The Quick Read: On the asset depletion path, the new loan tops out at 60% of the appraised value on a cash-out, and your cash is that loan minus your payoff and costs, subject to underwriting and the building review.
- The cash is the new loan amount, minus the old loan payoff, minus closing costs.
- On the asset depletion path, the cash-out ceiling is 60% LTV on a principal residence, a second home or an investment property.
- On the asset qualifier path, the lender sets any cash-out limit, and it is not published.
- Cash-out proceeds never count toward your qualifying assets.
- The building can lower the number further, and strong assets cannot fix a weak project. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
A condo that fails the standard project tests gets closer review, and the lender decides how that review affects your leverage. Below, you will also see which limit usually wins and when pulling cash out is the wrong move.
Key Terms Defined
Non-warrantable condo: a unit in a building that fails the standard project tests mainstream lenders use. The label describes the building, not you.
Cash-out refinance: a new loan that pays off the old one and hands you the difference in cash.
LTV (loan-to-value): the loan amount as a percentage of the appraised value.
Asset depletion path: a way to qualify where usable assets are divided by 60 months to create monthly qualifying income. That income then runs through the debt-to-income test.
Asset qualifier path: a way to qualify where eligible assets must cover the entire loan amount. No employment or income is documented.
Seasoning: how long funds must sit in an account before a lender counts them.
What Sets the Cash You Receive?
The cash you receive is the lesser of several ceilings, minus what you still owe. The tightest ceiling wins. Three limits can set the new loan amount: the LTV cap for your path and property use, the loan-size range, and whatever the building review adds.
The formula has four steps:
1. Take the appraised value and multiply it by the governing LTV cap. 2. Check the result against the loan-size range for your path. On the asset depletion path, loans run from $125,000 to $3,500,000. 3. Subtract the payoff of your existing loan and your closing costs. 4. Confirm the assets support the loan on the path you chose.
Whatever is left is your cash. The condo label does not change the arithmetic. It changes the inputs, mostly the LTV the lender will accept on that building.
Here is the shape in percentages, since the appraisal sets the real dollars. Say a condo appraises at 100 units of value and you own it free and clear. At a 60% cap, the new loan is up to 60 units. Your gross cash is up to 60% of the value, before costs. Now say you owe the equivalent of 35% of value. The same 60% cap leaves about 25% of value as gross cash, before costs. That is an illustration of the formula, not an offer. Every file is underwritten individually.
Which Path Fits, and What Does Each Allow?
Two paths exist, and you are qualified on one at a time. Do not blend their numbers. Across the lenders in Lendmire’s wholesale network, the paths differ in how assets are used, how much leverage they allow and what they say about cash-out.
| Factor | Asset Qualifier Path | Asset Depletion Path |
|---|---|---|
| How assets work | Must cover the whole loan | Divided by 60 months into income |
| Income documented | None | Derived income, run through DTI |
| Purchase leverage | Up to 80% | Up to 80% (primary or second home) |
| Refinance leverage | Up to 75% | Up to 80% rate-and-term (primary or second home) |
| Cash-out leverage | Lender-set, not published | 60% on all property uses |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
Read the cash-out row first. On the asset qualifier path, the 75% figure is a refinance ceiling, not a cash-out figure. Whether cash-out is allowed on that path, and at what leverage, is the lender’s decision. Nothing is published, so any promised number there would be a guess. For a cash-out question, the asset depletion path is where the published ceiling lives.
On the asset depletion path, investment property carries a cash-out cap of 60%, the same as a principal residence or second home. An investment condo is a business-purpose loan on this path. A principal residence or second home is a consumer mortgage. Either way, qualifying figures are subject to underwriting and the lender’s own calculation governs.
Many borrowers reading this have large balances and little documented income. That includes retirees, people who sold a business, and households living on a portfolio. If your assets could cover the loan outright, the asset qualifier path may fit a purchase or refinance, and you can ask about cash-out with the lender. If you would rather turn the portfolio into income, the depletion path is the one with a stated cash-out cap. You can read more about Lendmire’s asset-based mortgage programs before you decide.
How Do Your Assets Count Toward the Loan?
