The Quick Read: Choose the asset qualifier path when your eligible assets, after the program’s credit percentages, equal or exceed the entire loan amount, because then no income is documented and no debt-to-income test applies. You stay on asset depletion when your assets fall short of the full loan, when you need the assets to become income, or when the property is an investment property.
- Asset qualifier path: your usable assets must cover the whole loan, and no employment or income is documented.
- Asset depletion path: usable assets are divided by 60 months into monthly income that must carry the housing payment and your other debts.
- Qualifier leverage: up to 80% on a purchase and 75% on a refinance, for a principal residence or second home, through select programs and subject to underwriting.
- Depletion leverage: up to 80% on a purchase for a principal residence or second home, and 65% on a purchase of an investment property, subject to underwriting.
- You are on one path at a time. The two sets of figures never blend on one file.
What Do These Two Paths Actually Mean?
The asset qualifier path asks one question: do your eligible assets cover the entire loan? The asset depletion path asks a different one: if your assets were paid out over 60 months, would that income carry the loan?
Some lenders use these labels loosely, and a few treat them as synonyms. Across the wholesale network Lendmire works with, they are separate tracks with separate rules. Ask any lender, in writing, which calculation it means before you compare offers.
Here is the plain version of each:
- Qualifier path. You add up eligible assets after the credit percentages. If the total equals or exceeds the loan, you qualify on assets alone.
- Depletion path. You add up eligible assets after the haircuts. You divide by 60 months. The result is a monthly qualifying income that runs through the debt-to-income test.
Neither path asks you to sell anything. The assets stay where they are, and the lender counts them on paper. Both paths document the assets. Skipping income documents never means skipping documents.
The loan is a consumer mortgage, so it fits a home you will live in or use as a second home. Lendmire is a broker. It arranges the loan through select lenders, and those lenders underwrite and approve it.
How Do the Two Paths Compare Side by Side?
The qualifier path is simpler and more generous with your assets, but it demands that they cover the whole loan. The depletion path is more flexible about property type and asset type, but it adds a debt-to-income test and a minimum asset rule.
| Factor | Asset qualifier | Asset depletion |
|---|---|---|
| Core test | Usable assets ≥ full loan | Assets ÷ 60 = income, then DTI |
| Income documented | None | Derived from assets |
| Purchase leverage | Up to 80% | 80% primary or second; 65% investment |
| Refinance leverage | Up to 75% | 80% rate-and-term; 60% cash-out |
| Loan amounts | Up to $4,000,000 | $125,000 to $3,500,000 |
| Credit | 600 minimum | Lender’s matrix |
| Seasoning | 60 days, two months of statements | Statements 120 days old, plus one within 45 days |
| Investment property | No | Yes, on this path only |
The depletion refinance figures apply to a principal residence or second home. On the depletion path, an investment property tops out at 65% on a purchase or rate-and-term refinance and 60% on a cash-out. Cash-out proceeds never count as qualifying assets. Whether the qualifier path allows cash-out, and at what leverage, is set by the lender and is not published.
All figures are ceilings and floors through select programs, subject to underwriting. They are not offers.
When Does the Qualifier Path Win?
Several situations point toward the qualifier path, since it removes the debt-to-income math and the income paperwork.
1. Your usable assets cover the full loan. Count the balances after the credit percentages. If the total clears the loan amount, this is the cleanest route.
2. Your debts would strain a debt-to-income test. The qualifier path documents no income, so a heavy existing debt load is not tested the way it is on depletion.
3. Your balances sit in the assets that count fully here. Brokerage accounts, certificates of deposit, money market and savings all count at 100% on this path. Securities count at only 80% on the depletion path, so the same brokerage account goes further on the qualifier path.
4. Your retirement money is a big part of the picture. A 401(k) or IRA counts at 90% under age 59½ and 100% at 59½ or older on the qualifier path. On the depletion path, retirement accounts count at 70% at any age.
5. The loan is large. The qualifier path runs up to $4,000,000, against $3,500,000 on depletion.
Reserves are another advantage. On the qualifier path none are required at or below 75% loan-to-value. Above that, the lender sets them. The credit floor is 600 on this path, though the strongest files pair assets with solid credit and a clean housing history, subject to underwriting.
A qualifier example
Say you are buying a home with an $800,000 loan. You hold $330,000 in brokerage accounts, $300,000 in a 401(k) and $200,000 in savings. You are under 59½.
- Brokerage counts at 100%, or $330,000.
- The 401(k) counts at 90%, or $270,000.
- Savings counts at 100%, or $200,000.
