The Quick Read: Usually, because a retiree with large balances and a documented pension can qualify through select asset-based programs, either on assets alone or on assets that convert into income, subject to underwriting. The pension is not required on one path and adds to the file on the other. Terms differ by path, so name the path before comparing any number.
- Assets cover the loan outright: on the asset qualifier path, eligible assets must equal or exceed the entire loan, and no employment or income is documented.
- Assets become income: on the asset depletion path, usable assets divided by 60 months create qualifying income that runs through the debt-to-income test.
- The pension helps on the depletion path: asset-derived income can supplement documented income up to a 45% debt-to-income ratio.
- Leverage differs: the qualifier path allows up to 80% on a purchase and 75% on a refinance, while the depletion path allows 80% on a purchase and 60% on a cash-out for a principal residence.
- Statements still matter: every account is documented, with seasoning rules on both paths.
Two Paths, and You Are Qualified on One at a Time
A borrower runs one path per file, never a blend. The two paths treat the pension very differently.
On the asset qualifier path, the question is simple. After the credit percentages are applied, do the eligible assets equal or exceed the whole loan amount? If so, the file is reviewed on assets. The lender does not ask for traditional personal-income documentation, pay stubs or employment verification. A pension is neither needed nor counted.
On the asset depletion path, the lender converts usable assets into monthly income by dividing by 60 months. That income carries the housing payment and other debts through the debt-to-income test. Here a documented pension can sit beside the asset income, which is why this path fits a retiree with both.
| Factor | Asset qualifier | Asset depletion |
|---|---|---|
| What drives lender review | Assets cover the full loan | Assets divided by 60 months |
| Pension role | Not documented | Documented income it can supplement |
| Purchase leverage | Up to 80% | Up to 80% (primary or second home) |
| Refinance leverage | Up to 75% | 80% rate-and-term, 60% cash-out |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
All figures are ceilings through select programs, subject to underwriting. They are not offers. Lendmire’s asset-based mortgage program page lays out both paths.
How Does a Military Pension Fit In?
A military pension is documented income, so it belongs on the depletion path. Across the wholesale network, the pension usually does the heavy lifting on the income side, and the assets close the gap. The lender decides which documents prove the pension, and a retirement pay statement or award letter is the usual starting point. Expect the lender to ask for it only when the pension is part of the file.
On the qualifier path the pension stays out entirely. A retiree with enough seasoned assets can leave it out, which keeps the file simple.
Asset-derived income may supplement documented income up to a 45% debt-to-income ratio. When assets supplement documented income, the minimum-assets rule is waived. A pension that covers most of the obligation plus a modest portfolio can therefore work, where the same portfolio alone would not.
Disability pay, survivor-plan deductions and combined payments are lender-by-lender questions. Which of those count toward documented income depends on the program, so confirm them before you plan around them.
Which Assets Count, and at What Percentage
Each path weighs assets differently, and the weights are the part retirees most often miss. Retirement balances are the big difference.
Asset qualifier path (share of the balance that counts):
| Asset | Credit |
|---|---|
| Brokerage, CDs, money market, savings | 100% |
| 401(k) and IRA, under age 59½ | 90% |
| 401(k) and IRA, 59½ or older | 100% |
Accounts combine. Many military retirees leave service in their forties or fifties, so the under-59½ line often applies.
Asset depletion path (share of the balance that counts):
| Asset | Credit |
|---|---|
| Cash accounts and CDs | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts, any age | 70% |
| Real-estate equity | 60% |
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.
A retirement plan such as the federal Thrift Savings Plan is typically reviewed as a retirement account, but the lender confirms that on the file. Cryptocurrency, precious metals and collectibles are not published as eligible on either path. The documented route is to convert them to a seasoned cash balance in a regulated account, and the lender reviews the source of that cash. Pledged or borrowed funds do not count.
The Worked Math
These examples use the program’s own percentages. The lender’s calculation governs.
Qualifier path. Say a retiree wants an $800,000 loan. The file 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 is $800,000 of usable assets, which matches the loan, so the file is reviewed on assets alone, subject to underwriting.
Depletion path. Now picture a retiree with $1,500,000 in securities (80% counts, so $1,200,000) and $300,000 in cash (100% counts, so $300,000). Usable assets come to $1,500,000. 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.
Add a documented pension and the income side grows, which lowers the debt-to-income ratio. That gap is why a smaller portfolio can still work when a pension is in the file.
Seasoning, Credit and Minimums
Both paths document the assets. The loan is fully underwritten, and the borrower skips traditional personal-income documentation, pay stubs and employment verification on the qualifier path.
- Qualifier path: 60 days of seasoning, and two months of statements for each qualifying account. The credit floor is 600.
- Depletion path: statements at least 120 days old at application, plus a recent statement within 45 days. Sale-of-business, inheritance and legal-settlement funds are excused from that seasoning. Credit follows the lender’s matrix.
- Depletion minimums: qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. When asset depletion is the only income source, liquid assets never fall below $250,000.
- Housing history: 0x30x12 is the standard. One 30-day late in the last twelve months is considered case by case.
- Credit events: multiple bankruptcies are not eligible, and a housing event needs 4 years of seasoning on the depletion path.
- First-time investors: a first-time investor on the depletion path needs a 700 score.
The seasoning rule catches retirees who just sold a home or moved money between accounts. Moved funds need a statement trail. Large deposits without a paper trail are a common reason an asset file stalls, so keep two clean months of statements for every account before applying.
The qualifier path requires no reserves at or below 75% loan-to-value. Above that, the lender sets them. The depletion path publishes no reserve months.
