The Quick Read: The best fit is the program that matches how your money is held: eligible assets that cover the entire loan on the asset qualifier path, or assets converted into monthly qualifying income on the asset depletion path, with the right choice depending on your balances, property, credit, and how much cash you want out. These loans are underwritten individually, and the figures below are ceilings and floors, not offers.
- On the asset qualifier path, eligible assets must equal or exceed the whole loan, and no employment or income is documented.
- On the asset depletion path, usable assets divided by 60 months become qualifying income that runs through the debt-to-income test.
- Published cash-out leverage exists only on the depletion path: 60% on a principal residence, second home, or investment property.
- Going fixed is a structure question as much as a program question, so confirm the fixed-rate option and any prepayment terms before you commit.
- Privately held company stock is not an eligible asset on either path.
Lendmire is a mortgage broker, not a lender. It matches your scenario to select lenders in its network through asset-based mortgage programs. Consumer lending for this program is licensed in 16 states.
Why “Best” Depends on Your Balance Sheet
No single program wins for every borrower. Asset-based lending exists for people whose balances are large and whose documented income is small. Think retirees, people who sold a business, heirs, and households living off a portfolio.
The first decision is which path your assets support. A borrower is qualified on one path at a time, never a blend. The second decision is what you want the cash-out to do. The third is the loan structure you are moving into.
Many borrowers who want to go fixed are leaving something else. It might be an adjustable-rate mortgage, an interest-only loan, a bridge loan, or a home equity line. A home equity line of credit, or HELOC, is a revolving credit line secured by your home, and its payment usually moves. A fixed-rate loan replaces that moving payment with a steady one.
This is where a broker earns its keep. Different lenders in a network set different overlays on the same asset types. The strongest match comes from lining up your statements against those overlays before anyone orders an appraisal.
Key Terms Defined
Cash-out refinance: A new, larger mortgage that pays off the old one and hands you the difference in cash.
Rate-and-term refinance: A new mortgage that replaces the old one without paying you cash back at closing.
Asset qualifier path: The route where eligible assets, after credit percentages, must cover the entire loan amount.
Asset depletion path: The route that divides usable assets by 60 months to create monthly qualifying income.
Seasoning: The length of time money must sit in your accounts, shown by statements, before it counts.
Debt-to-income ratio (DTI): Your monthly debts divided by your monthly income, including the new housing payment.
Haircut: The share of an asset’s balance a lender will not count, to allow for price swings and taxes on withdrawal.
Prepayment penalty: A fee some loans charge if you pay off or refinance early.
How Does Underwriting Treat an Asset-Based Cash-Out?
Every file is fully underwritten. What changes is how income is proven. You provide no traditional personal-income documentation, pay stubs, or employment verification. You do provide statements, because the assets are documented on both paths.
Here is the sequence, step by step.
1. The file is classified. If cash comes back to you at closing, the loan is a cash-out. The CFPB describes a cash-out refinance as a new mortgage that replaces the original one and carries a larger balance. A refinance that only pays off the old loan and costs is rate-and-term.
2. You pick the path. Your assets either cover the whole loan or become income. The lender will not let you mix the two tables.
3. Assets are valued. Each account type gets its credit percentage, covered below.
4. Seasoning is checked. Statements must show the money has been in place long enough.
5. Credit and housing history are reviewed. The qualifier path has a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix.
6. The property is appraised and leverage is applied. The lower of value-based limits and path limits controls the loan size.
7. The lender makes its own call. Everything here is subject to underwriting and lender guidelines.
Cash-out proceeds never count as qualifying assets. You cannot borrow against the property, park the cash in an account, and then use that cash to qualify. The assets that qualify you must already be yours and already seasoned.
The Two Paths Side by Side
| Factor | Asset Qualifier | Asset Depletion |
|---|---|---|
| How assets work | Cover the whole loan | Become monthly income |
| Income documented | None | Derived from assets |
| Property types | Principal residence, second home | Also investment property |
| Cash-out leverage | Set by lender, not published | 60% on all three |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Seasoning | 60 days, two statements | Statements 120+ days old |
These figures come through select programs and are subject to underwriting.
What Counts, and at What Percentage
On the asset qualifier path, brokerage accounts, certificates of deposit, money market, and savings count at 100%. Retirement accounts such as a 401(k) or IRA count at 90% if you are under 59½ and 100% at 59½ or older. Accounts combine.
On the asset depletion path, the haircuts are steeper:
- Cash accounts and certificates of deposit count at 100%.
- Securities count at 80%.
- Retirement accounts count at 70% at any age.
- Real-estate equity counts at 60%.
Several asset types are not eligible on the depletion path. These include 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.
Privately held stock, meaning closely held company shares, is not eligible on either path. Cryptocurrency, precious metals, collectibles, borrowed or pledged funds, and business accounts beyond your ownership share are also not published as eligible. The documented route for any of these is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
Two Illustrative Examples
These examples are illustrative, and the lender’s own calculation governs.
Qualifier path. Say the loan is $800,000. You hold $330,000 in brokerage accounts, which counts at 100%, or $330,000. You hold $300,000 in a 401(k) and are under 59½, so it counts at 90%, or $270,000. You hold $200,000 in savings, which counts at 100%, or $200,000. Usable assets total $800,000, which matches the loan, so the file is reviewed on assets alone, subject to underwriting.
Depletion path. Say you hold $1,500,000 in securities, which count at 80%, or $1,200,000. You also hold $300,000 in cash at 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 your other debts through the debt-to-income test.
