The Quick Read: Yes, when the borrower’s eligible balances are large enough, select asset-based programs will either count those balances against the entire loan or convert them into monthly qualifying income, and the file documents the assets with statements instead of traditional personal-income documentation, pay stubs or employment verification, subject to underwriting. Every file is fully underwritten. The assets are the evidence.
- Two paths exist. On one, assets cover the whole loan. On the other, assets become income. A borrower is reviewed on one path at a time.
- Leverage differs by path. The asset qualifier path allows up to 80% on a purchase and 75% on a refinance of a principal residence or second home.
- Retirement accounts can count. On the qualifier path, a 401(k) or IRA counts at 90% under age 59½ and 100% at 59½ or older. On the depletion path it counts at 70% at any age.
- You keep your portfolio. The lender uses balances to qualify you. It does not require you to sell or withdraw anything.
- Programs change. Figures here are ceilings and floors from select programs, not offers.
Which Path Fits a Retiree With Big Savings and Little Paycheck?
The asset qualifier path fits you if your eligible assets equal or exceed the entire loan. The asset depletion path fits you if your assets are large but not that large. It turns them into a monthly income that has to carry the housing payment and your other debts.
Here is the practical split. On the asset qualifier path, the lender adds up usable assets after the credit percentages below. If that total meets or beats the loan amount, the file is reviewed on assets alone. No employment or income is documented. Loans run up to $4,000,000.
On the asset depletion path, the lender takes usable assets and divides them by 60 months. The result is your qualifying income. That income goes through a debt-to-income test, which compares your monthly debts to your income. Loan amounts run from $125,000 to $3,500,000.
Most retirees with seven-figure portfolios and modest taxable income land on the depletion path. Retirees who sold a business or received an inheritance, and who hold cash worth more than the loan, often fit the qualifier path. Lendmire arranges both through its asset-based mortgage program, placed with select lenders in its wholesale network.
How Does Assets-Only Qualifying Work?
On the asset qualifier path, usable assets must cover the whole loan. Each account counts at a set percentage, and the totals are added together. No income is calculated.
Run a worked example. Say the loan is $800,000. The borrower holds three kinds of accounts:
- $330,000 in brokerage accounts, which count at 100%, or $330,000.
- $300,000 in a 401(k), borrower under 59½, which counts at 90%, or $270,000.
- $200,000 in savings, which counts at 100%, or $200,000.
Usable assets total $800,000. That equals the loan, so the file is reviewed on assets alone. The lender’s own calculation governs, and this is illustration only.
Two more details matter. Credit needs a 600 minimum score on this path. Reserves are not required at or below 75% loan-to-value. Above that, the lender sets them.
How Does the Depletion Path Turn Savings Into Income?
The depletion path discounts each asset type, adds the results, and divides by 60 months. The answer is a monthly qualifying income. It is a qualifying convention, not a withdrawal plan, and you keep the assets.
Take a second example. A retiree holds $1,500,000 in securities, which count at 80%, or $1,200,000. The retiree also holds $300,000 in cash, which counts at 100%. Usable assets total $1,500,000. Divided by 60 months, that is $25,000 of monthly qualifying income. That income then has to carry the housing payment and other debts through the debt-to-income test.
The program also sets minimums. Qualified assets 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 in liquid assets. If you have documented income such as a pension or Social Security, asset-derived income can supplement it up to a 45% debt-to-income ratio. In that case the minimum-assets rule is waived.
Credit on this path follows the lender’s score and loan-amount matrix. Housing history is 0x30x12, though one 30-day late in the last twelve months is considered case by case. Multiple bankruptcies are not eligible.
What Counts, and How Much?
Each path discounts assets differently, so keep the tables separate. These are the shares of each balance that count, subject to underwriting.
Asset qualifier path:
| Asset | Share that counts |
|---|---|
| Brokerage accounts | 100% |
| CDs, money market, savings | 100% |
| 401(k)/IRA, under age 59½ | 90% |
| 401(k)/IRA, age 59½ or older | 100% |
Asset depletion path:
| Asset | Share that counts |
|---|---|
| Cash accounts and CDs | 100% |
| Securities | 80% |
| Private stock | 75% |
| Retirement accounts (any age) | 70% |
| Real-estate equity | 60% |
Some assets do not count 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 pledged or borrowed funds are not published as eligible on either path. The documented route is converting them to a seasoned cash balance in a regulated account. The lender then reviews the source of those funds.
One more rule from the depletion path: cash-out proceeds never count as qualifying assets. Home equity in the property you are borrowing against does not count either, a point covered below.
Do Retirement Accounts Count If You’re Under 59½?
Yes, on both paths. The difference is the percentage. On the qualifier path, a 401(k) or IRA counts at 90% before 59½ and 100% after. On the depletion path, it counts at 70% at any age.
Many retirees assume retirement money has to be cashed out first. It does not. The lender counts the balance as an asset, and the account stays where it is. That is why the approach suits people who would otherwise pay penalties or sell into a bad market just to qualify.
Pensions and Social Security work differently. Lenders treat them as lasting income, while portfolio balances are treated as depletable. That is the reason the depletion path exists: it gives balances a monthly value that can sit beside documented income.
What Does the Lender Check Before Approving?
The lender verifies that your assets are real, owned and seasoned. Seasoning means the money has sat in your accounts long enough that it is clearly yours.
On the qualifier path, expect 60 days of seasoning and two months of statements for every qualifying account. On the 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 on the depletion path.
Large unexplained deposits draw questions. If you are about to move money between accounts, tell your broker first. Moving assets mid-file can reset the clock on a balance that was already seasoned.
Plan to provide statements, credit, a property appraisal, and the usual title and insurance items. Notice what is missing: traditional personal-income documentation, pay stubs and employment verification. The assets are documented. Only the income documentation is different.