That totals $800,000 of usable assets, which equals the loan, so the file is reviewed on assets alone. Underwriting still reviews statements, credit and the property, and the lender’s own calculation governs.
When Does Asset Depletion Win?
Depletion wins when your assets do not cover the whole loan, when you want the assets to supplement other income, or when the property is an investment property. It converts a deep portfolio into income, and that income then has to clear a debt-to-income test.
Reach for depletion in these cases:
1. Your usable assets fall short of the loan. The qualifier path cannot work if the total is less than the loan. Depletion only needs the income to carry the payment.
2. You hold assets the qualifier path does not list. Private stock counts at 75% and real-estate equity at 60% on the depletion path. The qualifier path lists neither.
3. You have documented income too. Asset-derived income can supplement it, up to a 45% debt-to-income ratio. When it supplements, the minimum-assets rule is waived.
4. The property is an investment property. Depletion is the only asset-based path that allows it, at lower leverage.
5. Your seasoning story is unusual. Funds from the sale of a business, an inheritance or a legal settlement are excused from the 120-day statement-age rule on depletion.
Depletion has its own entry bar. Qualified assets must be at least the lesser of $1,000,000 or 1.25 times the loan balance. When depletion is your only income source, you also need at least $250,000 liquid. Credit follows the lender’s score and loan-amount matrix. A first-time investor needs a 700 score.
A depletion example
Picture a retiree with $1,500,000 in securities and $300,000 in cash.
- Securities count at 80%, or $1,200,000.
- Cash counts at 100%, or $300,000.
That is $1,500,000 of usable assets. Divide by 60 months and you get $25,000 of monthly qualifying income. That income then carries the housing payment and other debts through the debt-to-income test. The lender’s own calculation governs the result.
Which Constraint Is Actually Holding Your File Back?
Diagnose the binding constraint first, and the path usually picks itself. Files stall on one of three things: asset coverage, income math, or property type. Test them in that order.
Test 1: coverage. Add your eligible balances using the qualifier percentages. Compare the total to the loan. If it clears, the qualifier path is your lead candidate.
Test 2: income. If coverage fails, add your balances using the depletion haircuts. Divide by 60. Ask whether that income, minus your other debts, carries the new payment. If it does, depletion works.
Test 3: property. If the home is a second home or primary residence, both tests stay open. If it is a rental you plan to hold, only depletion remains, at 65% on a purchase.
The flip point is usually the loan size relative to your usable assets. A buyer with assets just above the loan amount is a natural qualifier-path file. The same buyer with a slightly larger loan may flip to depletion, because depletion only needs the monthly income to work.
How Does This Play Out for Colorado Buyers?
The program figures do not change by state, so Colorado buyers face the same rules as anyone else. Colorado is one of the 16 states where Lendmire’s consumer mortgage lending is licensed. The right path depends on your balance sheet and your intended use for the home.
| Colorado scenario | Likely path | Why |
|---|---|---|
| Retiree selling a home elsewhere and buying in the Front Range | Qualifier | Sale proceeds and savings may cover the loan outright |
| Mountain second home, large brokerage account | Qualifier | Brokerage counts at 100% and no income is documented |
| Founder who sold a business, cash parked in a regulated account | Depletion | Sale funds are excused from the 120-day statement rule |
| Executive with salary plus a large portfolio | Depletion | Asset income can supplement documented income to a 45% DTI |
| Relocating buyer who wants to rent the home out | Depletion or DSCR | Qualifier path excludes investment property |
Colorado condo and HOA reviews, appraisals and insurance still apply to the property itself. They sit on top of whichever path you choose.
Which Assets Count, and Which Do Not?
Cash-like accounts count fully on both paths. After that, the paths diverge, so name the path whenever you quote a percentage.
| Asset | Qualifier path | Depletion path |
|---|---|---|
| Brokerage accounts | 100% | Securities at 80% |
| CDs, money market, savings | 100% | Cash and CDs at 100% |
| 401(k) and IRA | 90% under 59½; 100% at 59½ or older | 70% at any age |
| Private stock | Not listed | 75% |
| Real-estate equity | Not listed | 60% |
Not eligible on the depletion path: 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, borrowed or pledged funds, and business accounts beyond your ownership share 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 lender reviewing the source. Plan that early, because seasoning takes time to build.
The federal rule behind consumer mortgages lets a lender rely on income, assets or both, and only on what it verifies. The Consumer Financial Protection Bureau’s ability-to-repay rule says so directly. Its official interpretation lists savings, vested retirement amounts, stocks, bonds and CDs as eligible assets. That is why both paths document the assets they count. The specific percentages and divisors are program overlays, not federal numbers.
