The Quick Read: The best program for your situation depends on whether your assets cover the loan outright or can be converted into qualifying income, because each path carries different leverage, asset credit and cash-out rules. Both skip traditional personal-income documentation, pay stubs and employment verification. Neither skips credit, property review or asset documentation, and every file is fully underwritten.
- Asset qualifier path: eligible assets must equal or exceed the entire loan, and no employment or income is documented.
- Asset depletion path: usable assets are divided by 60 months into monthly qualifying income, which then runs through the debt-to-income test.
- Cash-out leverage is clearest on the depletion path: 60% on a principal residence, second home or investment property, subject to underwriting.
- Cash-out proceeds never count as qualifying assets on the depletion path.
- Privately held company stock is not eligible on either path.
What Does “Best” Mean for This Kind of Loan?
No single program wins for every borrower. The best fit depends on five things:
1. How large your liquid balances are compared with the loan.
2. Which kinds of accounts hold them.
3. Whether the property is a home or a rental.
4. How much cash you need out of the equity.
5. Your credit profile.
Lendmire is a mortgage broker, not a lender. It places files with select lenders in its wholesale network and matches the scenario to the program. The asset-based mortgage programs it arranges are consumer mortgages on a principal residence or second home. Investment property is available only on the depletion path. All figures here are ceilings and floors, not offers, and they are subject to underwriting and the lender’s own calculation.
What Are the Three Meanings of “Asset-Based”?
The phrase means three different things in this market. Mixing them up is how borrowers end up in the wrong conversation.
| Meaning | What drives lender review | Typical collateral |
|---|---|---|
| Borrower-asset programs | Your liquid balances | Home, second home, some investment |
| Rental-income (DSCR) loans | Property rent covering the payment | Non-owner-occupied rentals |
| Hard money | The property’s value | Any, short-term |
This article covers the first row. Rental-income financing qualifies primarily on property-level rent covering the payment, subject to lender guidelines. It is a separate product. Hard money is short-term property-based lending.
A bank statement program is also different. It is built for borrowers who document income through deposits, not for borrowers qualifying on balances.
How Does the Asset Qualifier Path Work?
The qualifier path asks one question: do your eligible assets cover the whole loan? If they do, no employment or income is documented. The lender’s ability-to-repay review rests on the assets.
Key figures, subject to underwriting:
- Leverage: up to 80% loan-to-value (LTV) on a purchase and 75% on a refinance, for a principal residence or second home.
- Loan size: up to $4,000,000.
- Credit: 600 minimum score. Approval is never promised.
- Seasoning: 60 days, with two months of statements for each qualifying account.
- Reserves: none required at or below 75% LTV. Above that, the lender sets them. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
Whether cash-out proceeds are allowed on this path, and at what leverage, is set by the lender and is not published. If cash-out is your goal, the broker’s job is to put your exact scenario in front of the lenders that write it. Do not assume a number.
How Does the Asset Depletion Path Work?
Depletion turns your assets into income. The lender takes your usable assets, divides by 60 months, and treats the result as monthly income. That income must carry the housing payment and your other debts through the debt-to-income test.
This is the path that clearly supports cash-out. It also reaches investment property.
| Depletion path (subject to underwriting) | Purchase or rate-and-term | Cash-out |
|---|---|---|
| Principal residence or second home | Up to 80% | Up to 60% |
| Investment property | Up to 65% | Up to 60% |
Loan amounts run from $125,000 to $3,500,000. Other requirements:
- Minimum assets: the lesser of $1,000,000 or 1.25 times the loan balance. When assets are the only income source, you also need at least $250,000 in liquid funds.
- 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.
- Credit: the lender’s score and loan-amount matrix applies. A first-time investor needs a 700 score. Housing history is 0x30x12, and a housing event needs 4 years of seasoning.
- Supplemental income: asset-derived income can supplement documented income up to a 45% debt-to-income ratio. When it does, the minimum-assets rule is waived.
Which Assets Count, and How Much?
The percentage of each asset that counts varies by path. Never blend the two columns.
| Asset type | Qualifier path | Depletion path |
|---|---|---|
| Cash, savings, money market | 100% | 100% (cash accounts) |
| Certificates of deposit | 100% | 100% |
| Brokerage accounts / securities | 100% | 80% |
| Retirement accounts | 90% under 59½, 100% at 59½+ | 70% at any age |
| Real-estate equity | Not published | 60% |
Qualifier-path accounts combine. Real-estate equity counts only on the depletion path.
Privately held company stock is not an eligible asset on either path. A founder or shareholder qualifies by converting that wealth into documented liquid assets. Seasoned proceeds from a sale or buyout, cash, public securities and retirement accounts all count at their own percentages.
Cryptocurrency, precious metals, collectibles, pledged or borrowed funds, and business accounts beyond your ownership share are not published as eligible on either path. The route is converting them to a seasoned cash balance in a regulated account. The lender reviews the source of those funds.
The depletion path also excludes 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.
Can the Cash You Pull Out Count Toward Qualifying?
No. On the depletion path, cash-out proceeds never count as qualifying assets. You cannot refinance, park the cash in an account, and use it to qualify for the same loan.
