The Quick Read: An asset-based cash-out refinance is reviewed around documented assets rather than pay stubs and tax returns, so you disclose the accounts you are counting, fully and accurately, plus your debts and the property. Cash-out is limited to 60% loan-to-value on the asset depletion path, and the asset qualifier path sets cash-out terms lender by lender, subject to underwriting.
- Two paths exist, and you are qualified on one at a time. The asset qualifier path covers the entire loan with eligible assets. The asset depletion path turns assets into monthly income.
- You list the accounts you want counted, with statements. You do not need to volunteer accounts you are not relying on.
- Cash you pull out at closing never counts as a qualifying asset.
- Privately held company stock is not an eligible asset on either path.
- You still get underwritten. The file skips traditional personal-income documentation, such as pay stubs and employment verification, but it does not skip documentation altogether.
What “Asset-Based” Means in a Cash-Out Refinance
Asset-based means the lender looks at what you own instead of what you earn. A cash-out refinance replaces your current mortgage with a larger one and pays you the difference. The loan is a normal, fully underwritten mortgage. Only the proof of repayment ability changes.
Through the wholesale network Lendmire works with, two paths cover this. On the asset qualifier path, your eligible assets, after the credit percentages, must equal or exceed the entire loan. No employment or income is documented. On the asset depletion path, your eligible assets, after haircuts, are divided by 60 months. The result is a monthly qualifying income, and it must carry the housing payment and other debts through the debt-to-income test.
Think of it as two different answers to one question. The qualifier path says you could pay off the loan from what you hold. The depletion path says your portfolio throws off enough monthly income to carry the payment. Lendmire’s asset-based mortgage programs place both through select lenders, subject to underwriting.
Which Path Fits You
Pick the qualifier path if your eligible assets are as large as the whole loan. Pick the depletion path if they are not, or if you want cash-out on a larger balance sheet, an investment property, or a loan the qualifier path does not cover.
Retirees living on a portfolio often fit the depletion path. So do people who sold a business, received an inheritance or settlement, or retired early. Their balances are large and their documented income is small.
The qualifier path is built for a principal residence or second home. Investment property is available only on the depletion path. There, the loan is business-purpose, which changes a few details covered below.
Asset-Based Cash-Out Refinance Requirements at a Glance
The figures below are typical ceilings and floors through select programs, subject to underwriting. They are not offers.
| Item | Asset qualifier path | Asset depletion path |
|---|---|---|
| How assets are used | Cover the whole loan | Divided by 60 months |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Refinance leverage | Up to 75% | 80% rate-and-term (primary, second) |
| Cash-out leverage | Set by lender, not published | 60% (primary, second, investment) |
| Investment property | Not available | 65% purchase or rate-and-term |
| Credit score | 600 minimum | Lender’s matrix |
| Statements | Two months per account | Aged 120+ days, plus one within 45 |
| Reserves | None at or below 75% LTV | No published months |
Two details deserve attention. On the qualifier path, a cash-out figure is not published, so any number you see for it elsewhere is not a program fact. On the depletion path, cash-out is 60% whether the property is your home, a second home or a rental.
Credit rules apply on top. Housing history is typically 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible. On the depletion path, a housing event needs four years of seasoning. A first-time investor on that path needs a 700 score.
How Each Asset Counts
Assets do not count dollar for dollar. Each type carries a credit percentage.
| Asset type | Qualifier path | Depletion path |
|---|---|---|
| Brokerage / securities | 100% | 80% |
| Certificates of deposit | 100% | 100% |
| Money market, savings, cash accounts | 100% | 100% |
| Retirement accounts | 90% under 59½; 100% at 59½+ | 70% at any age |
| Real-estate equity | Not listed | 60% |
On the qualifier path, accounts combine. Add up the credited balances and compare the total to the loan.
Some assets are not eligible on the depletion path at all: 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, business accounts beyond your ownership share, and pledged or borrowed funds are not published as eligible on either path. The route for all of these is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
Where Cash-Out Fits on Each Path
Your purpose for the loan decides which path works. A cash-out refinance means you take home money beyond the payoff. A rate-and-term refinance does not.