Why the VA Loan Does Not Settle This
A VA loan is the first thing most retirees think of, and it does not cover a pure rental. VA financing expects the borrower to occupy the home as a primary residence, as Military.com explains in its overview of VA occupancy requirements. The common workaround is a two- to four-unit property where the owner lives in one unit.
That solves a narrow case. A retiree who wants a second home, a larger loan than they want to size to entitlement, or a pure rental usually moves to an asset-based program. For a home to live in, the asset-based programs here cover a principal residence or second home. For an investment property, only the depletion path applies, at lower leverage.
Rental Property Is a Different Lane
If the goal is a rental, the asset depletion path covers investment property at up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. Cash-out proceeds never count as qualifying assets.
Some retirees choose a rental loan that qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. That is a separate product, and a retiree’s personal pension plays no role in the coverage ratio. Pension and portfolio matter there only as credit and reserve support.
One note on classification. Credit to buy a non-owner-occupied rental is generally treated as business purpose, so these loans are reviewed differently from a standard owner-occupied mortgage, as the CFPB’s commentary on Regulation Z scope describes. Purpose can change if the money goes to personal use. Doss Law’s business purpose guide gives the example of a rental cash-out used to pay personal taxes, which is treated as consumer credit. A loan on a principal residence or second home is a consumer mortgage, and TRID disclosures apply.
Tax treatment varies by borrower and use of funds, so consult a qualified professional.
Borrow Against Assets or Pay Cash?
Selling investments to buy a home triggers a decision about what stays invested. A retiree who borrows keeps the portfolio working and the pension untouched. A retiree who pays cash avoids a loan altogether.
The qualifier path suits a retiree who wants to keep the portfolio intact. The balances are counted, not liquidated, though the lender reviews them and the funds must stay in place through seasoning. Here is the catch: a file that is reviewed on assets is also telling you how much of the portfolio is tied up in the qualification. Retirees should size that against their own cash needs.
What Changes for a Virginia Borrower?
Program figures do not change by state. The percentages, seasoning rules and loan amounts above are the same in Virginia. Lendmire is a broker placing asset-based files through select lenders in its network, and its consumer mortgage lending covers Virginia among 16 states.
State facts such as local prices, insurance and property taxes are context for the budget. They are not program parameters. A retiree in Northern Virginia and one in Hampton Roads face different purchase prices, but the same asset math applies to both.
Lendmire has related coverage if you are still deciding which path fits.
Key Terms Defined
- Asset qualifier: a path where eligible assets, after credit percentages, must equal or exceed the whole loan, with no income documented.
- Asset depletion: a path that divides usable assets by 60 months to create monthly qualifying income.
- Haircut: the share of an account’s balance a lender discounts before counting it.
- Debt-to-income ratio: monthly debts, including the new housing payment, compared with monthly qualifying income.
- Seasoning: the length of time funds must sit in an account, shown by statements.
- Business purpose: a loan used to buy or maintain rental property rather than for personal use.
Common Mistakes
- Assuming the pension is required. On the qualifier path it is not.
- Counting a retirement account at full value. Under 59½, the qualifier path counts it at 90%, and the depletion path counts it at 70% at any age.
- Treating no income documentation as no documentation. Assets are documented on both paths, and the file is fully underwritten.
- Mixing the tables. Leverage and credit percentages belong to one path, never both.
- Moving money right before applying. Fresh transfers fail the seasoning test.
- Treating the ceilings as offers. The figures here are maximums, and each file is priced and underwritten individually.
Who This Does Not Fit
A retiree with modest savings and a large pension may fit a standard income-based loan better. Someone with substantial balances held mostly in crypto, collectibles or business accounts may need time to convert them to seasoned cash first. A borrower under the credit floor or with multiple bankruptcies is outside the program. And a retiree who wants a pure rental with no personal cash-out should compare rental-income programs against the depletion path’s lower investment-property leverage.
Documents to Gather
1. Photo ID and the property or purchase contract details.
2. Two months of statements for each account on the qualifier path, or statements 120 days old plus one within 45 days on the depletion path.
3. A military retirement pay statement or award letter, if the pension is part of the file.
4. A source trail for any large recent deposit.
5. An entity document set, if the loan will close in an LLC on an investment property, subject to program terms.
Frequently Asked Questions
Can a military pension alone qualify me without assets?
Not through these programs. The qualifier path rests on assets alone, and the depletion path requires qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. Where the depletion path is the only income source, liquid assets never fall below $250,000. A pension-only borrower belongs in an income-based lane.
Does my Thrift Savings Plan balance count?
Typically it is reviewed as a retirement account. On the qualifier path it counts at 90% under 59½ and 100% at 59½ or older. On the depletion path it counts at 70% at any age. The lender confirms the account type.
Can I use both paths on one loan?
No. A borrower is reviewed on one path at a time. Pick the one that matches your balances and whether you want the pension in the file.
Does VA disability pay count?
It depends on the program and the lender. Documented income supplements asset income on the depletion path, but which payments count is set lender by lender. Ask before building a plan around it.
Do I have to sell my investments?
No. Balances are counted and documented, not liquidated, though the funds must stay seasoned in the account. Cryptocurrency, precious metals and collectibles are the exception because they are not published as eligible, so they would need conversion to a seasoned cash balance first.
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.
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. Military.com, VA occupancy requirement
2. CFPB Regulation Z § 1026.3 commentary
3. 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: How to Document a Virginia Asset Qualifier Mortgage Without an Employer · How Much Does a Retiring Physician Need in Assets to Qualify for a Mortgage? · Can a Tennessee Divorce Settlement Count as Assets for a Mortgage?
Guides: Asset-Based Mortgage in Virginia
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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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.