The Quick Read: For a retiree whose wealth sits in brokerage, savings and retirement accounts, the right program depends on one question: do your assets cover the whole loan, or do they need to become monthly income? Through select programs, the asset qualifier path does the first, and the asset depletion path does the second, subject to underwriting. On a cash-out refinance, the depletion path tops out at 60% loan-to-value, whether the collateral is a principal residence, a second home or an investment property.
- Both paths ask for no traditional personal-income documentation, pay stubs or employment verification. Every file is still fully underwritten, and your assets are documented with statements.
- The asset qualifier path counts eligible assets against the entire loan. The asset depletion path divides usable assets by 60 months to create qualifying income.
- Cash-out proceeds never count as qualifying assets on the depletion path, so the money you pull out cannot help you qualify.
- Privately held company stock does not count on either path.
- The best program for your situation depends on your balances, your age, the property and how much cash you want out of it.
What “Asset-Based” Means on a Cash-Out Refinance
An asset-based cash-out refinance lets a lender look at what you own instead of what you earn. You replace your current mortgage with a larger one and keep the difference. The lender checks your investment statements instead of a paycheck.
That matters if you are retired and living off a portfolio. A retiree with millions in brokerage and retirement accounts can show very little taxable income. A conventional underwriter reads that as a weak file. Asset-based programs read it differently.
Lendmire is a mortgage broker, not a lender. It places these files through select lenders in its wholesale network, and those lenders review eligibility and approve. Lendmire’s asset-based mortgage programs are available in 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington.
Every figure below is a ceiling or a floor, not an offer. Programs change, and each file is underwritten on its own facts. A lender’s own calculation always governs.
Two Paths, One at a Time
You qualify on one path at a time. The paths do not blend, and their rules differ, so keep the tables separate in your head.
| Factor | Asset qualifier | Asset depletion |
|---|---|---|
| How assets are used | Cover the entire loan | Become monthly income |
| Income documented | None | Derived from assets |
| Refinance leverage | Up to 75% | Up to 60% on cash-out |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit | 600 minimum | Lender’s matrix |
The asset qualifier path asks whether your eligible assets equal or exceed the whole loan amount. If they do, no employment or income is documented at all. Its leverage runs up to 80% on a purchase and 75% on a refinance. Whether cash-out proceeds are allowed on this path, and at what leverage, is set by each lender and is not published. Ask for that answer on your specific file before you plan around it.
The asset depletion path takes your usable assets, divides them by 60 months and treats the result as income. That income then has to carry your housing payment and other debts through the debt-to-income test. Debt-to-income, or DTI, is your monthly debts divided by your monthly income.
For a cash-out, the depletion path is the one with published numbers. That is why most of this article focuses on it.
How Underwriting Treats a Cash-Out, Step by Step
Here is how a depletion-path cash-out file usually moves, subject to lender guidelines.
1. Pick the property. A principal residence, second home or investment property can all be on the table. Cash-out leverage on the depletion path is up to 60% loan-to-value for all three. A purchase or rate-and-term refinance gets more room: up to 80% on a principal residence or second home, and up to 65% on an investment property.
2. List your accounts. Each account is trimmed by its eligibility percentage. Cash and certificates of deposit count in full, securities at 80%, retirement accounts at 70% and real-estate equity at 60%.
3. Check the minimum. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When assets are your only income source, the figure is never below $250,000 liquid.
4. Divide by 60 months. The result is your monthly qualifying income.
5. Run the DTI test. That income has to carry the new housing payment and your other monthly debts.
6. Review credit and housing history. The lender’s score matrix applies. A history of 0x30x12 is the standard, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible. A housing event such as a foreclosure needs four years of seasoning.
7. Season the assets. Statements must be at least 120 days old at application. You also need one recent statement dated within 45 days. Funds from a business sale, an inheritance or a legal settlement are excused from that seasoning.
A first-time investor on the depletion path needs a 700 score, so a retiree buying a first rental should plan for that. The cash-out proceeds never count as assets in this math. The lender reviews your file on what you already own.
Which of Your Assets Actually Count
Your balances do not count at face value. Each account type gets a percentage, and the percentage differs by path.
