Asset Depletion Mortgages In New Mexico — The Quick Read: An asset depletion mortgage lets a borrower qualify using liquid savings and investments instead of pay stubs or traditional personal-income documentation. A lender turns a portion of that balance into a monthly “income” figure, then underwrites the loan against that number. New Mexico is one of the 16 states where Lendmire’s consumer mortgage lending is licensed, so this explainer covers the mechanics nationally, not local pricing or availability. Retirees, business sellers, and high-net-worth borrowers with irregular income are the typical fit.
Lendmire offers consumer mortgage lending in Alabama, California, Colorado, Florida, Georgia, Indiana, Michigan, Montana, New Mexico, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia, and Washington. None of this is state-specific. The underwriting method works the same wherever Lendmire is licensed. Every figure comes from Lendmire’s own wholesale-network guidelines, not a national average.
Key Terms Defined
Asset depletion (also called asset dissipation) is an underwriting method that converts a borrower’s liquid assets into a monthly income figure for loan qualification.
Haircut (or discount) is the percentage reduction a lender applies to an asset’s value before counting it, based on how volatile or hard to access that asset is.
Divisor is the number of months a lender divides eligible assets by to produce the monthly qualifying-income figure — a shorter divisor produces a bigger monthly number from the same pile of money.
Liquid assets are funds a borrower can access without selling a business or a piece of real estate — checking, savings, brokerage accounts, and retirement accounts, generally.
Debt-to-income ratio (DTI) compares a borrower’s monthly debt obligations to monthly qualifying income, including the imputed figure from asset depletion.
Reserves are months of housing payments a borrower must have left over, in liquid form, after closing.
What This Product Actually Solves
Here’s the short version before the mechanics: asset depletion exists for people whose net worth doesn’t show up on a tax return.
- It qualifies a borrower on a documented balance sheet, not W-2s or 1099s.
- It’s built for primary residences and second homes — not rental purchases.
- Two qualification paths exist inside the same underwriting family: asset allowance and assets-only.
- Loan sizes across Lendmire’s wholesale network run from $300,000 to $30,000,000, split across two separate programs with different leverage ladders.
- Retirement accounts, gifts, business funds, and cryptocurrency get treated very differently from cash — some don’t count at all.
A retiree living off a brokerage account, a founder who just sold a company, or a physician with heavy write-offs on paper all have thin taxable income relative to real net worth. Traditional underwriting punishes that mismatch. Asset depletion is the fix built specifically for it.
How the Math Actually Works, Step by Step
The process runs in a fixed order, and skipping a step changes the answer.
Step one: inventory eligible assets. Checking, savings, CDs, money-market funds, and brokerage accounts count. Business operating accounts, unvested stock, cryptocurrency, and most trust structures other than a revocable living trust do not count in Lendmire’s network.
Step two: apply the haircut. Cash counts close to full value. Retirement accounts count at 70% of value under age 59½, and jump to 80% once the borrower clears that age — a hard line tied to when penalty-free withdrawals become available, not a judgment call.
Step three: subtract committed funds. Whatever’s earmarked for the down payment, closing costs, or required reserves comes out of the eligible pool first. That money can’t double as both a funding source and an income source.
Step four: divide by the term. Lendmire’s network runs three divisor options — 36 months, 60 months, or 84 months — and the choice depends on how the asset income is being used and the loan size. A shorter divisor produces a bigger monthly qualifying figure from the same balance.
Step five: run it through DTI. The resulting monthly figure gets treated like any other documented income and can stack with Social Security, pension income, or other verified sources, up to a 50% debt-to-income ceiling on most files.
No federal formula dictates any of these steps. The OCC Bulletin 2019-36 tells banks that asset dissipation underwriting needs a documented internal policy. That policy must cover eligible assets, discount methodology, and verification. But the bulletin deliberately stops short of naming a required divisor or haircut percentage. That’s why two lenders looking at the same brokerage statement can land on two different qualifying numbers. Moody’s Analytics makes this same point in its summary of the guidance.