The depletion path also has minimums. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. They can never fall below $250,000 in liquid assets when asset depletion is your only income source. If you have documented income as well, asset-derived income can supplement it up to a 45% debt-to-income ratio, and the minimum-assets rule is waived.
Choosing the Best Asset-Based Cash-Out Refinance Program to Go Fixed
Start with the cash you actually need. If you only want to swap a variable payment for a fixed one, a rate-and-term refinance may fit better. On the depletion path, a principal residence or second home can go up to 80% on a rate-and-term refinance, versus 60% on a cash-out. Investment property is 65% on rate-and-term versus 60% on a cash-out. Adding even a little cash can turn the file into a cash-out and lower the leverage ceiling.
On a principal residence or second home, the qualifier path allows up to 75% on a refinance. Whether cash-out proceeds are allowed on that path, and at what leverage, is the lender’s decision and is not published. Ask your broker to confirm it for your scenario before you plan around it.
Then run the same screen on every option you compare:
- Fixed-rate structure. Confirm the option is offered on your file, along with its term and amortization.
- Prepayment terms. The CFPB explains that a prepayment penalty can apply if you pay off or refinance within roughly the first three to five years. Get quotes with and without one and compare the full structure.
- Asset treatment. Overlays differ, so two lenders can credit the same statements differently.
- Seasoning and statement dates. Account timing can decide which path works for you now.
- Property type and occupancy. Investment property is available only on the depletion path.
- Whole-file cost. Compare closing costs and loan structure side by side, not only the headline number.
Brokers shop several wholesale lenders and match the scenario to the program. That is the practical meaning of best here: the program whose rules fit your assets, not the one with the loudest advertising.
Where the General Rule Breaks
Business owners. Closely held company stock cannot be counted, however valuable it is. If you are selling, the proceeds from a sale or buyout, once converted to seasoned cash, are the documented route. On the depletion path, sale-of-business, inheritance, and legal-settlement funds are excused from the 120-day statement seasoning.
First-time investors. On the depletion path, a first-time investor needs a 700 score.
Housing events. Multiple bankruptcies are not eligible. A housing event needs four years of seasoning on the depletion path. Housing history is 0x30x12, though one 30-day late in the last twelve months is considered case by case.
Big retirement balances. A retirement account counts at 90% or 100% on the qualifier path but only 70% on the depletion path. The same money can look very different depending on the path.
Investment property. If the collateral is a rental, the qualifier path is off the table. Only the depletion path, with business-purpose financing, covers investment property.
Large loans. The qualifier path tops out at $4,000,000. The depletion path runs from $125,000 to $3,500,000. Never assume a higher number exists.
When This Is Not the Right Program
Skip asset-based lending if your assets are thin and your income is strong. A conventional refinance on documented income will likely serve you better. Skip it if most of your wealth sits in private company shares, crypto, or other assets that do not count, unless you can convert them first.
It is also a poor fit if you need high-leverage cash-out. The depletion path caps cash-out at 60%, and many borrowers expect more. Finally, if you plan to sell within a few years, check for a prepayment penalty first. A cheaper structure can lose its savings if an early payoff triggers a fee. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
What to Prepare Before You Apply
- Two months of statements for every account you may use, and the oldest statement dates available.
- A list of which accounts are retirement, brokerage, cash, and certificates of deposit.
- Your current loan’s payoff details and any prepayment terms on it.
- The property address, ownership details, and a rough value.
- Your honest cash-out target and what the money is for.
With that in hand, a broker can tell you within one conversation which path fits and where the weak points are. Programs change, and every file is underwritten individually.
Frequently Asked Questions
Can privately held company stock count toward qualifying?
No. Privately held company stock is not an eligible asset on either path. If you own part of a business, the route is documented liquid assets: seasoned proceeds from a sale or conversion, cash, public securities, and retirement accounts at their credit percentages.
Can I qualify with retirement accounts if I am under 59½?
Yes, on both paths, with different credit. On the qualifier path, 401(k) and IRA balances count at 90% under 59½ and 100% after. On the depletion path, retirement accounts count at 70% at any age. Eligibility is subject to underwriting.
Does the cash I pull out count as an asset for qualifying?
No. Cash-out proceeds never count as qualifying assets. Your qualifying assets must already be in your accounts and seasoned before the loan.
Can I use this program on a rental property?
Only on the asset depletion path, where the loan is business-purpose. Investment property goes up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. The qualifier path covers principal residences and second homes.
What is the minimum credit score?
The qualifier path’s published floor is 600. The depletion path follows the lender’s score and loan-amount matrix, and a first-time investor needs 700. Credit is one part of a full review, and meeting a floor does not guarantee approval.
Compare Your Options
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 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. CFPB: A Look at Cash-Out Refinance Mortgages and Their Borrowers
2. CFPB: What Is a Prepayment Penalty
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 With Stock Options as Your Main Asset · Best Asset-Based Cash-Out Refinance Program in Retirement on a Fixed Income
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Required disclosures. Lendmire (NMLS# 2371349) operates as a licensed mortgage broker, not a direct lender or depository. The discussion in this article is general in nature and should not be relied upon as financial, legal, or tax advice — every investment scenario is unique and should be reviewed by a qualified professional. Any loan inquiry is subject to lender underwriting, and this article is not a commitment to lend or a guarantee of approval. Mortgage rates, loan terms, and program guidelines vary by borrower, property, and state, and may change without notice. Equal Housing Opportunity. Verify licensure at NMLS Consumer Access.