Assets count at a share of their balance, and the share depends on the path. Writing each figure as the share that counts keeps the picture clear.
On the asset qualifier path:
- Brokerage accounts, certificates of deposit, money market and savings count at 100%.
- Retirement accounts count at 90% if you are under 59½ and at 100% once you reach 59½.
- Accounts combine, and the total must equal or exceed the entire loan amount.
On the asset depletion path:
- Cash accounts and certificates of deposit count at 100%.
- Securities count at 80%.
- Retirement accounts count at 70% at any age, whether you are under or over 59½.
- Real-estate equity counts at 60%.
Here is the depletion math in one example. Say you hold $1,500,000 in securities, which count at 80% for $1,200,000. Add $300,000 in cash at 100%. Your usable assets are $1,500,000. Divide by 60 months and you get $25,000 of monthly qualifying income. That income must then carry the housing payment and your other debts through the debt-to-income test. The lender’s own calculation governs, and this is an illustration only.
The depletion path also sets a minimum on qualified assets: at least the lesser of $1,000,000 or 1.25 times the loan balance. When asset depletion is your only income source, that minimum also has a liquid requirement of at least $250,000, even if the lesser-of figure comes out lower. A larger cash-out means a larger loan, and a larger loan raises the asset bar.
Borrowers who plan ahead should know one more thing about the asset test. You cannot borrow against the condo and then use that cash to meet the asset test for the same loan.
What About Business Stock, Crypto and Other Assets?
Privately held company stock is not an eligible asset on either path. That is the rule, with no partial credit and no exceptions. Stock options and non-vested restricted stock units are also ineligible on the depletion path.
Cryptocurrency, precious metals, collectibles and pledged or borrowed funds are not published as eligible on either path. The workable route for all of these is to convert them to a seasoned cash balance in a regulated account. The lender then reviews the source of the funds.
A founder who sells shares has a documented route: the proceeds. Once the sale closes, the cash sits in an account and counts at 100% on either path once it meets the seasoning rules. On the depletion path, sale-of-business, inheritance and legal-settlement funds are excused from the 120-day statement-age requirement. Public securities and retirement accounts count at their own shares.
Which Documents Do You Need?
You need statements, not tax returns. The program asks for no traditional personal-income documentation, pay stubs or employment verification. Every file is still fully underwritten, and the assets are documented.
On the asset qualifier path, expect 60 days of seasoning and two months of statements for each qualifying account. On the asset depletion path, statements must be at least 120 days old at application, plus the most recent statement within 45 days.
Credit still matters. The asset qualifier path has a 600 minimum score. The depletion path follows the lender’s matrix. A first-time investor on the depletion path needs 700. Housing history is 0x30x12, and 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.
How Does a Non-Warrantable Building Change the Number?
The building is a second test, and your assets cannot fix it. The lender reviews the project separately from you. A strong portfolio does not override a weak building. Lenders look at the building’s own profile, which can include heavy investor ownership, one entity owning a big share of units, pending litigation, thin insurance or reserves, special assessments, commercial space, developer control, or hotel-style operations.
The label does not end the conversation. Expect the lender’s review of a weaker building to bring the usable LTV below the program ceiling. The 60% cap on the depletion path is a ceiling, not a promise.
Condotels are a different, tighter property type. A hotel-style operation with rental pooling gets closer review, and the lender may cap cash-out lower and attach extra conditions. If your building has any hotel-style features, ask that question early.
Did the Recent Agency Changes Make Your Building Warrantable?
Maybe, and you should confirm building by building. The mainstream agencies recently changed their condo rules. The Community Associations Institute reports that the 50% investor-concentration limit was removed for established projects under full review. Fannie Mae’s lender letter covers the project-standard changes. Some buildings once labeled non-warrantable may now pass.
Two cautions. First, the Michigan Community Association Law Blog notes that lenders can keep their own investor-concentration rules, so a change at the agencies does not automatically become a change at every lender. Second, other triggers remain: litigation, insurance gaps and single-entity ownership still matter.
Tighter rules cut the other way too. PKF O’Connor Davies reports the agency reserve minimum moving from 10% to 15%. That may push some buildings with thin reserves into non-warrantable territory. These are agency rules and do not govern asset-based loans. They matter because they shape which buildings get the label.