Plan around the balances you hold before closing. Then size the cash-out to what you need, not to what the ceiling allows.
What Do the Numbers Look Like?
These shapes are illustrative. The lender’s own calculation governs.
Qualifier path. Picture a refinance with an $800,000 loan. The borrower holds $330,000 in brokerage accounts (100% counts, so $330,000). A 401(k) holds $300,000 and the borrower is under 59½ (90% counts, so $270,000). Savings add $200,000 (100%, so $200,000). Usable assets total $800,000, which equals the loan, so 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%, so $300,000). Usable assets are $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 debt-to-income test.
Qualifying income is only one gate. The cash-out ceiling, 60% on this path, caps the loan on the property side.
Which Path Fits Which Borrower?
| Your situation | Likely fit |
|---|---|
| Balances cover the whole loan, and the property is a home | Asset qualifier path |
| Balances are large but smaller than the loan | Asset depletion path |
| You need cash-out on a home | Depletion path (60%) |
| You own an investment property and want cash-out | Depletion path (60%) |
| Your wealth is mostly private company stock | Convert to liquid assets first |
| You have some documented income and large balances | Depletion supplementing income |
This fits retirees, business sellers, recipients of an inheritance or settlement, early-retired professionals and households living on a portfolio. Their balances are large and their documented income is not.
What Do You Still Have to Document?
Skipping income documents is not the same as skipping documents. Expect to provide:
- Statements for every qualifying account, within the seasoning rules above.
- A credit report and housing history.
- An appraisal of the property.
- Title and payoff information for the existing loan.
- Source records for any large recent deposit.
The program documents your assets with statements. It does not use tax returns, pay stubs or employment verification.
Where the General Rule Breaks
Investment property changes the product. Only the depletion path reaches it, with lower leverage. Credit to acquire, improve or maintain a non-owner-occupied rental is deemed business purpose under Regulation Z’s business-purpose rule. An owner-occupied property is treated differently. Acquisition credit counts as business purpose only above two units, and improvement or maintenance credit only above four.
Business purpose is not a free pass. A law-firm analysis of business-purpose lending cautions that the label does not mean compliance-exempt. It also notes that some states require licensure for loans secured by residential property whatever the purpose. This program’s footprint is 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington.
A first-time investor needs more. The depletion path requires a 700 score for a first-time investor.
Past housing events slow the file. A foreclosure or similar housing event needs 4 years of seasoning on the depletion path, and multiple bankruptcies are not eligible.
A rental owner may prefer rent-based financing. If your goal is to pull equity from a rental and your income is light, rent-based financing may fit better than asset-based. Rental-income loans qualify primarily on property-level rent covering the payment, subject to lender guidelines. Programs below 1.00 coverage are available through select lenders in the network, but LTV and terms adjust.
Key Terms Defined
Asset qualifier path: a path where eligible assets, after credit percentages, equal or exceed the entire loan amount.
Asset depletion path: a path that divides usable assets by 60 months to create monthly qualifying income.
Seasoning: the length of time funds have sat in your account before the lender will count them.
Haircut: the share of an asset’s balance the lender discounts because the asset is less liquid.
Cash-out refinance: a new loan that pays off the old one and returns the leftover equity to you as cash.
Debt-to-income (DTI) ratio: your monthly debts, including the new housing payment, compared with your monthly qualifying income.
Frequently Asked Questions
Do I need tax returns for an asset-based cash-out refinance?
No. Neither path uses tax returns, pay stubs or employment verification. The lender instead documents your assets with statements, reviews your credit and values the property. Every file is fully underwritten, subject to lender guidelines.
Can I use a retirement account without paying to withdraw it?
Yes, the balance counts toward qualifying without being liquidated. On the qualifier path, a 401(k) or IRA counts at 90% under age 59½ and 100% at 59½ or older. On the depletion path, retirement accounts count at 70% at any age.
Does investment property qualify?
Only on the asset depletion path. Leverage is up to 65% on a purchase or rate-and-term refinance and up to 60% on a cash-out, subject to underwriting. The loan is business-purpose, and a first-time investor needs a 700 credit score. Leverage, reserves, and pricing vary by lender and program; the final terms follow the full file review.
What if most of my wealth is a private company?
After a sale or buyout, the proceeds can count once they are converted to a seasoned cash balance. Public securities and retirement accounts count at their own percentages.
How do I find the best program for my situation?
Start with your statements, the property type, your credit profile and how much cash you need. Lendmire shops multiple wholesale lenders and matches the scenario to the path. The best fit changes with those inputs, so a single quoted program is rarely the full picture.
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. Programs are subject to underwriting, and nothing here is a commitment to lend.
For the mechanics of pulling equity out of a rental 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, Regulation Z §1026.3 (business-purpose exemption)
2. Hunton Andrews Kurth, 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: Best Asset-Based Cash-Out Refinance Program in Retirement Without a Regular Paycheck · Best Asset-Based Cash-Out Refinance Program for Retirees Living on Fixed Income · Best Asset-Based Cash-Out Refinance Program for a Founder Before a Liquidity Event
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.