The Quick Read: Yes, through select asset-based programs, an IRA balance can count toward a mortgage without any withdrawal, because the lender documents the account with statements and values it at a set percentage instead of liquidating it. Program rules do not change by state, so a Washington borrower sees the same figures as anyone else, subject to underwriting.
- On the asset qualifier path, IRA and 401(k) balances count at 90% under age 59½ and 100% at 59½ or older, and eligible assets must cover the entire loan.
- On the asset depletion path, retirement accounts count at 70% at any age, and usable assets divided by 60 months become qualifying income.
- Leverage on the qualifier path runs up to 80% on a purchase and 75% on a refinance, through select programs.
- Statements are required on both paths. No traditional personal-income documentation, pay stubs or employment verification are needed on the qualifier path, but every file is fully underwritten.
- The IRA is counted, never pledged. Pledging it as security for a loan is a prohibited transaction.
Washington buyers with large retirement balances and light documented income are the usual fit. The rest of this piece covers which path to pick, how the balance is valued, what the underwriter checks, and where files stall. Lendmire is a broker. It places these loans through select lenders in its wholesale network, and each lender underwrites its own file.
Can IRA Assets Qualify Without Withdrawals?
Yes. The lender looks at the account, not at a distribution. You hand over custodian statements showing ownership and access, the lender applies a percentage to the balance, and that adjusted number is what counts. Nothing is sold. Nothing is taxed.
Two terms matter here. A balance is counted when a lender credits it toward qualifying. A balance is withdrawn when money actually leaves the account. Qualifying only needs the first. Cash to close is different, and that comes up below.
The asset-based mortgage programs Lendmire arranges are consumer mortgages on a principal residence or second home. Investment property is available only on the asset depletion path, where the loan is business-purpose.
Two Ways Lenders Use the IRA
The two paths answer different questions, and a borrower is qualified on one path at a time. Blending them is a common source of confusion.
| Factor | Asset qualifier | Asset depletion |
|---|---|---|
| Core test | Assets cover the whole loan | Assets become monthly income |
| Income documented | None | Derived from assets |
| IRA credit | 90% under 59½, 100% at 59½+ | 70% at any age |
| Purchase leverage | Up to 80% | Up to 80% (65% investment) |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
Which fits you? If your eligible assets, after the percentages, equal or exceed the full loan amount, the qualifier path is cleaner. The file rests on assets alone. If your assets are large but fall short of the loan, or you want to buy an investment property, the depletion path turns them into income that has to carry the housing payment and other debts through the debt-to-income test.
Across the wholesale network, the qualifier path tends to suit someone who is cash-heavy and wants the simplest file. The depletion path suits someone who wants more purchasing power from the same balance and has the debt-to-income room.
How the IRA Balance Is Counted
The percentage depends on the path, and sometimes on age. Name the path every time you read a figure.
| Asset | Qualifier path | Depletion path |
|---|---|---|
| Brokerage | 100% | 80% (securities) |
| Savings, money market | 100% | 100% (cash) |
| Certificates of deposit | 100% | 100% |
| IRA or 401(k) | 90% under 59½, 100% at 59½+ | 70% at any age |
The haircut exists because retirement money carries taxes and sometimes early-withdrawal penalties if it were ever drawn. On the depletion path, real-estate equity counts at 60% and private stock at 75%. Not eligible there: 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 to convert them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
A Worked Example
Say a Washington buyer wants an $800,000 loan on the qualifier path. The accounts: $330,000 in brokerage (100% counts, so $330,000), $300,000 in a 401(k) while under 59½ (90% counts, so $270,000), and $200,000 in savings (100%, so $200,000). Usable assets total $800,000, which equals the loan, so the file is reviewed on assets alone, subject to underwriting.
Now the depletion shape. Take $1,500,000 in securities (80% counts, so $1,200,000) plus $300,000 in cash (100%). Usable assets are $1,500,000. Divide by 60 months and you get $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the debt-to-income test.
These numbers are illustrations. The lender’s own calculation governs.
What the Underwriter Verifies When No Money Moves
The lender does not need a transfer. It needs proof the money is yours, available, and old enough.
1. Ownership. The account is in the borrower’s own name. Joint, inherited or restricted accounts may not count.
2. Access. The borrower can reach the funds. Statements should show vesting and access.
3. Seasoning. On the qualifier path: 60 days of seasoning and two months of statements for each qualifying account. On the depletion path: 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.
4. Credit. The qualifier path has a 600 minimum score. The depletion path follows the lender’s matrix, and a first-time investor there needs 700. Housing history is 0x30x12, with one 30-day late in the last twelve months considered case by case.
5. Minimums on depletion. Qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan, and never below $250,000 liquid when assets are the only income source.
A credit check still happens. Assets reduce the documentation, not the underwriting.
The IRA Is Counted, Not Pledged
Borrowers sometimes assume the IRA can be collateral. It cannot. The IRS says a prohibited transaction in an IRA is generally any improper use of the account by the owner, a beneficiary or a disqualified person, and its examples include using the IRA as security for a loan. Asset programs avoid this because they count the balance on paper and never pledge it.
The consequences for crossing the line are real. A disqualified person who takes part must pay a tax, and the account itself can lose IRA status. That is why a lender documenting the balance is a different thing from an IRA taking on debt.