On the depletion path, cash-out sits at 60% loan-to-value, well below the 80% allowed on a rate-and-term refinance of a primary residence or second home. That gap is the cost of taking equity out. On an investment property, the rate-and-term ceiling is 65%, and cash-out stays at 60%.
On the qualifier path, a refinance goes up to 75%. Whether proceeds can come out, and at what leverage, depends on the lender. Ask before you build a plan around it.
Paying off a home equity line or a short-term loan is its own gray area. Whether a payoff counts as cash-out or rate-and-term depends on how much cash lands in your hands at closing. Programs differ on that threshold, so raise it early.
One rule is firm. Cash-out proceeds never count as qualifying assets. You cannot borrow money and then use it to prove you can borrow.
How Much Asset Information to Disclose
Disclose the accounts you are counting, in full, plus anything the lender needs to understand them. You choose which assets to rely on. You do not choose to leave out debts, ownership or the truth about where money came from.
Think of it in tiers, laid out below.
Tier 1: you must provide.
- Complete statements for every account you want counted, with all pages. On the qualifier path that means two months per account. On the depletion path it means statements at least 120 days old plus the most recent one within 45 days.
- Documentation of the property and your current mortgage.
- Your liabilities and credit authorization.
- An explanation and paper trail for large or unusual deposits.
Tier 2: the lender may ask.
- Proof of who owns an account and your share of it.
- The source of recent deposits or transfers.
- Account-opening or conversion records when you sold or liquidated something to build the balance.
- Letters or records tying an inheritance, settlement or business sale to its funds.
Tier 3: not needed.
- Accounts you are not counting toward the qualifying total.
- Statements from accounts on the ineligible list, unless you are explaining where money came from.
Here is the tradeoff. Every account you list invites questions about its history. Listing accounts you do not need adds paperwork, not approval strength. If your eligible balances clear the bar with room to spare, stop there.
Do not go the other way and understate. Leaving a debt off the application is a misstatement. So is calling borrowed funds your own. Choosing not to count an account is fine. Hiding a liability is not.
Seasoning, Statements and Large Deposits
Seasoning is how long money has sat in your account. Lenders want to know the money is yours and was not just moved in.
The qualifier path asks for 60 days of seasoning and two months of statements per account. The depletion path wants 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 depletion-path seasoning. The paperwork still has to show where they came from.
If you moved money between your own accounts, keep both sides of the transfer. If a large deposit came from a sale, keep the closing statement. Build that trail before you apply. It is dull work, and it prevents the questions that stall files.
Reserves, Proceeds and Counting Money Twice
Reserves are liquid funds left after closing. On the qualifier path, none are required at or below 75% loan-to-value, and above that the lender sets them. The depletion path publishes no reserve months.
Each dollar can do one job. If you count a brokerage account toward the qualifier-path total, you cannot also treat it as spare reserves or as money for another purchase. On the depletion path, assets that generate qualifying income are already working, so plan your leftover liquidity separately.
The depletion path adds minimums. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. If assets are your only income source, you also need at least $250,000 liquid. Asset-derived income can also supplement documented income up to a 45% debt-to-income ratio, and when it supplements, the minimum-assets rule is waived.
When the Property Is an Investment
An investment property is eligible only on the asset depletion path, and the loan is business-purpose. Business-purpose credit is treated differently from a consumer mortgage. The CFPB’s Truth in Lending exam procedures treat credit to acquire or improve non-owner-occupied rental property as business-purpose. The exemption turns on occupancy, the loan’s purpose and the unit count, as Compliance Alliance’s review of investment property under Regulation Z explains.
In practice, that means purpose is a facts question. If you plan to move in, the loan is not a rental loan. Say what you plan honestly.
Tax treatment varies; consult a qualified professional before relying on any deduction.
Edge Cases Where the General Rule Breaks
Privately held company stock. It is not an eligible asset on either path. A founder’s route is documented liquid assets: seasoned proceeds from a sale or conversion, cash, public securities and retirement accounts at their haircuts.
Crypto and other alternative holdings. They are not published as eligible. Convert them to a seasoned cash balance in a regulated account, and expect the lender to review the source.
Retirement accounts. The qualifier path credits 90% under 59½ and 100% after. The depletion path credits 70% at any age. Same account, different value.