On the asset qualifier path, the share of each balance that counts looks like this:
| Asset | Credit toward the loan |
|---|---|
| Brokerage accounts | 100% |
| Certificates of deposit | 100% |
| Money market | 100% |
| Savings | 100% |
| 401(k) and IRA, under 59½ | 90% |
| 401(k) and IRA, 59½ or older | 100% |
Accounts combine, so you can stack several types to reach the loan amount. On the depletion path the haircuts are steeper, as covered above. Retirement accounts count at 70% at any age, which is a real difference for a retiree over 59½. Compare both paths if your money sits mostly in an IRA.
Several assets do not count on the depletion path at all. They are 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.
If you built a business and own it outright, the shares are worth nothing toward the loan. The documented route is a sale or buyout. Once the proceeds land in a regulated cash account and season, that cash counts in full.
Cryptocurrency, precious metals, collectibles, pledged or borrowed funds and business accounts beyond your ownership share are not published as eligible on either path. The same route applies. Convert them into a seasoned cash balance in a regulated account, and the lender reviews the source of those funds.
Two Worked Examples
These shapes show the math. Your numbers will differ, and the lender’s calculation governs.
Asset qualifier path. A borrower seeks an $800,000 loan. She holds $330,000 in brokerage accounts, which count at 100%, or $330,000. She holds $300,000 in a 401(k) while under 59½, which counts at 90%, or $270,000. She holds $200,000 in savings, which count at 100%, or $200,000. Usable assets total $800,000, which equals the loan, so she is reviewed on assets alone, subject to underwriting.
Asset depletion path. A retired couple holds $1,500,000 in securities and $300,000 in cash. The securities count at 80%, which is $1,200,000. The cash counts at 100%, which is $300,000. Usable assets total $1,500,000. Divided by 60 months, that is $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the DTI test.
Notice the depletion couple is not touching their portfolio. They keep their investments invested. That is the appeal of this structure for many retirees. They borrow against the home and leave the portfolio alone.
Where the General Rule Breaks
The mechanics above hold for most files. These cases bend them.
You have a pension or Social Security. Asset-derived income can supplement documented income, up to a 45% DTI. When it supplements, the minimum-assets rule is waived. A retiree with steady income and a mid-sized portfolio may land here.
Your portfolio is below the minimum. If your assets fall short of the lesser of $1,000,000 or 1.25 times the loan, and you have no other income, the depletion path does not work. A smaller loan or a lower leverage request may bring the file back into range.
Your wealth is in a business. Founders and shareholders cannot count private stock. A sale first, a seasoned cash balance second, and then the file can work. Sale-of-business funds are excused from the 120-day statement seasoning on the depletion path.
You own a rental and the rent is strong. If rent comfortably covers the new payment, business-purpose rental financing, known as DSCR, drives lender review on the property’s income instead of yours. Your portfolio then serves as reserves, not income. If rent is thin and your portfolio is large, the depletion path often fits better.
Rentals bring a second layer of rules. Lenders treat loans on non-owner-occupied rental property as business-purpose, which means they are reviewed differently from a standard owner-occupied mortgage. The federal ability-to-repay rule covers loans made primarily for personal, family or household purposes, and the Federal Register notice treats investment-purpose loans as business purpose. A Hunton analysis on Lexology adds that business purpose does not mean exempt from every consumer law.
Occupancy matters too. A Doss Law guide notes that an owner who expects to occupy a property more than 14 days in the coming year can push the loan toward consumer credit. Expect a lender to ask about your intended use of the property and the cash.
You are under 59½. On the qualifier path, your retirement accounts count at 90% instead of 100%. Early retirees should run both versions.
You want proceeds to help you qualify. They cannot on the depletion path. Do not plan a second loan on the strength of cash you just borrowed.
Is the Payment Sustainable on Portfolio Income?
Qualifying and living comfortably are different tests. A cash-out replaces your current mortgage with a larger balance, so the monthly obligation rises. The file may clear underwriting while your household budget tightens.
Stress-test three things before you apply:
- Withdrawals. Can your portfolio fund the new payment plus living costs if markets fall?
- Sequence risk. Pulling money out in a down year hurts more than pulling it out in an up year. A payment you cannot cover without selling in a drop is a risk.
- The use of proceeds. Cash for a home repair or a debt payoff carries a different risk than cash to buy more investments.
Tax treatment can depend on how the funds are used and how the property is held; borrowers should keep clear records and speak with a qualified tax professional before relying on any deduction.