IRA as the Buyer: A Different Structure
An asset-based consumer mortgage to you personally is not the same as a self-directed IRA buying property. The Retirement Industry Trust Association lists transfer to, or use by or for the benefit of, a disqualified person of an IRA’s income or assets as prohibited. A custodian, Madison Trust, says a personal guarantee gives a personal benefit, so loans to an IRA must be non-recourse.
Most mortgage files are written to an individual or an LLC with a personal guarantee. That structure does not fit an IRA as borrower. Treat it as a general caution, and confirm any IRA-owned purchase with your custodian before a lender gets involved.
Do Not Double-Count the Same Dollars
This trips up more files than it should. A dollar of IRA balance used to qualify cannot also be the down payment or reserves. Down payment, closing costs and any reserves are separate buckets.
Here is the catch. If you need actual cash to close from the IRA, that portion is a withdrawal, with whatever tax and penalty follows. Counting the balance for qualifying costs nothing. Spending it does. Many borrowers cover cash to close from brokerage or savings and leave the IRA untouched as qualifying assets.
Reserves are minimal on the qualifier path: none required at or below 75% loan-to-value, and above that the lender sets them. The depletion path has no published reserve months.
IRA Types and Edge Cases
- Traditional and Roth. Both are retirement accounts and take the same percentages in the tables above. Treat tax differences as a separate question for a tax professional.
- Under 59½. On the qualifier path the credit drops to 90%. On the depletion path it stays at 70% regardless of age.
- Inherited and joint accounts. These may not count, because access and sole ownership are in question.
- Self-directed IRA holding real estate or private assets. Illiquid holdings are not a statement balance. Expect the lender to want liquid, documented value.
- Married borrowers. Whose name is on the account matters. Washington is a community property state, but this piece makes no claim that it changes program rules. Confirm account ownership with your lender and counsel.
The Temporary-Distribution Workaround
Some borrowers take a temporary IRA distribution to show income on paper. It is rarely needed under an asset-based program, since the balance counts without a distribution. It can also create tax events and rollover timing risk. Skip it unless a specific lender file requires it.
What Is Different for a Washington Buyer
Not the program. The percentages, seasoning, leverage and loan limits are the same here as anywhere. Washington is one of the 16 states where Lendmire’s consumer mortgage lending is licensed. State facts such as taxes, insurance and local prices affect the purchase itself, not these program parameters. Tax treatment varies; consult a qualified professional.
Mistakes That Stall Files
- Moving money between custodians mid-file, which resets seasoning and creates unexplained activity.
- Rolling over an account during the statement window.
- Large unexplained deposits that need sourcing.
- Counting the same dollars for qualifying and for the down payment.
- Assuming crypto or collectibles count as is.
- Letting statements age past the 120-day and 45-day windows on the depletion path.
A clean file needs stable, recent statements and one clear story about where the money sits.
When Another Route Fits Better
If you document income with business deposits, a bank statement program is the better match, since it is built for borrowers who show income through deposits. If the purchase is a pure rental and the property’s rent carries the payment, DSCR financing is the business-purpose route. Select DSCR lenders in the network do offer programs below 1.00 coverage, but leverage and terms adjust. Asset-based qualification suits the borrower whose strength is the balance sheet.
Key Terms Defined
- Asset qualifier path: drives lender review when eligible assets cover the entire loan amount.
- Asset depletion path: converts usable assets, divided by 60 months, into monthly qualifying income.
- Haircut: the percentage of a balance a lender does not count.
- Seasoning: how long funds have sat in an account before the lender credits them.
- Prohibited transaction: an improper use of an IRA by its owner or a disqualified person.
Frequently Asked Questions
Do I have to withdraw from my IRA to qualify?
No. The lender documents the balance with custodian statements and counts a percentage of it. A withdrawal happens only if you choose to use IRA money for cash to close.
Do I have to be retired or over 59½?
No. Under 59½, an IRA counts at 90% on the qualifier path. On the depletion path, retirement accounts count at 70% at any age.
Can I use the IRA for the down payment as well?
Not the same dollars. A balance used to qualify cannot also fund the down payment or reserves, and money actually taken out is a withdrawal with possible tax consequences.
How many statements will I need?
On the qualifier path, 60 days of seasoning and two months of statements per qualifying account. On the depletion path, statements at least 120 days old plus one within 45 days.
Does Washington change any of this?
No program figure changes by state.
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 programs based on your statements, the property, credit profile, leverage, and your goals. Program terms are subject to underwriting and are not a commitment to lend.
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. IRS – Retirement topics: Prohibited transactions
2. RITA – Prohibited Transactions 101
3. Madison Trust – Prohibited transactions
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 Much Does a Startup Founder Need in Assets to Qualify for a Mortgage? · Can a Texas Widow Qualify for a Mortgage on Life Insurance and Retirement Assets? · Can a Florida Buyer Qualify for a Mortgage on IRA Assets Without Withdrawals?
Guides: Asset-Based Mortgage in Washington
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Compliance and disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage broker and is not a direct lender, depository institution, financial advisor, or tax professional. Content in this article is general market analysis and educational information — not financial, legal, or tax advice for any specific situation. Lendmire does not guarantee loan approval; every transaction is subject to underwriting by the funding lender. Mortgage pricing and loan program guidelines are subject to change at any time without notice and vary by borrower characteristics, property type, and state regulations. Lendmire complies with Equal Housing Opportunity. Licensure verification: NMLS Consumer Access.