Which Limit Binds First?
On a modest condo, the LTV cap binds. On a large one, the loan-size range does. Take a condo worth far more than $3,500,000 on the depletion path. Sixty percent of that value would exceed the loan-size ceiling. The ceiling then sets the new loan, and your cash is the ceiling minus your payoff and costs.
Some programs also add a cash-in-hand cap, a limit on the net cash you can walk away with. Whether that applies depends on the lender. Ask for it by name, because it can cut the cash even when the LTV looks generous.
Here is a third case. Say you own the condo free and clear and plan to use the cash for a down payment on another property. The cash is up to the governing LTV, minus closing costs. Nothing needs paying off. But the new loan is still sized against your assets, so a bigger cash-out means a bigger loan to qualify for. Qualify first, then plan the redeployment around the lowest ceiling on your list.
When Is a Cash-Out Not Worth It?
A cash-out is not worth it when the leverage you can reach is too small to matter. A free-and-clear condo at 60% LTV can release a lot of cash. A condo with a large existing balance may release very little after the payoff and costs. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
Three more reasons to pause:
- A narrow exit market. Buyers who need financing may find mainstream loans unavailable on a non-warrantable unit. A smaller buyer pool can make a later sale harder, and that risk grows when you take on more debt.
- A building that could worsen. A new assessment, lawsuit or insurance problem can hit the review after you borrow.
- Eating your own qualifying assets. Spending cash from other accounts to prepare for the loan can shrink what qualifies, because the new cash cannot replace it.
The better question is often the order of operations. Qualify on the assets you hold today, then decide what the cash is for. If rent does not cover the payment, or you would rather not document income, qualifying on assets is an option. The trade-off is that every account must be documented with statements.
Frequently Asked Questions
Can I use privately held company stock to qualify?
No. If you sold your company or received a buyout, the proceeds are the documented route. Once the money sits in a regulated account and meets the seasoning rules, it counts at 100% if held as cash.
Can I use the cash from the refinance as my reserves or qualifying assets?
No. Your assets must qualify you before the new loan funds. Some other loan types allow proceeds toward reserves, so do not mix up programs.
What if my condo is owned free and clear?
Free and clear is the simplest case, because no payoff comes out. On the asset depletion path, the cash is up to 60% of the appraised value minus closing costs, subject to underwriting and the building review. The loan must still fall within the $125,000 to $3,500,000 range and meet the asset minimums.
Does an investment condo get less cash than a primary residence?
Not on the published ceiling. On the asset depletion path, the cash-out cap is 60% for a principal residence, a second home and an investment property. Leverage on a purchase or rate-and-term refinance does differ by use, so ask the lender how it applies to your property.
Will the building label stop the loan entirely?
The label does not by itself end eligibility, and the lender’s review decides how it affects leverage and loan size. Still, a building with serious problems may fail the project review. A condotel gets tighter treatment. Ask for a review of the specific project before you rely on any figure.
Your 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. Reach the team at 828-256-2183 or request a quote. Consumer mortgage lending is licensed in 16 states: Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia and Washington. Programs change, every file is underwritten individually, and nothing here is a commitment to lend.
For a side-by-side with another route, see Lendmire’s piece on bank statement versus asset-based cash-out refinance on a non-warrantable condo.
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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References
1. Community Associations Institute (CAI) advocacy
2. Fannie Mae lender letter on project standards and insurance requirements
3. Michigan Community Association Law Blog
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How to Qualify and Apply for an Asset-Based Cash-Out Refinance on a Non-Warrantable Condo · How Much Cash Comes Out of an Asset-Based Cash-Out Refinance With Six Months of Reserves? · Asset-Based Cash-Out Refinance Lenders on a Condo
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Important disclosures. Lendmire (NMLS# 2371349) is a licensed mortgage brokerage. Lendmire is not a direct lender, depository institution, or financial advisor. All loan inquiries are subject to lender underwriting; this article does not constitute a commitment to lend. Rates, terms, and program guidelines are subject to change without notice and vary by borrower profile, property type, and state. Information in this article is general in nature and is not financial, legal, or tax advice. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.