The Quick Read: Yes, through non-QM asset-based mortgage programs placed with select lenders, you can finance a second home in Alabama using your account balances instead of paycheck or tax-return income, as long as you will personally use the home, the assets are documented with statements, and the file clears credit, appraisal and underwriting review. The program asks for no traditional personal-income documentation, pay stubs or employment verification. It does not skip underwriting. Your balances do the work your income would normally do.
- Two paths exist. On one, your eligible assets must cover the entire loan. On the other, your assets are converted into monthly qualifying income.
- Leverage differs by path. On the asset qualifier path, the maximum is up to 80% LTV on a purchase of a second home. On the asset depletion path, the maximum is also up to 80% on a second-home purchase.
- Assets stay yours. The house secures the loan. Your accounts only prove you can repay it.
- Occupancy decides the lane. A second home you will use personally fits here. A rental bought mainly for income usually belongs in a different loan.
- Everything is subject to underwriting. Figures are ceilings and floors, not offers.
Which Path Fits Your Balance Sheet?
Pick the path first, because the two never blend on a single file. Across Lendmire’s wholesale network, asset-based mortgage programs come in two forms. A borrower is reviewed on one path at a time.
The asset qualifier path is the simpler idea. Eligible assets, after the credit percentages below, must equal or exceed the whole loan amount. No employment or income is documented. It fits a borrower with large, liquid balances who wants the cleanest file.
The asset depletion path treats assets as income. Usable assets are divided by 60 months to create a monthly qualifying income. That income must carry the full housing payment and other debts through the debt-to-income test. It fits a borrower whose balances are large but who wants to keep the loan sized well below total assets.
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| How you qualify | Assets cover the whole loan | Assets become monthly income |
| Second-home purchase LTV | Up to 80% | Up to 80% |
| Refinance LTV, second home | Up to 75% | 80% 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 |
All figures are subject to underwriting and apply through select programs. The lender’s own calculation governs.
Consider a borrower who sold a business and holds seven figures in cash and brokerage accounts but shows little current income. If the loan is modest relative to those balances, the qualifier path is usually the first look. If the loan is large relative to assets, the depletion path may fit better, or the file may not fit at all.
What Counts as an Asset, and How Much?
Not every dollar counts at face value. Each path applies its own credit percentage to each account type, and the two tables do not mix. A lender may also limit which accounts qualify.
| Asset type | Qualifier path | Depletion path |
|---|---|---|
| Brokerage / securities | 100% | 80% |
| Certificates of deposit | 100% | 100% |
| Savings, money market, cash accounts | 100% | 100% |
| 401(k) and IRA | 90% under 59½; 100% at 59½ or older | 70% at any age |
| Private stock | Not published | 75% |
| Real-estate equity | Not published | 60% |
Some asset types are not eligible on the depletion path. These include custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options and non-vested restricted stock units. Cryptocurrency, precious metals and collectibles are not published as eligible on either path. The documented route is to convert them into a seasoned cash balance in a regulated account, with the source reviewed by the lender. Pledged or borrowed funds do not count. On the depletion path, cash-out proceeds never count as qualifying assets either.
Retirees feel this table most. A 401(k) under age 59½ counts at 90% on the qualifier path. At 59½ or older it counts at 100%. On the depletion path it counts at 70% at any age. A retirement-heavy borrower often does better on the qualifier path if the loan is sized to match.
Two Worked Examples
These are illustrations only. The lender’s own calculation governs.
Qualifier path. Take an $800,000 loan. The borrower holds $330,000 in brokerage accounts (100% counts, so $330,000), $300,000 in a 401(k) under 59½ (90% counts, so $270,000) and $200,000 in savings (100% counts, so $200,000). That totals $800,000 of usable assets, which covers the loan. The file is reviewed on assets alone, subject to underwriting.
Depletion path. Take $1,500,000 in securities (80% counts, so $1,200,000) plus $300,000 in cash (100% counts, so $300,000). That is $1,500,000 usable. Divided by 60 months, it produces $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the debt-to-income test.
On the depletion path, minimum assets also apply. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When depletion is the only income source, liquid assets must also be at least $250,000. Asset-derived income may instead supplement documented income, up to a 45% debt-to-income ratio, and the minimum-assets rule is waived in that case.
Standard agency-style asset programs treat this very differently. They use far longer divisors than the 60 months here, so each dollar of assets produces less qualifying income. That gap is why borrowers with plenty of money but little income often end up in non-QM programs.
Is It Really a Second Home?
Occupancy decides which loan you can use, and lenders ask you to certify your intended use. A second home is a consumer mortgage. It is for a home you will personally use, and rent is not counted toward qualifying. Under an asset-based second-home loan, the file is reviewed on assets, not on what the property might earn.
The regulatory line supports that. Regulation Z exempts business-purpose credit, and the official commentary treats a home you will occupy for more than 14 days in the coming year as not purely a rental. The Federal Register text gives a beach house as its example. If you will stay there a month each summer and rent it the rest of the year, it counts as owner-occupied. That is a very Gulf Coast fact pattern.
A business-purpose label does not make a loan free of compliance duties, either, as Hunton’s analysis of investment mortgage rules points out. Misstating your intent on an occupancy certification is a real risk, so match the loan to the plan.
| Your plan | Typical lane |
|---|---|
| Personal use most of the year | Asset-based second-home mortgage |
| Mixed use, some rental weeks | Usually still a second home; confirm with the lender |
| Rental income is the point | Investment-property financing |
Investment property is available on this program only on the asset depletion path. There the loan is business-purpose, and the leverage is lower: up to 65% LTV on a purchase or rate-and-term refinance, and 60% on a cash-out. Every figure here varies by lender and program — guidelines, property type, leverage, and credit profile all apply.
