The Quick Read: The best program depends on which of two asset-based paths fits your balance sheet, because one covers the loan with assets alone and the other turns assets into monthly income. Cash-out proceeds never count as qualifying assets, so the money you pull from one house cannot be used to qualify for the next.
- Asset qualifier path: eligible assets must equal or exceed the entire loan, and no employment or income is documented.
- Asset depletion path: usable assets divided by 60 months become qualifying income, which runs through the debt-to-income test.
- Cash-out leverage: on the depletion path, cash-out is capped at 60% on a principal residence, a second home or an investment property, subject to underwriting.
- Qualifier-path cash-out: the lender sets it and it is not published, so no figure is stated here.
- Statements: no traditional personal-income documentation, pay stubs or employment verification, but every asset is documented and every file is fully underwritten.
Asset-based mortgage programs suit a particular reader: retirees, people who have sold a business, recipients of an inheritance or settlement, early-retired professionals, and households living off a portfolio. Their balances are large and their documented income is small. Lendmire is a mortgage broker, not a lender, and it places these files with select lenders in its wholesale network. The program is consumer lending, licensed in 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington. Everything below is a ceiling or a floor, never an offer, and all of it sits subject to underwriting.
What “Asset-Based” Means on a Cash-Out Refinance
A cash-out refinance replaces your current loan with a larger one and hands you the difference as cash. The CFPB describes this as a way for homeowners to tap equity. “Asset-based” changes what the lender looks at to decide you can repay it. Instead of pay stubs and tax returns, the file rests on statements for accounts you already hold.
Across our wholesale network, this shows up in two distinct ways. Under one, the assets cover the loan outright. Under the other, the assets are converted into an income figure. You are qualified on one path at a time, never both, and the tables never blend.
The honest answer to “best program” is that no program wins for everyone. The right fit depends on your property type, your credit, how much leverage you need, and what your statements look like. A broker that shops several lenders can match the file to the guideline set that suits it. That matching is the value, not a ranking of brands.
Key Terms Defined
Cash-out refinance: a new, larger loan that pays off the old one and returns the difference to you as cash.
Rate-and-term refinance: a new loan that replaces the old balance and closing costs without returning cash.
Asset qualifier path: the route where eligible assets, after credit percentages, must equal or exceed the whole loan amount.
Asset depletion path: the route where usable assets divided by 60 months become a monthly qualifying income.
Seasoning: how long funds have sat in your accounts before the lender will count them.
Haircut: the part of an asset’s balance that does not count, so only the remaining share is usable.
The Two Paths Side by Side
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| How assets are used | Must cover the entire loan | Divided by 60 months into income |
| Income documented | None | Derived income through DTI |
| Purchase leverage | Up to 80% LTV | 80% primary/second; 65% investment |
| Refinance leverage | Up to 75% LTV | 80% rate-and-term primary/second; 65% investment |
| Cash-out leverage | Lender-set, not published | 60% on all occupancies |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit | 600 minimum | Lender’s matrix |
Read the table by path. The qualifier path’s 80% and 75% figures are for a principal residence or second home. The depletion path is the only one that reaches an investment property, and there the loan is business-purpose.
Which Assets Count, and How Much
The percentages differ by path, so keep them separate.
| Asset | Qualifier path | Depletion path |
|---|---|---|
| Brokerage accounts | 100% | Securities 80% |
| Certificates of deposit | 100% | 100% |
| Money market and savings | 100% | Cash accounts 100% |
| Retirement accounts | 90% under 59½; 100% at 59½+ | 70% at any age |
| Real-estate equity | Not listed | 60% |
Accounts combine on both paths. Not eligible on the depletion path: 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 company stock is not an eligible asset on either path. A founder or shareholder reaches the program through documented liquid assets instead: seasoned proceeds from a sale or buyout, cash, public securities and retirement accounts at their percentages. Cryptocurrency, precious metals and collectibles are not published as eligible either. The route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender.
How the Math Works on Each Path
On the qualifier path, picture an $800,000 loan. A borrower holds $330,000 in brokerage accounts (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.
On the depletion path, take $1,500,000 in securities (80% counts, so $1,200,000) plus $300,000 in cash (100%). That is $1,500,000 usable, divided by 60 months, or $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 lender’s own calculation governs, and this is illustration only.
Assets can also supplement documented income on the depletion path, up to a 45% debt-to-income ratio. When they supplement, the minimum-assets rule is waived.
What Decides Whether You Can Use the Cash to Buy Another House
This is where most borrowers get tripped up. Three rules do the work.
Proceeds are not assets. Cash-out proceeds never count as qualifying assets. You cannot borrow against House A, park the money in an account, and count it toward House B’s qualification. Whatever carries the next file has to be assets you already hold.
Two caps, and the lower wins. On the depletion path, the value cap is appraised value times 60%. The income cap is what your derived monthly income can support through debt-to-income. Cash to you is the new loan minus the old payoff, any junior liens and closing costs. A low appraisal shrinks the first cap, and heavy existing debt shrinks the second.
Seasoning governs the funds. The qualifier path needs 60 days of seasoning and two months of statements for each qualifying account. The depletion path wants statements at least 120 days old at application, plus the most recent one within 45 days. Funds from the sale of a business, an inheritance or a legal settlement are excused from that seasoning.
