries the file | Best fit |
|---|---|---|
| Asset qualifier path | Assets cover the entire loan | Large cash balances |
| Asset depletion path | Assets converted to income | Large portfolio, smaller cash |
| Conventional second home | Documented income and debt ratios | Steady W-2 earners |
| Bank statement program | Income documented by deposits | Self-employed with cash flow |
| DSCR loan | Property rent covers the payment | Pure rental purchases |
| HELOC on another home | Equity in the home you own | Short-term gap funding |
The bank statement program is for borrowers who document income with deposits. DSCR is for business-purpose rental financing. Neither fits a retiree with no regular deposits who plans to use the home personally. That is where asset-based qualification earns its place.
Where the General Rule Breaks
The general rule is simple: assets count at their credit percentage and the loan fits within the leverage ceiling. These cases are where it bends.
Retirement accounts under 59½. On the qualifier path, a 401(k) or IRA counts at 90% under age 59½ and at 100% at 59½ or older. On the depletion path, retirement accounts count at 70% at any age.
Cash-out proceeds. On the depletion path, cash-out proceeds never count as qualifying assets. Whether a qualifier-path cash-out is allowed is set by the lender and is not published, so do not plan around it.
Down payment and closing funds. Money that leaves your account to close is no longer a post-closing balance. The lender reviews how those funds are sourced, and its own calculation governs how they are treated.
Hybrid use. Some owners rent for part of the year. On the depletion path, an investment property carries lower leverage: 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. Asset-based financing for investment property exists only on the depletion path. The qualifier path covers principal residences and second homes.
Unusual assets. Crypto, metals, and collectibles must be converted to seasoned cash first. Borrowed funds do not count.
A later change of use. If the home drifts into full rental use, a later refinance would carry the investment-property label, and DSCR may fit better.
For tax planning, a cost-segregation strategy can conflict with the second-home label on a loan application. That is a decision to make with your tax advisor before you apply, not after.
Who Should Look Elsewhere
This mortgage is a poor fit if you have strong, documentable income and modest assets. A conventional second-home loan may serve you better. It is also a poor fit if your balances are mostly in accounts that do not count, such as foreign funds or restricted stock units.
It is a good fit when your balances are large and seasoned, your income is light, and you want to keep your portfolio invested. The assets stay in your accounts, so you avoid selling investments to buy the home. The trade-off is that the usable base has to be large, and the home does not become a cash-flow asset on paper.
Key Terms Defined
Asset qualifier path: A way to qualify where eligible assets, after the credit percentages, must equal or exceed the entire loan amount.
Asset depletion path: A way to qualify where usable assets divided by 60 months become monthly income for the debt-to-income test.
Usable assets: The share of each account balance that counts after the program’s percentages are applied.
Seasoning: The period an asset must sit in your account, shown by statements, before it counts.
Debt-to-income test: A comparison of monthly debts, including the new housing payment, to qualifying monthly income.
Frequently Asked Questions
Do I have to sell my investments to buy the home?
No. The assets stay in your accounts and are not collateral. The property secures the loan. The lender only counts the balances to qualify you, and the statements must show seasoned funds.
Can I use my 401(k) or IRA?
Yes, on both paths, at a reduced share. On the 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.
Does this mean no documentation?
No. Employment and income are not documented on the qualifier path, but the assets are. Every qualifying account needs statements, and the lender may ask for the source of large deposits.
Can I rent the Indiana home to cover costs?
Rent generally does not help a second-home file qualify, and heavy rental use usually moves the home toward an investment-property classification. On the depletion path, investment property has lower leverage. Pure rentals usually fit DSCR financing better.
What is the maximum loan?
Loans go up to $4,000,000 on the qualifier path and from $125,000 to $3,500,000 on the depletion path, subject to underwriting. Leverage is capped by transaction and occupancy as described above.
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. Call 828-256-2183 or request a quote. Lendmire arranges these loans as a broker, and every loan is subject to lender guidelines and is not a commitment to lend.
Indiana’s lake and river homes will keep drawing buyers with large balances and small paychecks, and the files that go smoothly are the ones where the statements and the property paperwork are ready first.
Lendmire’s asset-based mortgage in Indiana page presents the program for Indiana 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 Regulation Z § 1026.43
2. Consumer Financial Services Review
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Asset Qualifier vs Asset Depletion for an Heir · Asset Qualifier vs Asset Depletion for a FIRE Household · Is an Asset Qualifier Mortgage Harder to Get Than an Asset Depletion Loan?
Guides: Asset-Based Mortgage in Indiana
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
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.