Retirement balances raise one more question. Tax treatment varies; consult a qualified professional before relying on any withdrawal or deduction.
What Are the Costs of Each Path?
Neither path is free. Both tie up money you may want for other things, and both depend on market values on the day your statements are reviewed.
Liquidity. Assets counted toward qualifying generally cannot also fund your down payment and closing costs. Subtract those first, then count what is left. A large down payment shrinks the pool and, on depletion, the income it produces.
Volatility. A falling market can shrink brokerage and retirement balances between statements. Securities already carry a haircut on depletion, but a sharp drop can still pull a file below the minimum. A borrower near the line should build a cushion.
Seasoning. The qualifier path wants 60 days of seasoning and two months of statements per account. The depletion path wants statements at least 120 days old at application, plus the most recent one within 45 days. Fresh deposits that sit under those windows can leave a file short.
Pricing and terms. Pricing varies by lender, credit profile and leverage. Ask for terms on both paths if you qualify on both, and compare the full offers.
What If Neither Path Fits?
Several other programs may fit better, depending on how you earn and what you are buying. Here is when each tends to make sense.
- Bank statement program. It suits borrowers who document income through deposits, such as self-employed owners.
- Standard income loan. If your documented income already carries the payment, you may not need an asset path at all.
- DSCR loan. For a pure rental, DSCR is usually the better lane. 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.
A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Programs below 1.00 coverage are available through select lenders, but leverage and terms adjust. The complete DSCR loans guide covers the investor side in full.
Asset-derived income can also be blended with documented income on the depletion path. If a file works on both paths, run both and compare.
Pre-Application Checklist
Gather these before you talk to a lender. They let you self-triage in an afternoon.
1. The loan amount you expect, after your intended down payment. 2. Balances in each account, split by type: cash, CDs, brokerage, retirement, private stock. 3. Your age, since 59½ changes the retirement percentage on the qualifier path. 4. The most recent two months of statements for each account. 5. Statements that are at least 120 days old, if you may use the depletion path. 6. The source of any recent large deposit. 7. Your current monthly debts, for the depletion income test. 8. Whether the home will be a primary residence, a second home or a rental.
Key Terms Defined
Asset qualifier path: a way to qualify where eligible assets, after credit percentages, must equal or exceed the whole loan, with no income documented.
Asset depletion path: a way to qualify where usable assets divided by 60 months become monthly income for the debt-to-income test.
Debt-to-income (DTI): the share of your monthly income that goes to debt payments, including the new housing payment.
Seasoning: the time funds must sit in an account before a lender counts them.
Haircut: the share of an asset’s balance a lender discounts when counting it, such as counting securities at 80%.
Loan-to-value (LTV): the loan amount divided by the property’s value.
Frequently Asked Questions
Are the asset qualifier and asset depletion paths the same thing?
No. In this program the qualifier path tests whether usable assets cover the entire loan, while the depletion path turns assets into monthly income over 60 months. Some lenders use the terms loosely, so confirm which calculation a program means.
Do I have to sell or liquidate my assets?
No. On both paths the lender counts your balances on paper, and the accounts stay where they are. The assets must be documented, seasoned and verified, and a lender may ask about the source of recent large deposits.
Can I use my 401(k) or IRA?
Yes, on both paths, at different percentages. The qualifier path counts retirement balances at 90% under age 59½ and 100% at 59½ or older. The depletion path counts them at 70% at any age. Both are subject to underwriting.
Can I buy a rental with either path?
Only the depletion path allows an investment property, at up to 65% on a purchase or rate-and-term refinance. The qualifier path is for principal residences and second homes. For most rentals, a DSCR loan is the more efficient structure.
What if I qualify on both paths?
Compare them. The qualifier path avoids the debt-to-income test and the 60-month income conversion. The depletion path allows more asset types and, in some cases, a different loan size. A file is qualified on one path at a time.
Ready to Compare?
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 each file is underwritten individually, so nothing here is a commitment to lend.
Colorado’s mix of Front Range primary homes and mountain second homes tends to favor buyers who count their balances honestly before they pick a path.
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
1. Consumer Financial Protection Bureau, 12 CFR 1026.43
2. Bankers Online, 1026.43 official interpretation
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 Depletion vs Bank Statements vs DSCR for a Post-Exit Buyer · How Big Can an Asset Qualifier Mortgage Be?
Guides: Asset-Based Mortgage in Colorado
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
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- 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.