The Quick Read: Yes, you can, but only on the asset depletion path, where your verified assets are divided by 60 months into qualifying income that must carry the housing payment and your other debts, subject to underwriting, because the asset qualifier path, which covers the whole loan with assets alone, is not offered on investment property. For many rentals, a DSCR loan is the simpler fit. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines.
- On the asset depletion path, an investment property purchase or rate-and-term refinance goes up to 65% loan-to-value, and a cash-out refinance goes up to 60%, through select programs.
- Usable assets, after haircuts by account type, divided by 60 months become your monthly qualifying income.
- You typically need qualified assets of at least the lesser of $1,000,000 or 1.25 times the loan, and never below $250,000 liquid if assets are your only income source.
- Strong rent and a modest portfolio usually point to DSCR. Thin rent and a large portfolio point to asset depletion.
- The program figures are the same for a Washington borrower as anywhere else. Every file is underwritten individually.
Key Terms Defined
Asset depletion: a way of qualifying where the lender turns your eligible assets into a monthly income figure, then tests that income against your debts.
Asset qualifier: a way of qualifying where eligible assets must equal or exceed the entire loan amount, and no income is documented.
Haircut: the discount a lender applies to an asset type, so only a share of the balance counts.
Seasoning: how long funds must sit in your accounts, shown on statements, before the lender will count them.
Debt-to-income (DTI): your monthly debts divided by your monthly income, including the housing payment on the new loan.
DSCR (debt service coverage ratio): the property’s monthly rent divided by its full monthly obligation: principal, interest, taxes, insurance, and any HOA dues.
Which Path Works on a Rental?
Only the asset depletion path works on a rental. A borrower is qualified on one path at a time, and the asset qualifier path is limited to principal residences and second homes. Investment property, including a Washington rental, belongs to the depletion path.
Here is how the two paths compare:
| Feature | Asset qualifier path | Asset depletion path |
|---|---|---|
| Investment property | Not offered | Offered |
| How you qualify | Assets cover the whole loan | Assets become monthly income |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Purchase leverage | Up to 80% (primary or second home) | Up to 65% on investment property |
| Statements | Two months per account | One 120+ days old, one within 45 days |
All figures are ceilings and floors through select programs, subject to underwriting, never offers.
On the depletion path, an investment property goes up to 65% loan-to-value on a purchase or rate-and-term refinance, and up to 60% on a cash-out refinance. Loans run from $125,000 to $3,500,000.
Credit follows the lender’s score and loan-amount matrix. Housing history is typically 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 four years of seasoning.
How the Asset Depletion Math Works
The lender counts a share of each account, adds the shares, and divides by 60 months. The result is a monthly qualifying income that has to carry the full housing payment and your other debts through the debt-to-income test. The share depends on the asset type:
| Asset type (depletion path) | Share that counts |
|---|---|
| Cash accounts | 100% |
| Certificates of deposit | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts | 70% at any age |
| Real-estate equity | 60% |
Run one illustration. Say you hold $1,500,000 in securities and $300,000 in cash. The securities count at 80%, or $1,200,000. The cash counts at 100%, or $300,000. That is $1,500,000 of usable assets. Divided by 60 months, it produces $25,000 of monthly qualifying income. That figure then has to carry the housing payment and other debts through the debt-to-income test. The lender’s own calculation governs, and this example is illustrative only.
Two things surprise people. A large balance sheet can still produce a modest income figure, because the haircuts and the 60-month divisor shrink it. Divisors also vary widely between programs in the market, so a number you saw elsewhere may not match this one.
The program carries minimums too. Qualified assets typically must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When asset depletion is your only income source, you also need at least $250,000 liquid. If you have documented income, asset-derived income can supplement it up to a 45% debt-to-income ratio, and the minimum-assets rule is waived.
One more point: no income documentation never means no documentation. Your assets are fully documented on both paths. The depletion path wants 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.
The asset qualifier path has its own credit percentages. It counts 401(k) and IRA balances at 90% under age 59½ and 100% at 59½ or older. That path does not apply to a rental, so do not borrow its percentages when you plan a rental purchase.
What Assets Do Not Count
Several popular holdings are not published as eligible on either path. Cryptocurrency, precious metals, collectibles, and pledged or borrowed funds are in that group. So are business accounts beyond your ownership share.
On the depletion path, these are not eligible at all:
- Custodial accounts
- Deferred compensation
- Escrow accounts
- Foreign funds
- Cash on hand
- Stock options
- Non-vested restricted stock units
- Funds from non-regulated financial companies
The documented route is to convert eligible holdings into a seasoned cash balance in a regulated account. The lender then reviews the source of those funds. If most of your wealth sits in crypto or metals, plan that conversion well before you apply, and expect the cash to need time on deposit.
Asset Depletion vs. DSCR for a Rental
DSCR tests the house, and asset depletion tests you. That one distinction decides most cases. Across Lendmire’s wholesale network, the depletion path is a fallback when the rent is too thin to carry the payment on its own.
| Factor | Asset depletion | DSCR loan |
|---|---|---|
| What is tested | Your assets, turned into income | The property’s rent vs. its payment |
| Debt-to-income | Part of the test | Not the basis |
| Your portfolio’s role | Becomes income | Serves as reserves |
| Vesting | Typically personal | LLC possible, per program terms |
| Growing a portfolio | Same asset pool for each loan | Each property stands on its rent |
DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. That label is not automatic, though. The CFPB’s commentary on business-purpose credit says the lender must decide primary purpose in each case. Doss Law’s guide to the business-purpose exemption gives a rental cash-out refinance used to pay personal obligations as a loan that falls outside the exemption.