Not every retiree needs a new first mortgage. Here is how the main alternatives differ:
| Option | What changes | Main tradeoff |
|---|---|---|
| Asset-based cash-out | Replaces your first mortgage | Larger balance, new loan terms |
| HELOC | Adds a second lien | Keeps first loan, adds variable draw |
| Reverse mortgage | Age-restricted equity draw | Different rules and repayment terms |
| Portfolio withdrawal | Sells investments | Gives up growth, may trigger a sale |
If you already hold a low-cost first mortgage, replacing it can cost you that advantage.
Key Terms Defined
Asset qualifier path: A program path where your eligible assets, after credit percentages, must equal or exceed the entire loan amount, with no income documented.
Asset depletion path: A program path that divides usable assets by 60 months to create monthly qualifying income, which then runs through the debt-to-income test.
Cash-out refinance: A new mortgage that pays off the old one and gives you the difference in cash.
Debt-to-income ratio (DTI): Your total monthly debts divided by your monthly income.
Seasoning: The time money has sat in your account, shown by statements, before a lender counts it.
Haircut: The share of an account’s value a lender subtracts before counting it, such as 20% off a securities balance.
Business-purpose loan: A loan made to buy or hold a rental or other investment property, reviewed differently from an owner-occupied mortgage.
What to Prepare Before You Apply
A clean file moves through review with fewer questions. Gather these before a broker shops it:
- Statements for every account you want counted, with the right age. The qualifier path wants two months of statements per account and 60 days of seasoning. The depletion path wants one statement within 45 days and the others at least 120 days old.
- Proof of ownership for the property and your current mortgage statement.
- A paper trail for any large recent deposit. Sale, inheritance and settlement funds need documents showing where they came from.
- A credit report you have reviewed. Know your score and housing history before the lender does.
- A clear statement of what you will do with the cash. Lenders review the loan purpose, and rentals carry a business-purpose declaration.
Choosing Among Programs
No single program wins for every retiree. Think of it as a short decision tree.
If your eligible assets equal or exceed the loan, the asset qualifier path is worth a look first, and you should ask about cash-out treatment. If your assets are large but below the loan amount, the depletion path turns them into income. If the property is a rental with strong rent, a DSCR loan may fit better and leave your portfolio untouched. If you have a pension on top of a portfolio, the supplement rule may help.
A broker earns its place here. Different lenders in the network set different overlays, and the best program for your situation depends on your balances, credit profile, property type, leverage need and documents. A broker matches the file to the lender that writes that kind of scenario instead of guessing.
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. You can request a quote or call 828-256-2183.
Frequently Asked Questions
Can a retiree get a cash-out refinance without traditional personal-income documentation or pay stubs?
Yes, through select programs, subject to underwriting. Asset-based loans ask for no traditional personal-income documentation, pay stubs or employment verification. They still require full underwriting, with your assets documented through account statements. Credit, property and leverage are all reviewed.
Do the proceeds from the cash-out count toward my qualifying assets?
No. On the asset depletion path, cash-out proceeds never count as qualifying assets. The program reviews your file on what you owned before the loan. Plan the file around your existing balances, not the money you will receive.
Does my IRA or 401(k) count?
Yes, with a haircut on the depletion path. 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. Taking cash out of the home leaves the account untouched.
What if most of my wealth is stock in my own company?
Privately held company stock is not an eligible asset on either path. The route is a sale or buyout, with the proceeds held as a seasoned cash balance in a regulated account. Business-sale funds are excused from the 120-day seasoning on the depletion path. Public securities and cash you already hold count at their normal percentages.
Can I use this to cash out of a rental property?
Yes, on the depletion path, up to 60% loan-to-value on a cash-out refinance of an investment property, subject to underwriting. A first-time investor needs a 700 score. If the rent comfortably covers the payment, business-purpose DSCR financing is another route worth comparing.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
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. Federal Register: Ability-to-Repay and Qualified Mortgage Standards Under the Truth in Lending Act
2. Hunton via Lexology: Beware of “Business Purpose”
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: Asset-Based Cash-Out Refinance Requirements on a Non-Warrantable Condo · How Much Cash Can a New Mexico Homeowner Take Out on an Asset Depletion Refinance? · Can You Get an Asset-Based Mortgage on a Tennessee Condo?
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.