The Two Paths: Asset Allowance vs. Assets-Only
Asset allowance divides net eligible liquid assets by 36 or 60 months when it’s supplementing other income, or by 84 months when it stands alone or the loan tops $3,500,000. It runs to 80% loan-to-value and applies to primary and second homes only.
Assets-only skips the DTI calculation entirely. A borrower needs U.S. liquid assets equal to the loan amount, plus closing costs, plus 60 months of any documented net loss on other residential property they own. No income figure gets calculated at all — the assets simply have to be there.
Both paths exclude the same categories: business funds, gifts, trusts other than a revocable living trust, unvested stock, and cryptocurrency never count toward either calculation. That trips up more borrowers than the divisor math does — a recent inheritance sitting as a gift, or founder equity that hasn’t vested, looks like real wealth on paper but doesn’t move the coverage figure at all.
Sizing and Leverage: What the Ladder Actually Looks Like
Loan sizes through Lendmire’s wholesale network split across two programs. A portfolio non-QM program carries files to $6,000,000. A separate bank portfolio program picks up twelve-month-statement files and carries them to $30,000,000 on its own leverage ladder — 65% to $5,000,000, 60% to $10,000,000, and 55% up to $30,000,000, with interest-only capped at 60% or the band’s ceiling, whichever is lower.
On a primary residence, leverage steps down as the loan gets bigger. Files up to $1,000,000 can run as high as 90%. That ceiling drops to 85% up to $1,500,000, then to 80% through the $2,000,000 to $2,500,000 range, and down again from there as size climbs — every step reviewed against credit and reserves, never a flat number applied blindly. Second homes and investment properties typically run about five points lower than the primary-residence figure at each size tier.
Above $4,000,000, every file goes through case-by-case review before it’s even submitted. This isn’t a soft caveat — it’s how the program actually works at that size. It applies whether the borrower is using traditional personal-income documentation, bank statements, or asset depletion to qualify.
Reserve requirements scale with loan size: typically three months of payments up to $500,000, six months up to $1,500,000, and nine months above that, plus two additional months for each other financed property a borrower holds, capped at twelve months. First-time real estate investors are generally held to a full twelve months regardless of loan size.
Credit requirements follow a similar step pattern. The floor is 660 on the portfolio program, 680 on the bank program, and 700 once a file crosses into super-jumbo territory above $3,500,000 on a primary residence or $3,000,000 on a second home or investment property. Those super-jumbo files also carry tighter overlays. Lenders want a clean 24-month payment history, 48 months of seasoning past any credit event, and no non-occupant co-borrowers. Exact terms depend on lender and investor guidelines, credit profile, reserves, and property review.
Where the General Rule Breaks
Four situations bend the standard playbook.
The 59½ line is fixed, not judged. Every other haircut in this system reflects a lender’s read on volatility or liquidity. The retirement-account jump from 70% to 80% is different — it’s tied to a specific statutory age, not a market opinion, and it doesn’t move regardless of how the account is invested.
Rate-of-return assumptions vary by lender. Some programs assume a pile of assets simply gets spent down to zero over the divisor period. Others assume continued growth on the balance, which changes how much starting capital a borrower actually needs. Neither approach is required by regulation — the OCC bulletin leaves the choice to the bank’s own policy.
Above $4,000,000, nothing is automatic. The published leverage ladder still applies as a ceiling, but every file at that size goes through individual review before it’s submitted anywhere. Treat any number above that threshold as a starting point for a conversation, not a guarantee.
Cash-out has its own cap. On the portfolio program, cash-out proceeds run uncapped at or below 60% loan-to-value, but above that threshold, cash-in-hand is limited to $1,500,000. The bank program doesn’t publish a comparable cap, but every cash-out file still gets full underwriting review.
Why Rental Property Purchases Usually Pivot to DSCR
Asset depletion is built for a home you or a family member will live in — it doesn’t apply to a straight rental purchase in Lendmire’s network. That’s not a technicality; it’s the core design of the product.
