The Quick Read: It depends on the path you qualify on and how you will use the home: through select programs, an Indiana primary residence or second home can take cash out on the asset depletion path at up to 60% loan-to-value, while a rental can too, at the same 60% ceiling, subject to underwriting. The cash you pull out never counts toward qualifying. Nothing about the program changes at the Indiana state line.
- Two paths exist. One covers the whole loan with assets. The other turns assets into monthly income. You use one at a time.
- Cash-out is a depletion-path feature. On the asset qualifier path, cash-out terms are set by the lender and are not published.
- Leverage drops on cash-out. The depletion path allows 80% on a purchase or rate-and-term refinance of a primary residence or second home, but only 60% on a cash-out.
- Your home’s equity is not the asset pool. Statements for other accounts are.
- Rentals are a separate conversation. Many investors are better served by a loan that reads the lease.
What Is an Asset Depletion Refinance, Really?
It is a way of qualifying, not a way of spending. Nothing gets sold, drained, or pledged. A lender looks at your verified balances and decides how much of them can carry the loan.
Across the lenders in Lendmire’s network, that happens two ways.
The asset qualifier path covers the loan with assets alone. After each account’s credit percentage, your eligible assets must equal or exceed the entire loan amount. No employment or income is documented.
The asset depletion path turns assets into income. Usable assets are divided by 60 months. The result is a monthly qualifying income that must carry the full housing payment and your other debts through the debt-to-income test.
Here is the depletion math, as an illustration only. Say you hold $1,500,000 in securities and $300,000 in cash. Securities count at 80%, so they add $1,200,000. Cash counts at 100%, adding $300,000. That is $1,500,000 usable, divided by 60 months, which gives $25,000 of monthly qualifying income. That income then has to carry the new housing payment and your other debts. The lender’s own calculation governs, subject to underwriting.
Asset-based does not mean undocumented. Your statements are reviewed on both paths. Only the income paperwork goes away.
Which Path Allows Cash Out?
The depletion path publishes cash-out leverage. The qualifier path does not.
On the qualifier path, leverage runs up to 75% on a refinance of a principal residence or second home. Whether cash-out proceeds are allowed there, and at what leverage, is the lender’s call. Ask before assuming.
| Factor | Asset Qualifier Path | Asset Depletion Path |
|---|---|---|
| How assets are used | Must cover the whole loan | Become monthly income |
| Occupancy | Primary or second home | Primary, second home, investment |
| Refinance leverage | Up to 75% (cash-out set by lender) | See leverage list below |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
For the depletion path, the leverage figures through select programs are:
- Primary residence or second home: up to 80% on a purchase or rate-and-term refinance, and up to 60% on a cash-out refinance.
- Investment property: up to 65% on a purchase or rate-and-term refinance, and up to 60% on a cash-out refinance.
Those are ceilings, not offers. Credit, the appraisal, and the full file still decide where you land.
The gap between 80% and 60% on a primary residence is the part most borrowers miss. Cash-out costs you 20 points of leverage on the same home. That is also why the Indiana equity you imagined may be smaller than the number you had in mind.
What Counts as an Asset (and What Doesn’t)?
Each path gives your accounts a different credit percentage. Never blend the two tables.
| Asset | Qualifier Path | Depletion Path |
|---|---|---|
| Brokerage / securities | 100% | 80% |
| Cash, savings, money market | 100% | 100% (cash accounts) |
| Certificates of deposit | 100% | 100% |
| Retirement accounts | 90% under 59½, 100% after | 70% at any age |
| Private stock | Not listed | 75% |
| Real-estate equity | Not listed | 60% |
Some assets are not eligible on the depletion path at all. They include custodial accounts, deferred compensation, escrow accounts, foreign funds, cash on hand, stock options, non-vested restricted stock units, and funds from non-regulated financial companies.
Cryptocurrency, precious metals, collectibles, and borrowed or pledged funds are not published as eligible on either path. The documented route is converting them to a seasoned cash balance in a regulated account, with the source reviewed by the lender. Skip any plan that counts them at a percentage.
Your home’s own equity is not the pool. The home securing the loan cannot be the asset that qualifies you, a principle Consumer Financial Services Review describes in its commentary on the federal ability-to-repay rule. The same commentary notes that a down payment cannot be treated as an asset for that purpose.
Why Doesn’t the Cash-Out Help You Qualify?
Because the program never counts it. Cash-out proceeds are not qualifying assets on the depletion path. You cannot pull $200,000 out of the house and then count it as part of the pool that approved you.
Plan your file around that. Qualify on the accounts you already hold. Treat the new cash as money you will use, not money that backs the loan.
Double counting is the other trap. Cash used to qualify is spoken for. Assets used for a purchase or other needs cannot also stay in the pool at full value. Subtract what you plan to spend before you divide by 60.
Picture a retiree who sold a business, holds the proceeds in a brokerage account, and wants cash out of an Indiana home to cover a family need. The brokerage balance builds the qualifying income. The cash-out pays for the need. Those are two separate jobs.
Owner-Occupied Home or Indiana Rental?
Occupancy decides which route fits. Be honest with yourself about it before you apply.
For a primary residence or second home, asset depletion is a natural match. The program was built around those occupancies. Cash-out is available on the depletion path at 60%, subject to underwriting and the lender’s matrix.
