The Quick Read: The best program for your situation is the one that fits your assets, your trust type, and how much cash you want out, because a revocable living trust changes the paperwork on an asset-based cash-out refinance but not how the underwriting math works. Programs placed through select lenders in Lendmire’s wholesale network qualify you on documented assets, not on paychecks, subject to underwriting.
- A revocable living trust is the easy case. Irrevocable and layered structures are narrower and need a closer look.
- The asset depletion path is the one that allows cash-out at 60% loan-to-value on a principal residence, a second home, or an investment property, subject to lender guidelines.
- Cash-out proceeds never count as qualifying assets on the depletion path.
- You document assets with statements. You skip traditional personal-income documentation, pay stubs, and employment verification.
- Whether you must deed the home out of the trust is usually a title-company question, not a legal one.
What an Asset-Based Cash-Out Refinance Actually Is
An asset-based cash-out refinance replaces your current mortgage with a larger one and hands you the difference, while the lender reviews your file on what you own instead of what you earn. Every file is still fully underwritten. The assets are documented with statements, and the lender reviews credit, the property, and title like any other loan.
This suits a specific reader: someone with large balances and small documented income. Think retirees, people who sold a business, heirs, recipients of a settlement, early-retired professionals, and households living off a portfolio. A conventional lender looks at your tax return, sees little income, and stops there. An asset-based program looks at your brokerage statements and keeps going.
Lendmire is a mortgage broker, not a lender. Its asset-based mortgage programs are placed through select lenders in its network. Lendmire’s 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. Everything below applies to those states only.
Which of the Two Paths Fits You?
The two paths work differently, and you qualify on one at a time. Mixing them up is a common mistake in this corner of the market, so the table keeps them separate.
| Factor | Asset Qualifier Path | Asset Depletion Path |
|---|---|---|
| How assets are used | Cover the whole loan | Become monthly income |
| Income documented | None | Derived from assets |
| Property types | Primary home, second home | Primary, second home, investment |
| Purchase leverage | Up to 80% | Up to 80% (65% investment) |
| Refinance leverage | Up to 75% | Up to 80% rate-and-term |
| Cash-out leverage | Set by lender, not published | 60% on all occupancies |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
All figures are typical ceilings through select programs, subject to underwriting. They are not offers.
On the asset qualifier path, your eligible assets, after the credit percentages, must equal or exceed the entire loan amount. No employment or income is documented. The path has a published 600 minimum credit score and a 0x30x12 housing history. One 30-day late payment in the last twelve months is considered case by case. Whether a given lender allows cash-out on this path, and at what leverage, is the lender’s call and is not published. Treat any qualifier-path cash-out conversation as a question for the file, not a promise.
On the asset depletion path, the lender adds up your usable assets, divides by 60 months, and treats the result as monthly income. That income then carries your housing payment and other debts through a debt-to-income test. This is the path with published cash-out leverage: up to 60% loan-to-value on a principal residence, second home, or investment property. Credit follows the lender’s score and loan-amount matrix.
How Underwriting Treats a Living Trust, Step by Step
A trust decides whether a program will accept the file. It does not decide how large the loan can be. Here is how a trust-held file moves, in order.
1. Confirm the trust is revocable. On most files, lenders accept a revocable living trust where you are the trustee and can borrow against the property. The trustee must hold that power in writing.
2. Check the deed. The recorded deed must show the trustee holding title, and the name must match the trust exactly. A mismatch between the deed and the trust name is a common snag, and fixing it before you apply costs less than fixing it mid-file.
3. Gather the trust paperwork. A certification of trust is the usual shortcut. It is a short document confirming that the trust exists and who may sign for it. An estate-planning firm describes the same practice: most lenders accept the certification, and the title company checks that the trustee can pledge the property. Some parties still ask for the full trust agreement.
4. Document the assets. On the qualifier path, expect 60 days of seasoning and two months of statements for each qualifying account. On the depletion path, expect statements at least 120 days old at application, plus the most recent statement within 45 days. Funds from the sale of a business, an inheritance, or a legal settlement are excused from that seasoning.
5. Run the path math. The lender applies the credit percentages or haircuts, then tests the loan against your assets or your derived income.
6. Order title. The title insurer must be willing to insure the lender’s lien on the home without trust-related exceptions.
7. Close with the trustee signing as trustee. The old mortgage is paid off from the new loan’s proceeds, and the remainder comes to you.
Rules and documents vary from one lender in the network to the next. Some want the full agreement and others accept the certification, so ask which one before you order anything.