What About Buying a Rental?
A rental purchase changes the rules. A loan on a rental is a business-purpose investor loan, and it is reviewed differently from a standard owner-occupied mortgage. Assets can still qualify you through the depletion path, with lower leverage.
On the asset depletion path, an investment property goes up to 65% loan-to-value on a purchase or rate-and-term refinance. A cash-out refinance goes up to 60%. A first-time investor on this path needs a 700 credit score. Final terms depend on the lender’s guidelines, the property type, and the borrower’s complete credit picture.
The alternative is a DSCR loan, which qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. DSCR means debt service coverage ratio: monthly rent divided by the monthly housing obligation. If a rental’s rent comfortably covers its payment, your portfolio does not have to carry it. Credit, reserves and the property still get reviewed. Select lenders in the network offer programs below 1.00 coverage, though leverage and terms adjust.
For most retirees, the choice is simple. If the rent covers the payment, DSCR usually fits. If it does not, or you want the portfolio to carry the loan, depletion fits. Asset-based qualifying for a residence you will live in is a separate conversation, covered above.
Why Is This Legal?
The federal ability-to-repay rule lets a lender weigh assets, not just paychecks. Under Regulation Z § 1026.43, a lender must make a reasonable, good-faith determination that you can repay. It may consider current or reasonably expected income or assets other than the value of the dwelling that secures the loan, per Cornell’s Legal Information Institute.
The lender must also verify what it relies on. The rule calls for third-party records that provide reasonably reliable evidence of income or assets. That is why a statement is required, and why the homes themselves cannot count: the dwelling securing the loan is excluded.
Loans on rentals follow a different track. Regulation Z exempts credit extended primarily for a business or commercial purpose, as the eCFR text of § 1026.3 shows. A loan on an investment property falls on that side of the line.
What Changes for a Colorado Borrower?
Not the program figures. They are the same in every state where the program is available. Colorado is one of the 16 states where Lendmire’s consumer mortgage lending is licensed. The state’s factors are context only.
Colorado housing runs from Front Range suburbs to mountain-resort condos, and the loan size you need shapes the path. A bigger loan raises the usable assets needed, whether you qualify on assets alone or on depletion income. Condos and second homes get a property review of their own, separate from your assets.
Many Colorado buyers are retirees relocating with wealth built elsewhere. Brokerage and retirement balances held out of state count the same way, as long as they are documented and seasoned.
Should You Sell Investments or Borrow Against Them?
It depends on your cost of selling, your cash needs and your tolerance for a loan payment. Paying cash means selling assets, which can trigger tax bills and removes those dollars from your portfolio. Qualifying on assets keeps the portfolio invested but adds a loan payment.
Tax treatment varies; consult a qualified professional before deciding.
A retiree with a strong stock allocation and a large embedded gain often prefers to keep it working. A retiree who wants no payment at all may prefer cash. A third option is to qualify on assets while drawing from accounts slowly, which preserves flexibility.
Planners often suggest applying for a home loan while income is still documented, if that is possible. The assets-based path exists for everyone else.
What Are the Risks?
The risks are real, and they are not about approval.
- Market drops. If your portfolio falls sharply during a long file, your usable assets shrink, and that changes the lender’s review math. The lender recalculates from the statements.
- Payment pressure. Qualifying on assets does not mean the payment is cheap. A loan payment still comes out of your cash flow every month.
- Portfolio drawdown. If you draw from the same accounts that qualified you, balances fall. Plan the withdrawals before you borrow.
- Non-agency terms. Pricing and leverage on these programs are set by each lender, not by the agencies. Compare terms across select lenders.
Agency-backed conventional loans, such as Fannie Mae’s, treat asset income far more narrowly. That is those programs’ rule, not this one.
Key Terms Defined
Asset qualifier path: qualifying when usable assets equal or exceed the entire loan amount.
Asset depletion path: qualifying by dividing usable assets by 60 months to create monthly income.
Seasoning: the time money must sit in your accounts before it counts.
Haircut: the discount a lender applies to an asset, such as counting securities at 80%.
Debt-to-income (DTI): your monthly debts divided by your monthly income.
Frequently Asked Questions
Do I have to sell my investments or withdraw from my IRA?
No. The lender counts your balances as assets, and they stay where they are. The qualifying math is a convention, not a withdrawal schedule. You choose whether to draw on the accounts later.
Does my 401(k) count if I’m under 59½?
Yes, subject to underwriting. On the asset qualifier path it counts at 90% before 59½ and 100% after. On the asset depletion path it counts at 70% at any age.
Can I combine Social Security or a pension with my assets?
On the depletion path, asset-derived income can supplement documented income up to a 45% debt-to-income ratio. When it supplements, the minimum-assets rule is waived. Qualifier-path files do not document income at all.
Can I use this for a rental property?
Yes, through the depletion path at 65% on a purchase or rate-and-term refinance and 60% on a cash-out refinance of an investment property. A DSCR loan is the other option when rent covers the payment.
Does the home I am buying count as an asset?
No. The equity in the dwelling securing the loan is excluded. On the depletion path, equity in other real estate counts at 60%.
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. Colorado retirees with large balances and modest paychecks often find the route is simpler than they feared.
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. CFPB Regulation Z § 1026.43
2. Cornell Legal Information Institute, 12 CFR 1026.43
This article is part of Lendmire’s asset-based mortgage program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can a Virginia Retiree Get a Mortgage on Savings and Investments Alone? · Pledged Asset Line vs Asset Qualifier Mortgage for a Colorado Home Purchase · How Snowbirds Get a Mortgage on a Winter Home Without Income
Guides: Asset-Based Mortgage in Colorado
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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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.