Borrower with big assets but a thin credit file. Assets do not override credit. The qualifier path has a 600 floor. The depletion path follows the lender’s matrix. Subject to underwriting, a weak file can still be declined.
Business-purpose does not mean unregulated. Hunton’s analysis of business-purpose lending notes that a guarantor or co-signer can trigger other consumer-protection laws. Do not assume a rental label ends every review.
Two Worked Examples
These illustrate the arithmetic. The lender’s own calculation governs.
Asset qualifier path. Say the loan is $800,000. You hold $330,000 in brokerage accounts, which count at 100%, so $330,000. You hold $300,000 in a 401(k) and you are under 59½, so 90% counts, which is $270,000. You hold $200,000 in savings, counted at 100%, so $200,000. Together that is $800,000 of usable assets, enough to qualify on assets alone.
Asset depletion path. Say you hold $1,500,000 in securities, which count at 80%, so $1,200,000. You also hold $300,000 in cash, counted at 100%. Usable assets total $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.
The same person can see very different numbers on each path. Which one fits depends on how big the loan is relative to your assets, and whether the debt-to-income test is easier than covering the loan outright.
Pre-Application Checklist
- Decide which path you are using.
- List the accounts you intend to count, and drop the rest.
- Pull complete statements for each, with every page.
- Check that account balances are old enough for the seasoning rule.
- Trace large deposits to a source and keep the paperwork.
- Convert any ineligible holding to a seasoned cash balance if you plan to use it.
- Gather your mortgage statement, property details and a list of liabilities.
- Check your credit and housing history against the floors above.
Common Mistakes
Counting borrowed or pledged funds as your own. Using cash-out proceeds as qualifying assets. Mixing the two paths’ percentages in one calculation. Showing statements with missing pages. Leaving a debt off the application. Listing every account in sight, then spending weeks explaining the ones that never mattered.
Another mistake is assuming the program is easier than a conventional loan. Documentation is lighter in some places. Leverage is often tighter, and the file is still fully underwritten.
Key Terms Defined
Asset qualifier path: the route where eligible assets, after credit percentages, equal or exceed the whole loan.
Asset depletion path: the route where eligible assets, after haircuts, are divided by 60 months into a qualifying monthly income.
Haircut: the percentage of an asset’s balance that does not count toward qualifying.
Seasoning: how long funds must have sat in your account before they count.
Cash-out refinance: a new, larger mortgage that pays off the old one and gives you the difference.
Loan-to-value (LTV): the loan amount divided by the property’s value.
Debt-to-income (DTI): your monthly debts divided by your monthly qualifying income.
Frequently Asked Questions
Do I have to list every account I own?
No. List the accounts you want counted and the debts and property facts the application asks about. Extra accounts add questions about sourcing without adding approval strength. Anything you do list must be accurate and complete.
Does privately held company stock count?
No. Privately held company stock is not an eligible asset on either path. Your documented route is a sale or buyout converted into a seasoned cash balance, plus any cash, public securities and retirement accounts you hold.
Can I count my IRA or 401(k)?
Yes, with a haircut. On the qualifier path, retirement balances count at 90% under 59½ and 100% at 59½ or older. On the depletion path, they count at 70% at any age. All of it is subject to underwriting.
Can the cash I take out count toward my assets?
No. Cash-out proceeds never count as qualifying assets. You must qualify on assets you already hold and have documented.
Does asset-based mean no documentation?
No. It means no traditional personal-income documentation, pay stubs or employment verification. Your assets, credit, liabilities and the property are all documented and reviewed. The program is available through select lenders in Lendmire’s network, which is licensed for consumer mortgage lending in 16 states.
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.
For how equity extraction works on an investment property, see Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage brokerage serving self-employed and high-net-worth borrowers in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages are arranged through wholesale lending channels; Lendmire brokers the financing and the lender underwrites each application. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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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 – Truth in Lending Act exam procedures (Reg Z exempt transactions)
2. Compliance Alliance – Regulation Z and “Investment” Properties
3. Hunton – Beware of “Business Purpose”
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 Wire From a Sale Before an Asset-Based Mortgage · Can You Cash Out a Texas Home on an Asset Depletion Refinance? · Can You Get a Texas Asset-Based Mortgage With No Job?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.