A related point: the depletion path needs qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. It also needs at least $250,000 in liquid assets when asset depletion is your only income source.
Which Route Fits Which Buying Scenario
| Situation | Likely route | What drives approval | Watch-outs |
|---|---|---|---|
| Large liquid balances, loan fully covered | Qualifier | Eligible assets at least equal the loan | Cash-out terms set by lender |
| Buying a rental with a portfolio but little income | Depletion | Derived income and 65% purchase leverage | Investment property is the tightest leverage |
| Second home or vacation purchase | Either | Assets and credit | Occupancy matters to leverage |
| Equity-rich, thin documented income | Depletion | 60% cash-out ceiling | Minimum-assets test |
| Business owner with illiquid ownership | Convert first | Seasoned cash from a sale | Private stock is not eligible |
Credit and History
The qualifier path publishes a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix, and a first-time investor there needs 700. Housing history is 0x30x12, so one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible, and a housing event needs 4 years of seasoning on the depletion path.
The practical lesson is to avoid new credit before you apply.
Where the General Rule Breaks
Recent cash buyers. If you paid cash for a property recently, delayed financing is a lender-by-lender policy that waives the seasoning wait on that purchase. It is not a loan product, and proceeds are generally limited to documented cost rather than appraised value.
Free-and-clear property. With no payoff, any cash taken is still a cash-out, so the cash-out ceiling applies.
Rate-and-term versus cash-out. If cash comes back, the lower cash-out ceiling applies. A higher-leverage rate-and-term structure returns no cash.
Investor-owned collateral. If the property you are refinancing or buying is a pure rental, there is often a better lane for the next one. For a rental that is reviewed on its own income, DSCR financing typically fits, and asset-based paths are for borrowers whose statements are the strongest part of the file. DSCR loans are designed for non-owner-occupied investment properties, and they are reviewed differently from a standard owner-occupied mortgage.
Short-term rentals. If the next house is meant as an Airbnb-style rental, appraisal gets harder. Fannie Mae says the one-unit rent schedule was not designed for short-term rentals and cannot be used to estimate a nightly fee. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income.
Is Cash-Out Even the Right Tool?
| Option | Strength | Tradeoff |
|---|---|---|
| Asset-based cash-out | Assets carry the file | Lower leverage; assets must be documented |
| Qualifier path purchase | Assets cover the whole loan, up to 80% LTV | Needs balances equal to the loan |
| Bank statement loan | Fits self-employed deposit history | Requires deposit-based income |
| DSCR loan | Property rent carries the loan | Only for rentals |
| Selling assets | No new debt | Possible tax and growth cost |
Thinking it through: if you hold large securities and the next house is a primary residence, buying under the qualifier path may beat cashing out the old house, because the new loan stands on its own assets and the old house is never touched. If you have equity but thin liquid assets, cash-out on the depletion path is the only route that unlocks the equity, and the 60% ceiling is the price. That tradeoff is the real decision.
Who This Doesn’t Fit
Skip it if your wealth is mostly private company stock, crypto or collectibles you cannot convert to seasoned cash. Skip it if your liquid assets fall under the depletion minimums. Skip it if you need more than the stated loan ceilings. And if a self-employed income history already documents cleanly, an income-based program may cost less and fit better.
Documents to Gather
- Two months of statements for each qualifying account on the qualifier path.
- Statements at least 120 days old, plus one within 45 days, on the depletion path.
- Sale, inheritance or settlement paperwork if those funds are part of the balance.
- A recent housing payment history.
- The current mortgage payoff and property details.
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.
How a Broker Finds the Fit
Lenders that write asset-based files differ on which assets they favor, how they treat cash-out, and how tightly they read seasoning. A broker that shops multiple wholesale lenders can read your statements, place the file with the guideline set that suits it, and explain what to fix before you apply. The detail on each path lives in Lendmire’s asset-based mortgage programs overview.
Frequently Asked Questions
Can I use asset-based cash-out proceeds as the down payment on another house?
Yes, the proceeds can fund a down payment, but they cannot count as qualifying assets for that next loan. Whatever qualifies the new purchase has to be assets you already hold and have documented. Plan the sequence so the next file stands on its own balances.
Do I need tax returns, pay stubs or employment verification?
No. Neither path asks for tax returns, pay stubs or employment verification. Every file is still fully underwritten, and the assets are documented with statements. The depletion path runs your derived income through the debt-to-income test.
Can I do this on a rental property?
Only on the depletion path, where an investment property reaches up to 65% on a purchase or rate-and-term refinance and 60% on a cash-out. The loan is business-purpose there. Subject to underwriting and program availability.
Does private company stock count toward the loan?
No. The route is documented liquid assets, such as seasoned proceeds from a sale or buyout, cash, public securities and retirement accounts at their percentages.
What if the appraisal comes in low?
A low appraisal shrinks the value cap, which is appraised value times the cash-out percentage, so your cash falls with it. Build in a cushion and do not commit to the next purchase until the refinance amount is firm.
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. Lendmire’s team can be reached at 828-256-2183.
For a related situation where the cash funds a different goal, see Lendmire’s piece Best Asset-Based Cash-Out Refinance Program to Buy Out a Co-Owner.
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.
A deeper walk-through of investment-property equity extraction lives in Lendmire’s guide to cash-out refinance on an investment property.
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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
2. Fannie Mae Appraiser Update
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 on One Income
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
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.