Two Roles a Trust Can Play
A trust can hold your assets, your home, or both. Lenders review those roles separately, and most competing explanations blur them.
| Role | What the lender reviews | Common stumbling block |
|---|---|---|
| Trust holds the home | Deed, vesting, trustee power | Name mismatch on the deed |
| Trust holds the accounts | Statements, your access and control | Accounts titled to the trust, not you |
| Trust holds both | All of the above | Co-trustee signing rules |
When a trust holds the accounts, the lender asks whether you control the money. A revocable trust where you are the grantor and trustee usually reads as your own funds, subject to program review. An irrevocable trust is different, because you have given up control. Lenders often decline to count those balances, or they ask for more proof of access.
Look at the asset type as well as the title. Privately held company stock is not an eligible asset on either path, even if it sits inside your trust. Neither are cryptocurrency, precious metals, or collectibles, which are not published as eligible. If you own them, the documented route is converting them to a seasoned cash balance in a regulated account. The lender then reviews the source of those funds.
Deed Out and Back, or Close in the Trust?
Most borrowers do not need to remove the home from the trust to refinance. A law firm’s estate-planning guide says there is generally no legal reason to take the property out. It adds that some lenders and title companies still ask for it, and that you should confirm title is still in the trust after closing.
| Option | Upside | Downside |
|---|---|---|
| Close in the trust | No retitling, estate plan intact | Needs trust review on every file |
| Deed out, refinance, deed back | Simple for a title company | Retitling cost, estate-plan gaps |
If a title company insists on retitling, call your estate attorney first. A deed out of the trust and a missed deed back in is how a home ends up in probate despite your plan.
There is also a due-on-sale wrinkle if you move title before the refinance. Federal law blocks a lender from calling a loan due when you transfer a home into your own living trust. A law-firm explainer notes that this protection is written around residential property, with the borrower remaining a beneficiary. A legal reference adds that the implementing regulation goes further and requires the borrower to remain the occupant. So a rental is not safely covered. Moving title at the new loan’s closing sidesteps the issue, because the old loan is paid off at that moment.
Where the Rule Breaks: Trust Types and Edge Cases
The general rule is that a revocable trust works and everything else needs a closer look. Here is where it bends.
Irrevocable trusts. Acceptance is narrower and depends on the trustee’s power to pledge the property. Talk to an estate attorney before you move any title out of an irrevocable trust.
A trust that turns irrevocable at death. A married couple’s joint trust is often revocable while both spouses live. Once one spouse dies, parts can become irrevocable, which changes how a lender reads it. Tell the broker up front.
Land trusts and “family trust” labels. A family trust is a nickname, not a legal category. The lender wants to know whether it is revocable and who controls it.
A trust that owns an LLC. This layered structure needs both layers documented. The usual snag is an authority gap between the trustee and the LLC manager.
Borrower identity. Some programs lend to the trustee. Others want the loan made to the individual, with the trust shown as owner. The program decides, and that is one reason a broker who sees many lenders’ guidelines matters.
Mixed-use cash. Cash-out used to buy or improve a non-owner-occupied rental is business-purpose credit, as the CFPB’s Truth in Lending exam procedures describe. Because business-purpose investor loans are reviewed differently from a standard owner-occupied mortgage, how you plan to use the money should be settled before you apply. If the cash is meant for personal spending out of an investment property, ask counsel first.
Choosing the Best Program for Your Situation
No single program wins for everyone. The right fit depends on your assets, your trust, the property, and how much cash you need. Here is how the routes compare.
| Route | Best if | Not a fit if |
|---|---|---|
| Asset qualifier path | Your assets cover the whole loan | You need a published cash-out figure |
| Asset depletion path | You want cash-out, or own a rental | Your liquid assets fall below the minimums |
| Conventional cash-out | You have W-2 or tax-return income | Your documented income is small |
| Bank statement program | You document income with deposits | You have no business deposit history |
| Home equity line | You want a small, flexible draw | Your trust is irrevocable or LLC-titled |
| Rental-income loan (DSCR) | The home is a pure rental | You want to qualify on assets |
The depletion path has real minimums. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance, and never below $250,000 liquid when depletion is your only income source. If asset-derived income supplements documented income, up to a 45% debt-to-income ratio, that minimum is waived. A first-time investor on this path needs a 700 credit score. Multiple bankruptcies are not eligible, and a housing event needs four years of seasoning. Terms vary by lender guidelines, property type, leverage, credit profile, and full file review.