Investment properties get qualified differently. A DSCR loan qualifies primarily on the property’s rental income covering the monthly payment, subject to lender guidelines. It doesn’t rely on the borrower’s personal balance sheet or traditional personal-income documentation. Sometimes a rental deal doesn’t cash-flow well enough on its own to qualify. In that case, some investors use their asset depth to strengthen reserves on the DSCR file instead. That’s better than trying to force an asset-depletion calculation onto a property that isn’t eligible for it. DSCR loans are business-purpose investor loans, so they’re reviewed differently from an owner-occupied mortgage.
Investors often weigh the difference between DSCR qualification and other no-income-documentation paths. The split makes sense once you separate the two questions each one answers. Asset depletion asks: can this borrower personally afford a home payment? DSCR asks: does this specific property generate enough rent to cover its own payment? They’re different tools for different problems. It’s common to combine a strong personal balance sheet with a DSCR-qualified rental purchase. The reserves from one can support the other.
The Investor Decision in Practice
A borrower buying a primary residence or vacation property with a thin income tax profile but real liquid net worth is the clean fit for asset depletion. Take a retiree with a substantial brokerage account and modest pension income, for example. They can often stack the pension with an asset-derived figure to reach a qualifying DTI without touching principal at all.
The decision gets more nuanced for someone straddling both a personal purchase and a rental acquisition. In that case, it often makes sense to route the primary or second home through asset depletion and keep the rental purchase on a DSCR track. This preserves liquid reserves rather than spreading them thin trying to make one product do two jobs. Other guides in Lendmire’s own coverage of asset-based purchases in different markets walk through similar borrower profiles. In these cases, the split between personal and investment financing matters just as much as the underlying math.
Tax treatment can depend on how the funds are used and how the property is held, so investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Reach Lendmire at 828-256-2183 to walk through which asset accounts count, which divisor fits a specific loan size, and how the leverage ladder applies to a particular purchase. Review details are always subject to lender overlays and full underwriting review.
Frequently Asked Questions
Do I have to sell my investments to use them for qualification?
No. The lender documents that the balance exists and that it’s accessible — it’s a math exercise for qualifying income, not a withdrawal requirement. Borrowers keep their assets invested and simply demonstrate ownership and access through statements.
Can I combine asset depletion with other income like Social Security or a pension?
Yes, in most cases. The imputed monthly figure from assets typically stacks with other documented income sources to reach the qualifying total, which often means less of the asset pool needs to be counted to clear the DTI threshold.
Why do some lenders divide by 36 months and others by 84?
There’s no regulatory divisor requirement — each program sets its own. In Lendmire’s network, the choice depends on whether the asset income is supplementing other documented income (36 or 60 months) or standing entirely on its own (84 months, or automatically for any loan above $3,500,000).
Does my retirement account count the same as my brokerage account?
No. Retirement funds carry a steeper discount — typically 70% of value before age 59½, moving to 80% once penalty-free withdrawals become available. Brokerage and cash accounts are treated on a different, generally more favorable, basis.
Can I use this program to buy a rental property?
Generally not directly — asset depletion in Lendmire’s network applies to primary residences and second homes, not investment properties. Rental purchases typically qualify through a DSCR loan instead, based on the property’s own rental income rather than the borrower’s personal assets.
If you’re weighing a purchase where the numbers on paper don’t match your actual net worth, Lendmire can help compare asset-based and property-cash-flow options side by side based on the specific accounts, credit profile, and leverage a file needs.
For current guidelines and terms, see Lendmire’s super jumbo bank statement loan programs page.
Self-employed borrowers can compare both super jumbo programs on Lendmire’s self-employed mortgages page.
About Lendmire
Lendmire is a DSCR-focused mortgage brokerage, NMLS# 2371349, placing investor loans across 40 markets, including Washington, D.C. DSCR eligibility is generally reviewed by the lender around a property’s rental income rather than personal income documentation, which fits LLC-held rentals, self-employed investors, and portfolios scaling past conventional financed-property limits. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
2. Moody’s Analytics summary of OCC Bulletin 2019-36
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
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Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.