An Indiana rental is different. Investment property is allowed on the depletion path, but leverage is tighter: 65% on a purchase or rate-and-term refinance, and 60% on a cash-out. Credit matters more too. A first-time investor on the depletion path needs a 700 score.
The federal rule on consumer credit points the same direction. Under the CFPB’s Regulation Z commentary, credit to acquire, improve, or maintain non-owner-occupied rental property is generally treated as business purpose. That treatment changes if the owner expects to occupy the property for more than 14 days in the coming year. So intended occupancy decides which rulebook applies, and a lender will ask.
For a pure rental, many investors are better served by a loan that reads the lease instead of your balance sheet. 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. Lendmire’s complete DSCR loans guide walks through how that route works. It leaves your liquid assets alone and asks whether the property carries itself.
Run both. Asset depletion reads a balance sheet. DSCR reads a lease. They share a “no personal income documentation” reputation, but they are different underwriting paths.
How Do Agency Rules Compare?
They are a different animal, and they are why so many online answers contradict each other. Fannie Mae’s cash-out guidance generally requires at least one borrower to have been on title for six months before disbursement, with exceptions for inheritance and court awards.
Those are conventional agency rules. They do not describe this program. If you read a page that says no cash-out with asset income and another that says yes, they are often describing different programs. One may be agency. The other may be a non-agency program through a wholesale network.
What Seasoning, Credit and Statements Do You Need?
Expect your accounts to be reviewed closely.
Qualifier path. Accounts need 60 days of seasoning, and two months of statements for each qualifying account. The minimum credit score is 600. No reserves are required at or below 75% loan-to-value. Above that, the lender sets them.
Depletion path. Statements must be 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. Credit follows the lender’s score and loan-amount matrix.
Depletion has a few more hurdles. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. They can never fall below $250,000 liquid when asset depletion is your only income source. Housing history is reviewed at 0x30x12, and one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible. A prior housing event needs 4 years of seasoning on this path.
Asset income can also supplement documented income, up to a 45% debt-to-income ratio. When it does, the minimum-assets rule is waived.
Meeting every line does not guarantee approval. Every file is underwritten individually.
When Should You Skip Asset Depletion?
Skip it when the numbers or the goal point elsewhere. Four common cases:
- You need more than 60% of the home’s value. The depletion path caps cash-out there. Another structure might reach further.
- Your assets are mostly crypto, collectibles, or borrowed funds. They need to be converted first.
- You bought the home with cash recently. Delayed financing may be the better lane.
- The property is a rental and the lease is strong. A loan underwritten to the property’s income can protect your portfolio.
Cash-out also raises your balance. That raises the housing payment, which then has to fit inside the debt-to-income test. New money should earn more, or solve a bigger problem, than it costs.
Key Terms Defined
Cash-out refinance: A new mortgage larger than your old payoff, with the difference paid to you.
Rate-and-term refinance: A new mortgage that replaces the old one without paying you extra cash.
Haircut: The percentage of an account’s balance a lender refuses to count.
Imputed income: Monthly income a lender calculates from your assets, not income you actually receive.
Seasoning: How long funds have sat in your account before a lender will use them.
Debt-to-income (DTI): Your monthly debts, including the new housing payment, compared with your qualifying monthly income.
Loan-to-value (LTV): The loan balance as a percentage of the home’s appraised value.
Frequently Asked Questions
Do I have to sell investments to qualify?
No. Qualifying is a calculation, not a withdrawal plan. Your accounts stay invested. The lender counts a share of the balance, either toward covering the loan or toward calculated monthly income.
Can my Indiana home equity count as the assets?
No. The home securing the loan is not part of the pool. On the depletion path, equity in other real estate counts at 60%, subject to underwriting. Your accounts are what drive the file.
Does Indiana change the program figures?
No. Leverage, asset percentages, and seasoning are the same for an Indiana borrower as for borrowers in other states Lendmire serves. Taxes, insurance, and local prices vary by county, so they affect your payment and appraisal, not the program rules.
Can cash-out proceeds count as reserves or qualifying assets?
No. On the depletion path, cash-out proceeds never count as qualifying assets. Build your file on the balances you hold before the new loan.
Is asset depletion the same as a DSCR loan?
No. Asset depletion reads your balance sheet and is a consumer mortgage. A DSCR loan reads the property’s rent against its payment and is a business-purpose investor loan. Rentals often fit the second better.
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. Lendmire is a broker that arranges these loans through select lenders in its network, and nothing here is a commitment to lend.
For the mechanics of pulling equity out of a rental property, see Lendmire’s guide to cash-out refinance on an investment property.
Lendmire’s asset-based mortgage in Indiana page presents the program for Indiana borrowers.
About Lendmire
Lendmire, NMLS# 2371349, is a mortgage brokerage with consumer lending licenses in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages are arranged through wholesale lending partners for borrowers whose tax returns understate their income, and each application is reviewed individually by the lender. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
2. CFPB Regulation Z, Section 1026.3 (exemptions and business-purpose credit)
3. Fannie Mae Selling Guide B2-1.3-03, Cash-Out Refinance Transactions
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Does an Asset Depletion Loan Require Any Income? · Asset Qualifier vs Asset Depletion for a Cash-Out Refinance · How Jumbo Loan Asset Depletion Rules Work for a Second Home
Guides: Asset-Based Mortgage in Indiana
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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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.