Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.
The Quick Read: Qualifying below a program’s minimum loan amount means finding out what the lender’s floor actually measures, documenting eligible assets on one path (assets that cover the whole loan, or assets converted to monthly income), and routing the file to a program whose floor fits the new loan after leverage. The floor is a program setting, not a law. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
- The floor applies to the new loan, not to the property price or the old balance.
- The asset qualifier path covers the loan with assets and documents no employment or income.
- The asset depletion path divides usable assets by 60 months to create income. Its published loan range starts at $125,000.
- Cash-out proceeds never count as qualifying assets.
- Every file is fully underwritten, subject to lender guidelines. This is not a commitment to lend.
What Does “Below Minimum” Actually Mean?
A loan is below the minimum when the new loan amount, after leverage and payoff, lands under the floor a program sets. The floor is not a legal limit. It is a parameter each program chooses for itself. The property price and the old mortgage balance are not the test.
Here is how the squeeze works on a cash-out. The lender takes the appraised value and multiplies it by the leverage limit. It subtracts the payoff on the existing loan. What remains is the most the new loan can be. If that number sits under the program’s floor, the file does not fit that program.
Three things push a file under the floor:
1. Modest value. A lower value caps the total loan.
2. A large payoff. The old mortgage eats most of the room.
3. Tight leverage. On the asset depletion path, cash-out is limited to 60% loan-to-value on a principal residence, a second home or an investment property.
A small existing balance does not make a small new loan. Someone with a nearly paid-off house and strong equity can still clear the floor easily. A borrower with a large payoff and a mid-priced home often cannot.
The published depletion path range runs from $125,000 to $3,500,000. So a new loan under $125,000 does not fit that path, subject to underwriting. The qualifier path runs up to $4,000,000. Its minimum loan size is set by the lender and is not published, so a small loan there has to be confirmed program by program. The exact numbers vary by lender and program and follow a full review of property, leverage, and credit.
Key Terms Defined
Cash-out refinance: A new loan that pays off the old mortgage and gives the borrower the difference in cash. Corporate Finance Institute explains how it differs from a rate-and-term refinance.
Loan-size floor: The smallest new loan a program will place. It is a program setting and it varies.
Asset qualifier path: Eligible assets, after the usable percentages, must equal or exceed the entire loan. No employment or income is documented.
Asset depletion path: Usable assets divided by 60 months become a monthly qualifying income. That income runs through the debt-to-income test.
Usable percentage: The share of an account balance that counts. Securities on the depletion path count at 80%. The other 20% does not count.
Loan-to-value (LTV): The new loan divided by the appraised value.
How the Two Paths Treat a Small Cash-Out
The two paths solve different problems. A borrower is qualified on one path at a time. The figures never blend.
| Factor | Asset qualifier path | Asset depletion path |
|---|---|---|
| How assets are used | Cover the whole loan | Become monthly income |
| Income documented | None | Derived from assets |
| Loan range | Up to $4,000,000 | $125,000 to $3,500,000 |
| Cash-out leverage | Set by lender, not published | 60% on all property types |
| Investment property | Not offered | Offered, business-purpose |
| Statement seasoning | 60 days, two months per account | Statements at least 120 days old, plus the most recent one within 45 days |
Subject to underwriting, the qualifier path is the more natural fit for a small loan, because a smaller loan needs fewer assets behind it. The catch is that cash-out treatment on that path is the lender’s call. Confirm it before anyone builds a plan on it.
The depletion path works the other way. The loan floor is published, and so is the 60% cash-out limit. But it carries a minimum-assets test. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan. When assets are the only income source, that figure can never drop below $250,000 liquid. A smaller loan shrinks the 1.25x side, but it does not remove the $250,000 floor. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
Here is the shape of the depletion math. Say a borrower holds $1,500,000 in securities (80% counts, so $1,200,000) plus $300,000 in cash (100% counts). That is $1,500,000 usable. Divided by 60 months, it 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. The lender’s own calculation governs.
The Step-by-Step Qualification Check
Run these steps before you talk to anyone.
1. Size the new loan. Take the appraised value, apply the leverage limit for your path and occupancy, and subtract the payoff. The result is the most the new loan can be. Use 60% on the depletion path.
2. Compare it with the floor. On the depletion path the floor is $125,000. If the result sits under it, the file does not fit that path as structured.