For a rental-first purchase, most investors move to a different product. 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. They qualify primarily on property-level rental income covering the payment, subject to lender guidelines. They also tend to fit an Alabama short-term rental better than a personal-use second-home loan does.
An asset-based second-home loan is still a consumer mortgage. Standard consumer mortgage disclosures apply to it, and the loan is underwritten individually.
What Stays Documented
“No income documentation” never means “no documentation.” Every counted account is documented, and the lender reviews where the money came from.
- Qualifier path seasoning: 60 days of seasoning and two months of statements for each qualifying account.
- Depletion path statements: 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.
- Credit: a 600 minimum score on the qualifier path. On the depletion path, the lender’s score and loan-amount matrix applies, and a first-time investor needs 700.
- Housing history: 0x30x12, meaning no late payments of 30 days or more in 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 4 years of seasoning.
- Reserves: none required on the qualifier path at or below 75% loan-to-value. Above that, the lender sets them. The depletion path has no published reserve months.
Programs change, and every file is judged on its own facts. The assets are not pledged. They stay in your accounts and keep working. Only the property secures the loan.
The Alabama Side of the Deal
The program does not change by state. Alabama is one of the 16 states where Lendmire’s consumer mortgage lending is licensed, and the figures above apply the same way here. What changes in Alabama is the property.
Gulf Shores and Orange Beach are condo-heavy. Condo project eligibility can add an overlay on any financing. Lenders review project questionnaires, and rental-pool or resort-style arrangements can complicate approval. A condo that looks ideal for personal use may still fail a lender’s project review, so ask early.
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 matters even for a personal-use second home if you plan to rent it for some weeks.
Lake and inland properties usually raise fewer project questions. Whichever you choose, expect a full appraisal and title review. Borrowers elsewhere in the Southeast can compare how this works across state lines.
Alternatives and Trade-Offs
An asset-based mortgage is not always the right tool. Run the alternatives against it before you commit.
| Option | Strength | Trade-off |
|---|---|---|
| Pay cash | No loan to repay | Ties up capital |
| Securities-backed credit line | Keeps portfolio invested | Margin risk if markets fall |
| Home equity borrowing | Uses existing property | Puts your primary home at risk |
| Bank statement program | Documents income via deposits | Needs a deposit history |
| Asset-based mortgage | Reviewed on verified assets | Typically needs large, documented balances |
The tradeoff to weigh is liquidity. On the qualifier path, your assets must cover the whole loan on paper, though they stay in place. If you would rather keep the portfolio fully invested and your income is documentable, a bank statement program may be cheaper to set up. If you could pay cash but prefer to preserve it, the asset qualifier path is built for exactly that.
Selling investments to fund a purchase has tax consequences. Tax treatment varies; consult a qualified professional.
Who This Does Not Fit
Be honest about the limits. This is probably the wrong tool if:
- Balances are thin relative to the loan, especially on the depletion path with its minimum-assets rule.
- Most of your wealth is in crypto, collectibles or other assets that are not published as eligible.
- A recent credit event, multiple bankruptcies or a recent housing event falls inside the seasoning windows.
- The property is really a rental, in which case investment-property financing should lead the conversation.
- The condo project fails the lender’s eligibility review.
Key Terms Defined
Asset qualifier: A path where eligible assets, after credit percentages, must cover the entire loan, with no income documented.
Asset depletion: A path that divides usable assets by 60 months to create monthly qualifying income.
Non-QM: A mortgage that falls outside standard agency guidelines and is underwritten under a lender’s own program rules.
Seasoning: The length of time funds have sat in an account before they count.
Haircut: The percentage of an asset’s balance that does not count toward qualifying.
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. Lendmire is a broker arranging financing through select lenders in its network. It is not a commitment to lend.
Frequently Asked Questions
Is this a no-doc loan?
No. Every file is fully underwritten. You skip traditional personal-income documentation, pay stubs and employment verification, but your assets are documented with statements. Credit, appraisal, title and the property review all still apply.
Can my 401(k) or IRA count?
Yes, with haircuts. On the asset qualifier path, retirement balances count at 90% under age 59½ and 100% at 59½ or older. On the asset depletion path they count at 70% at any age. Subject to underwriting.
Can I rent the home out part of the year?
Some personal rental weeks may be fine, but occupancy is certified and reviewed. Rent is not used to qualify on a second-home loan. If rental income is the point, ask about investment-property financing instead, which is available only on the depletion path here.
Do my accounts become collateral?
No. The house secures the loan. Your accounts only prove repayment capacity and stay where they are.
What if my assets are mostly in crypto or business accounts?
Those are not published as eligible. The documented route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
Lendmire’s asset-based mortgage in Alabama page presents the program for Alabama borrowers.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages for self-employed and high-net-worth borrowers are arranged through wholesale lenders on primary residences, second homes and investment properties; every file is underwritten by the lender under its program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. CFPB Regulation Z, § 1026.3 (exemptions)
2. Federal Register, Truth in Lending final rule
3. Hunton Andrews Kurth, Beware Business Purpose: Regulatory Implications for Investment Mortgages
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 You Buy a Second Home in Tennessee on Assets Instead of Income? · Can You Relocate to Virginia and Buy a Home on Assets Before You Have Local Income? · How Retirees Moving to New Mexico Buy a Home on Assets
Guides: Asset-Based Mortgage in Alabama
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.