The Quick Read: The right program depends on how you will use the house, because the asset depletion path is the one that publishes a cash-out limit: 60% loan-to-value on a principal residence, second home or investment property, subject to underwriting. Every route also needs the deed recorded in the heir’s name first.
- The asset qualifier path covers the whole loan with eligible assets and documents no employment or income.
- The asset depletion path divides usable assets by 60 months to create a qualifying income.
- Recorded title comes before any cash-out loan, and court letters alone do not create it.
- Privately held company stock does not count as an asset on either path.
- You can qualify with no traditional personal-income documentation, pay stubs or employment verification, but every file is fully underwritten and your assets are documented with statements.
Many heirs are asset-rich and income-light. A retiree inherits a house, a business owner has just sold a company, or a household lives off a portfolio. A traditional lender sees thin paychecks. An asset-based program sees the balances. Lendmire is a mortgage broker that matches this kind of scenario to the right program in its wholesale network. Details follow.
Key Terms Defined
Cash-out refinance: a new first mortgage that pays off any old loan and gives you the extra equity as cash.
Asset qualifier path: the route where eligible assets, after credit percentages, equal or exceed the entire loan amount.
Asset depletion path: the route where usable assets divided by 60 months become a monthly qualifying income.
Seasoning: the time money has sat in an account, or the time you have held title, before a lender counts it.
Recorded title: a deed filed with the county that makes you the legal owner.
Non-QM: a loan that follows its own underwriting rules instead of standard agency rules.
Title Comes First, Money Second
Letters from the probate court give an executor authority over the estate. They do not make you the owner. A cash-out loan needs the heir, or the heir’s trust or LLC, to hold recorded title that a title insurer will insure.
Pierce Law Group, a North Carolina probate practice, describes two ways forward. One is a recorded executor’s deed or deed of distribution to the heir. The other is the personal representative joining the new deed of trust, or a court order approving the loan. That is one state’s practice, not a national rule, so your own attorney and title company set the path.
How the house passed to you matters. 253 Realty notes that most homes go through probate unless they were held in joint tenancy, in a trust, or under a transfer-on-death deed. The stage you are in decides what is realistic.
| Stage | Realistic now? | What blocks it |
|---|---|---|
| Probate open, no deed | Prepare only | Estate owns the house |
| Letters issued, no deed | Prepare only | Letters are not title |
| Deed recorded to you | Yes, underwritten | Seasoning and LTV rules |
| Trust or TOD transfer | Often earlier | Title insurer must sign off |
| Deed to your LLC | Program-dependent | Entity and vesting review |
How Underwriting Treats the File, Step by Step
1. Confirm how title passed. A will, intestacy, trust, transfer-on-death deed or survivorship each leaves different paperwork.
2. Gather documents. You need the death certificate, court letters if probate applies, the will or heirship evidence, and the existing deed.
3. Record the deed. The deed goes to you, your trust, or your LLC, depending on the program.
4. Pay off existing liens. Payoff letters cover any mortgage. A free-and-clear inherited house is often still treated as cash-out, not rate-and-term.
5. Order the appraisal. The lender sizes the loan against appraised value. Repairs may support a higher value, depending on comps and underwriter review.
6. Qualify on one path. You are tested on the qualifier path or the depletion path, never both at once.
7. Close on a new first lien. Everyone on title signs the security instrument.
Which Path Fits Which Heir?
Start with the loan you need and the assets you hold. The two paths use different leverage, different asset credit and different seasoning, so the figures never blend.
| Heir situation | Likely path | Main limit |
|---|---|---|
| Assets cover the whole loan | Qualifier | Cash-out set by lender |
| Large portfolio, no paycheck | Depletion | 60% cash-out LTV |
| Keeping it as a rental | Depletion | 60% cash-out LTV |
| Moving in as a home | Either | Path rules apply |
Qualifier path. Your eligible assets must equal or exceed the entire loan amount. Loans run to $4,000,000, with up to 75% loan-to-value on a refinance of a principal residence or second home, through select programs. Whether cash-out proceeds are allowed here, and at what leverage, is set by the lender and is not published. Credit starts at a 600 minimum score, and no reserves are required at or below 75% loan-to-value.
Here is the math. Take an $800,000 loan. You hold $330,000 in brokerage accounts (100% counts), $300,000 in a 401(k) while under age 59½ (90% counts, or $270,000), and $200,000 in savings (100% counts). That is $800,000 of usable assets, which can qualify on assets alone, subject to underwriting.
Depletion path. Eligible assets become income. Loans run from $125,000 to $3,500,000. On a cash-out refinance, leverage tops out at 60% loan-to-value on a principal residence, second home or investment property. A purchase or rate-and-term refinance can reach 80% on a principal residence or second home and 65% on an investment property. Cash-out proceeds never count as qualifying assets.
Here is the math. Take $1,500,000 in securities (80% counts, or $1,200,000) plus $300,000 in cash (100% counts). That is $1,500,000 usable, divided by 60 months, or $25,000 a month of qualifying income. That income then carries the housing payment and other debts through the debt-to-income test.
The depletion path asks for qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan balance. It never drops below $250,000 liquid when assets are your only income. Asset-derived income can also supplement documented income up to a 45% debt-to-income ratio. When it does, the minimum-assets rule is waived. Credit follows the lender’s matrix, and a first-time investor on this path needs a 700 score.