3. Count usable assets. Apply the percentages for the path, as set out in the next section. Combine accounts on the qualifier path. Leave out anything the program does not accept.
4. Pick the path. If usable assets equal or exceed the whole loan, the qualifier path may fit. If not, or if the property is an investment property, look at the depletion path.
5. Check the credit. The qualifier path publishes a 600 minimum score. The depletion path follows the lender’s score and loan-amount matrix. A first-time investor on the depletion path needs 700. Housing history is 0x30x12. One 30-day late in the last twelve months is considered case by case.
6. Confirm cash-out treatment. On the qualifier path, ask whether cash-out proceeds are allowed and at what leverage. On the depletion path, confirm that the 60% limit applies to your occupancy.
7. Assemble statements. Check the seasoning rules before ordering anything.
Reserves are simple. The qualifier path requires none at or below 75% loan-to-value, and above that the lender sets them. The depletion path publishes no reserve months.
Which Assets Count, and Which Do Not
Percentages below are the share of the balance that counts.
Qualifier path: brokerage accounts, certificates of deposit, money market and savings count at 100%. A 401(k) or IRA counts at 90% under age 59½ and at 100% at 59½ or older. Accounts combine.
One worked case: an $800,000 loan with $330,000 in brokerage accounts (100% counts), $300,000 in a 401(k) under 59½ (90% counts, so $270,000) and $200,000 in savings (100% counts). That is $800,000 of usable assets. The file is reviewed on assets alone, subject to underwriting.
Depletion path: cash 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%.
Not eligible on the depletion path: custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options, non-vested restricted stock units, privately held stock, and funds from non-regulated financial companies.
Privately held company stock is not an eligible asset on either path. A founder or shareholder with a large closely held position has one route. Convert it into documented liquid assets. A sale or buyout turns into a seasoned cash balance. Public securities and retirement accounts then count at their percentages.
Cryptocurrency, precious metals, collectibles, pledged or borrowed funds, and business accounts beyond the borrower’s ownership share are not published as eligible on either path. The route is the same. Convert them to a seasoned cash balance in a regulated account. The lender reviews the source of the funds.
One rule matters most for cash-outs. Cash-out proceeds never count as qualifying assets. A borrower cannot pull cash from the property and then use that cash to qualify for the same loan.
Here is how the agency world differs. Fannie Mae’s selling guide on employment-related assets sets its own conditions for turning assets into qualifying income. Those are agency rules for agency loans. They are not the percentages or minimums in the asset-based program described here.
If Your Loan Falls Under the Floor
A file under the floor still has moves. Each one has a cost.
| Situation | Move | Trade-off |
|---|---|---|
| Loan just under the depletion floor | Check the qualifier path | Cash-out treatment is set by lender |
| Modest equity, large payoff | Skip the cash-out | Loses the cash you wanted |
| Small draw needed | Use a HELOC or other second lien | Different product, different rules |
| Investment property | Business-purpose rental financing | Reviewed on rent, not assets |
| Strong income but thin assets | Bank statement program | Income documented through deposits |
| Very small draw | Keep the current loan | No new closing costs |
A few notes on the table.
Pulling more cash is not a fix. Borrowing extra to clear a floor raises the loan, and it only works if leverage allows it. On the depletion path, 60% is the ceiling. It also adds debt you did not need.
A HELOC is a different product. It is a second lien. It leaves the first mortgage in place. That can make sense when the existing loan has terms worth keeping. Its rules differ from this program’s.
A rental property can use another route. Business-purpose rental financing is DSCR, which qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Investment property can also use the depletion path, where the loan is business-purpose. The two are different tests on the same building. Choose the one that matches the borrower’s strengths.
Bank statement loans suit a different borrower. They are for people who document income with deposits. Someone with large balances and little income usually fits the asset-based paths better.
Is a Small Cash-Out Worth Doing?
Sometimes it is not. Fixed costs do not shrink with the loan. A small draw carries about the same appraisal, title and processing steps as a large one. If gross cash-out is modest, costs take a bigger share of it.
Run a break-even before applying:
- Start with the gross cash-out.
- Subtract all closing costs.
- Subtract the cost of giving up the old loan’s terms, if those terms were good.
- Compare the net with what a HELOC, a savings draw or a sale of a security would deliver.
If the net is thin, stay put. If the net funds something with a clear return, go ahead.