Ask any broker or lender these five questions before you pay for an appraisal:
- Does this program accept my trust type, and will it take a certification of trust?
- Is the loan made to me, to the trustee, or to an LLC?
- Do my specific accounts count, and at what percentage?
- What is the cash-out leverage on my occupancy type?
- What does title require, and does anyone insist on retitling?
A Worked Example
These numbers are illustrative, and the lender’s own calculation governs.
Picture a couple holding a rental property in their joint revocable trust. They have $1,500,000 in securities and $300,000 in cash, and almost no documented income. On the asset depletion path, the securities count at 80%, which is $1,200,000. The cash counts at 100%, which is $300,000. That is $1,500,000 of usable assets, and divided by 60 months it gives $25,000 of monthly qualifying income.
That derived income then carries the new housing payment and their other debts through the debt-to-income test. Cash-out on the rental caps at 60% loan-to-value on the depletion path. The cash they take out never counts as qualifying assets.
Compare the qualifier path for a different borrower with an $800,000 loan. Their $330,000 in brokerage accounts counts at 100%. Their $300,000 401(k), held under age 59½, counts at 90%, which is $270,000. Their $200,000 in savings counts at 100%. Together that is $800,000 of usable assets, enough to cover the loan on assets alone. This borrower documents no income, but lender approval still follows underwriting. Because qualifier-path cash-out leverage is set lender by lender, this borrower would confirm that first.
In both cases the trust shows up in the paperwork: the certification, the deed, and the title commitment. It does not change either calculation.
Common Mistakes and Myths
- A trust waives waiting periods. It does not. Account seasoning and any property-seasoning policy apply the same way, and the lender sets the property rules.
- Any account titled to the trust counts. Control and eligibility decide it, and irrevocable-trust balances often do not count.
- The trust is the same as an LLC. A trust is an estate-planning tool, while an LLC is a business entity. The lender documents each differently.
- Deeding out is always required. It is often a title-company preference, not a legal need.
- Cash-out proceeds help me qualify. They do not on the depletion path.
- No traditional personal-income documentation means no documentation. You still provide statements, credit, title, and an appraisal, and the lender underwrites the file.
Key Terms Defined
Revocable living trust: A trust you can change or cancel while you are alive, usually with you as trustee.
Certification of trust: A short document confirming the trust exists and naming who may sign for it.
Vesting: How title to the property is held, as shown on the recorded deed.
Seasoning: The age a lender requires of your funds or your ownership before it counts them.
Asset depletion: Dividing usable assets by 60 months to create monthly qualifying income.
Cash-out refinance: A new, larger mortgage that pays off the old one and gives you the difference.
A Note Before You Act
This article is general information, not legal or tax advice. Trust law, title practice, and tax treatment vary by state and by your circumstances. Speak with an estate attorney or CPA before you retitle a home or use cash-out proceeds.
Frequently Asked Questions
Do I have to remove my home from my living trust to refinance?
Usually not. Some lenders and title companies still ask for it. If yours does, call your estate attorney before signing a new deed, and confirm afterward that title is still in the trust.
Do my trust-held accounts count as my assets?
Often yes, if the trust is revocable and you control the accounts, subject to the lender’s review. The lender typically wants the trust paperwork and statements showing your access. Irrevocable-trust balances are harder to use. Privately held company stock is not an eligible asset on either path, wherever it is held.
Does the trust change how much I can borrow?
No. Loan size comes from the leverage cap and the path math, not from the trust. On the depletion path, cash-out tops out at 60% loan-to-value, subject to underwriting. The trust decides whether a program accepts the file.
What if my trust is irrevocable?
Expect a narrower set of programs and extra review of the trustee’s power to pledge the property. Some files are declined outright. An estate attorney can tell you whether moving title is wise before anything is signed.
Can I use this on a rental property?
Yes, but only on the asset depletion path, where investment property is eligible at up to 60% on a cash-out. The qualifier path covers principal residences and second homes. If you want to qualify on the rent instead of your assets, a rental-income loan is the separate route.
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.
For how equity extraction works on an investment property, see 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. Cutler Riley, using a trust to qualify for a mortgage
2. Bethel Law, is your property still in your trust
3. Foust & Foust, due-on-sale exceptions
4. FedLaws, Garn–St Germain due-on-sale triggers and exceptions
5. CFPB, Truth in Lending Act examination procedures
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 to Fund Large Philanthropic Gifts · Best Asset-Based Cash-Out Refinance Program With No Income Other Than Assets
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.