What Counts as an Asset
On the qualifier path, brokerage accounts, certificates of deposit, money market and savings count at 100%. Retirement accounts count at 90% under age 59½ and 100% after. Accounts combine.
On the depletion path, cash and CDs count at 100%, securities at 80%, retirement accounts at 70% at any age, and real-estate equity at 60%. Custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options and non-vested restricted stock units are not eligible there.
Privately held company stock is not an eligible asset on either path. That matters for heirs who inherit shares of a family business. The documented route is a sale or buyout converted to a cash balance, plus cash, public securities and retirement accounts at their percentages.
Cryptocurrency, precious metals, collectibles and borrowed funds are not published as eligible on either path. Convert them to cash in a regulated account and let the lender review the source.
Inherited cash is not income, but it can be an asset. Depletion-path files excuse inheritance funds from the seasoning rule. Expect to document where the money came from.
Seasoning for Heirs
Two clocks run on an inherited file. The first is the money. The qualifier path wants 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 statement within 45 days. It excuses sale-of-business, inheritance and legal-settlement funds from that seasoning.
The second clock is time on title. No national rule governs how a program counts an inherited transfer. Programs generally measure from the recorded deed, not the date of death, though treatment varies. Conventional agency guidelines have their own inheritance exceptions, and asset-based programs do not have to mirror them. Ask early how the target program counts an inherited deed.
Where the General Rule Breaks
Probate still open. The estate owns the house, and a personal representative acts for the estate, not as you. An heir-level cash-out waits for the deed.
Several heirs. Everyone on title signs. One heir who will not cooperate stalls the file, and a buyout is the usual fix.
Buyouts inside the cap. The new loan must cover the payoff, the buyouts and the costs. On the depletion path that total has to fit under 60% of appraised value. Every added heir makes that harder, so run the totals before you promise siblings a number.
Decedent still on the deed, or an unknown heir. A title insurer cannot insure all interests. A court process or heir affidavit fixes this.
Moving title into an LLC. Some programs review the vesting or restart the clock, subject to program terms. Practitioners describe this inconsistently, so ask before you record anything.
An existing inherited loan. Federal law limits a lender’s power to call an existing mortgage due when it passes to a relative at the owner’s death, as 12 U.S.C. §1701j-3 sets out. That protects a loan you already have. It does not give you a right to a new loan or to cash out. It is also aimed at owner-occupied homes, so ask counsel how it applies to a tenanted rental.
Inherited property generally takes a basis set at its value on the date of death, which is covered in IRS Publication 551; tax treatment varies, so consult a qualified professional.
Picking the Best Asset-Based Cash-Out Refinance Program on an Inherited Property
The best program for your situation depends on income, assets, occupancy and plan. A broker that shops several wholesale lenders can match the scenario to the program that writes it. The lenders that write this vary by leverage, credit matrix and how they treat inherited titles.
| Option | What it tests | Fits heirs who |
|---|---|---|
| Asset-based mortgage | Statements and assets | Hold cash, light on income |
| Bank statement loan | Deposits as income | Run a business |
| HELOC or second lien | The program’s own rules | Keep a cheap inherited loan |
| Rental income loan | Rent against payment | Keep a tenanted rental |
If you plan to keep a tenanted rental and want rent, not your assets, to carry the loan, see Lendmire’s piece on a best DSCR cash-out refinance program on an inherited property.
Qualifying on assets is not free of trade-offs. Cash-out leverage is modest, the asset minimums are real, and pulling equity raises your obligation. Plan for what the cash will do for you before you take it.
On a practical level, ask any lender these questions:
- Does the program count my inherited transfer as seasoned?
- Which path fits, and what cash-out limit applies to my occupancy?
- How are my retirement accounts and securities credited?
- What does the title company need before it will insure the deed?
What to Gather
- Death certificate and court letters, if probate applies
- Recorded deed to you, your trust or your LLC
- Statements for every qualifying account, covering the months the path requires
- Documents showing the source of inherited or sale proceeds
- Payoff letters for any mortgage or lien
- A buyout agreement, if co-heirs are being paid out
Frequently Asked Questions
Can I do a cash-out refinance before probate closes?
No, not as the heir. While probate is open, the estate owns the house and the personal representative acts for the estate. You can gather assets and statements now, then move once the deed records.
Does a paid-off inherited house still count as cash-out?
Often yes. Taking money out of a free-and-clear property is commonly treated as cash-out, so the cash-out leverage limit applies, not the rate-and-term one.
Does inherited money count toward qualifying?
It counts as an asset, not as income. On the depletion path, inheritance funds are excused from the seasoning rule. The lender still reviews where the money came from.
Can I use a cash-out to buy out my siblings?
Yes, in many cases, if the new loan covers the payoff, the buyouts and the costs within the leverage limit. Everyone on title has to cooperate.
Is privately held family business stock an eligible asset?
No. Convert it through a documented sale into cash and let the lender review the proceeds.
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 programs based on your statements, the property, credit profile, leverage and your goals. The consumer mortgage program is available in Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington. Programs change, and every file is underwritten individually. Nothing here is a commitment to lend.
An inherited house rewards the heir who handles title first and the loan second.
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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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. Pierce Law Group, transferring title of a deceased parent’s home to refinance
2. 253 Realty, putting an inherited house in your name
3. 12 U.S.C. §1701j-3, Cornell Legal Information Institute
4. IRS Publication 551, Basis of Assets
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 No Income Other Than Assets
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- 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.