Also weigh what a new loan does to the rest of the file. A cash-out raises the balance. On the depletion path it also raises the debt the derived income must carry. A smaller draw that leaves room in the debt-to-income test is easier to defend than a maximum draw.
Everything here is a ceiling, not an offer. The lender’s calculation governs, and costs vary by file.
How to Apply
The application turns on documents. Gather these before the first call:
- Asset statements. Two months per qualifying account on the qualifier path. On the depletion path, statements at least 120 days old 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 on the depletion path.
- Existing mortgage statement. It shows the payoff.
- Property documents. Tax bill, insurance and any HOA statements.
- Identification and credit authorization.
- Source documents for any large recent deposit. A sale, an inheritance or a settlement each needs paper behind it.
- Entity papers if the property is held in one, depending on program guidelines.
The program has no traditional personal-income documentation, pay stubs or employment verification on the qualifier path. That does not mean no paperwork. The assets are documented line by line, and every file is fully underwritten.
Then follow this order:
1. Share the scenario. Give value, payoff, property type and occupancy, assets by type, credit range and the cash you want.
2. Get the path matched. A broker compares your numbers against the floors, leverage limits and overlays of select lenders in the network. Lendmire’s asset-based mortgage programs are placed this way. Lendmire is the broker, not the lender.
3. Confirm cash-out treatment. Ask before ordering the appraisal.
4. Submit statements and property documents. Complete files leave fewer gaps for the lender to question.
5. Respond to underwriting conditions. Expect questions on large deposits and account ownership.
6. Review and settle. The lender’s final numbers govern.
The program is available through 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. It is subject to underwriting and lender guidelines.
Common Mistakes
Counting cash-out proceeds as assets. They never count. Qualifying assets come from existing accounts.
Reading the floor as the property price. The floor tests the new loan. A cheap house can still clear it, and an expensive one with a big payoff can miss.
Assuming a small balance means a small loan. Payoff and new loan are different numbers. Do the sizing math first.
Blending the two paths. Qualifier-path leverage does not apply on the depletion path, and the reverse. Name the path every time a figure appears.
Including ineligible assets. Privately held stock, cash on hand, stock options and unvested restricted stock units do not count. Counting them overstates usable assets and sends the file back.
Skipping the seasoning check. Statements that are too new or too old stall the file. Lenders also look at how long you have owned the property. On agency cash-out loans, Fannie Mae requires the existing first mortgage to be at least 12 months old. That is an agency rule. The asset-based seasoning for the property is set by the lender, so confirm it at the start.
Forgetting credit and housing events. A housing event needs 4 years of seasoning on the depletion path. Multiple bankruptcies are not eligible.
Frequently Asked Questions
Can the loan be below the minimum and still qualify?
It depends on the path and the lender. The depletion path publishes a $125,000 floor, so a loan under that does not fit as structured. The qualifier path has no published floor, so the lender sets it. Underwriting decides, and nothing here is a commitment to lend.
Do cash-out proceeds count toward the assets I need?
No. Cash-out proceeds never count as qualifying assets on either path. The assets must already sit in eligible accounts and meet the statement rules before the loan.
What if most of my wealth is stock in my own private company?
The route is documented liquid assets. Seasoned proceeds from a sale or buyout, cash, public securities and retirement accounts all count at their stated percentages.
Does the property have to be a primary home?
No, but the paths differ. The qualifier path covers a principal residence or second home. The depletion path also covers investment property, where the loan is business-purpose and cash-out is limited to 60% loan-to-value.
Is this a no-documentation loan?
No. The file is fully underwritten and the assets are documented with statements. What the qualifier path leaves out are tax returns, pay stubs and employment verification.
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.
A deeper walk-through of investment-property equity extraction lives in Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire is a mortgage brokerage (NMLS# 2371349) licensed for consumer mortgage lending in 16 states, arranging bank statement and other alternative-documentation mortgages — P&L-only, 1099-only and asset-based paths — through a wholesale lending network. Eligibility is determined by the lender on each file. 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. Corporate Finance Institute: Cash Out Refinance
2. Fannie Mae Selling Guide B3-3.4-06: Employment Related Assets Qualifying Income
3. Fannie Mae: Updates Cash Out Refinance Eligibility
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 Without a Mortgage · Can You Get Approved for an Asset-Based Cash-Out Refinance at 75% Loan-to-Value?
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
Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.