Neither route skips the borrower entirely. DSCR lenders still review credit and reserves. Asset-based lending also isn’t a free pass. CFS Review’s analysis of non-QM lending explains that even a lender relying only on assets must consider and verify debt-to-income or residual income. That is why the depletion path runs through a DTI test.
What if the rent falls short? Programs below 1.00 coverage are available through select lenders in the network, but loan-to-value and terms adjust. That can keep a DSCR file alive when asset depletion would swallow too much of your portfolio.
Which Path Fits You?
Match the path to the rent and the balance sheet:
- Strong rent, modest portfolio: DSCR. The property carries itself, and your savings stay intact as reserves.
- Thin rent, large portfolio: asset depletion. High-priced Washington markets, where rent often runs thin against price, are the classic setting. A large portfolio can carry the payment even when the rent cannot.
- Both work: compare them on cost, flexibility, and what each does to your reserves. Asset depletion counts your portfolio as income, so it has to stay on deposit and verified.
- Some documented income plus assets: the depletion path lets asset-derived income supplement that income up to a 45% debt-to-income ratio.
Think about future purchases as well. Each depletion-path loan draws on the same pool of assets. A DSCR loan judges each new property on its own rent, so it scales more easily across several rentals.
If you plan to run the property as a short-term rental, projected rent will not replace the asset-derived income the depletion path tests. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income.
Washington Notes
The program figures do not change by state. Lendmire is a mortgage broker, and its consumer mortgage lending is licensed in 16 states, Washington among them. It arranges asset-based mortgages through select lenders in its network. Washington facts, like local prices and insurance costs, shape the deal. They do not change the program parameters.
If you want to hold title in an LLC, the depletion path typically uses personal vesting. Entity borrowing fits DSCR better, subject to lender program eligibility.
Mistakes That Derail Files
Across the network, these are the problems that most often stall a depletion-path file:
- Moving money mid-file. Transfers between accounts can break seasoning or muddy the source of funds. Keep your statements clean.
- Counting retirement money at full value. On the depletion path, retirement accounts count at 70% at any age.
- Counting cash-out proceeds as assets. Cash-out proceeds never count as qualifying assets.
- Assuming an investor profile you lack. A first-time investor on the depletion path needs a 700 score.
- Using borrowed or pledged funds. These are not published as eligible.
- Expecting DSCR to ignore your credit. Credit and reserves still matter.
Frequently Asked Questions
Can I use my 401(k) or IRA to qualify for a rental purchase?
Yes, on the asset depletion path, where retirement accounts count at 70% at any age. The asset qualifier path counts them at 90% under age 59½ and 100% at 59½ or older, but that path does not cover investment property. The calculation measures your capacity to carry the loan. Funds you bring to closing still come out of your balances.
How much do I need in assets?
On the asset depletion path, qualified assets typically must be at least the lesser of $1,000,000 or 1.25 times the loan balance. If assets are your only income source, you need at least $250,000 liquid. When asset-derived income only supplements documented income, the minimum-assets rule is waived.
Does rent from the new property count toward qualifying?
The depletion path is reviewed around income derived from your assets, tested against the housing payment and your other debts. Whether any projected rent offsets the payment depends on the lender and program, so ask before you assume it. If the rent is what makes the deal work, a DSCR loan is usually the cleaner route.
Can I buy the rental in an LLC?
On the depletion path, a consumer-purpose loan, personal vesting is typical. LLC borrowing fits DSCR loans better, subject to lender program eligibility. If an LLC matters to you, that often tips the choice toward DSCR.
What if most of my wealth is in crypto or precious metals?
Neither is published as eligible on either path. The documented route is to convert them into a seasoned cash balance in a regulated account, with the source reviewed by the lender. Start early so the funds season before you apply.
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. Programs change. This is not a commitment to lend.
Lendmire’s asset-based mortgage in Washington page presents the program for Washington borrowers.
About Lendmire
Lendmire — NMLS# 2371349 — is a mortgage broker that arranges bank statement, P&L-only, 1099-only and asset-based home financing in 16 states through wholesale lenders, on primary residences, second homes and investment properties. Every option is subject to the lender’s guidelines and full underwriting. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
Get Started
Ready to find the right loan for you?
In about 30 seconds you can review financing options available for your home or investment property. No commitment required.
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. CFPB, Regulation Z §1026.3 and commentary
2. Doss Law, Business Purpose Exemption Simplified
3. CFS Review, CFPB addresses non-QMs under the ability-to-repay rule
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 Buy Before You Sell in Alabama Using an Asset Qualifier Mortgage · How Much Can You Cash Out of a Rental Property on an Asset Depletion Loan? · How Much of a Brokerage Account Counts Toward Asset Depletion Income?
Guides: Asset-Based Mortgage in Washington
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
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.